The company says this was mainly driven by higher like-for-like cement volumes in all group regions and the continued strong momentum of the Holcim Leadership Journey coupled with strict cost management across the group
“Margins continued to increase and cash flow from operating activities was also better than in the first quarter of 2013,” says said Bernard Fontana, CEO of Holcim.
Operating profit for the quarter was €242 million, an increase of 9.3% on the same quarter in 2013 . On a like-for-like basis the growth in operating profit reached 28.4%, and net income, which in the first quarter of 2013 benefited from the sale of a 25% stake in Cement Australia, decreased by 39.5% year-on-year to €147 million. Adjusted for this transaction in 2013 net income was up by 19.6%.
Cash flow from operating activities, which is traditionally negative in the first quarter, improved by 24.9% and reached negative €199 million and during the last year Holcim has reduced its net financial debt by €589 million from €8.86 billion to €8.2 billion.
Consolidated cement sales increased by 2.9% to 33 million tonnes in the first quarter of 2014, due mainly to Europe, where France, Germany and Russia reported the strongest increases. Net sales reached €3.35 billion, a fall of 5.4% that was mainly influenced by negative currency effects.
On a like-for-like basis net sales were up by 7.8%. Consolidated operating earnings before interest, taxes, depreciation, and amortisation (EBITDA) decreased by 5.1% to €507 million but grew by 10.1% when adjusted for foreign exchange effects and changes in consolidation.
As part of the Holcim Leadership Journey, the company continued to optimise its portfolio and has sold its activities in French Guyana and acquired a port facility in the Philippines. It has also progressed plans to further optimise its strategic portfolio in Europe, having secured approval for the transaction with Cemex in the Czech Republic and is awaiting the decision on the other parts of the transaction.
For 2014 Holcim expects global economies to show another year of uneven performance. With construction markets in Europe expected to have reached the bottom with slow recovery in sight.
North American markets are expected to continue to benefit from a further recovery, especially in the United States while Latin America could continue to face uncertainties in Mexico but should overall show slight growth in 2014.
The Asia Pacific region is expected to grow, although at a comparatively slower pace than experienced in recent years.
Africa and the Middle East are expected to gradually improve. Holcim expects cement sales volumes to increase in all regions in 2014.
