Displaying items by tag: Switzerland
Holcim blames 32% income drop in third quarter on strong franc
09 November 2011Switzerland: Holcim has blamed a 32% fall in income for the third quarter on the strong Swiss franc.
Holcim's income fell by 32% to USD460m in the third quarter from USD680m in the second quarter of 2011. Over the nine months to 30 September 2011 its income fell by 18% year-on-year to USD1.1bn from USD1.4bn in 2010. Sales mirrored this decline, falling year-on-year by 6.1% to USD5.9bn over the nine months to 30 September 2011 compared to USD6.3bn in 2010. The decline in sales between the second and third quarters was similar at 6.7%.
Despite the fall in total group income and sales, sales of cement rose in both the nine-month and quarterly period. For the nine months to 30 September 2011 sales rose by 5.2% to 108Mt from 103Mt. For the quarter ending 30 September 2011 volume sales rose by 6.2% to 37.2Mt from 35Mt in the quarter ending 31 July 2011.
"The strong appreciation of the Swiss franc during the first half of 2011 continued to negatively impact the financial result during the quarter, albeit to a lesser extent than during the second quarter," said Chief Financial Officer Thomas Aebischer. Holcim's sales during the three months to 30 September 2011 were reduced by USD948m by the currency. Operating earnings before interest, taxes, depreciation and amortisation (EBITDA) were reduced by USD200m, according to Aebischer.
As expected, Holcim noted that many emerging markets enjoyed brisk construction activity. In the Eurozone and in North America growth mainly remained restrained. The Latin America cement sector achieved the strongest rise in sales volumes, followed by Asia Pacific and Europe. In particular, the group's companies in Russia, Singapore, Indonesia, Colombia and Australia made larger contributions in Swiss francs to the sales. Where other group companies improved their results in local currency terms these successes were cancelled out overall by the strong Swiss franc.
In its outlook Holcim has pinned its hopes for consistent growth in the emerging markets of Latin America and Asia whilst singling out Africa and the Middle East for continued poor trading. In Europe and North America Holcim's intends for its lean cost structure to enable it to benefit more than average from any economic recovery. Lastly, the group mentioned that the sharp global rise in energy, raw material and transportation costs call for further price adjustments.
Holcim back into profit in Q1
07 June 2011Switzerland: Holcim has reported a return to profitability in its first quarter 2011 financial results, with net income of Euro8.07m on a 1.8% decline in sales. For comparison Holcim made a loss of Euro54.9m in the same period of 2010. The group's revenue for the first quarter of 2011 was Euro3.67bn compared to Euro3.83bn in the first quarter of 2010. The group's earnings before interest, tax, depreciation and amortisation (EBITDA) was down by 17.1% compared to the first quarter of 2010 at Euro608.2m. The company attributed the decline to negative currency impacts of Euro59m. When looking at like-for-like EBITDA, however, the decline was only 1.8%. The company added that like previous first quarters, the cash flow from operating activities was minus Euro434m due to seasonal factors.
Holcim said that it expects the construction market to continue to recover in 2011. Reporting its expectations for the rest of 2011 Holcim said, "We are still of the opinion that the construction sector in the mature markets will recover and that the growth in emerging markets will continue." Holcim added that it was confident of, "securing its share of future growth in the emerging market and that its lean cost structures will enable it to benefit above average from continuing economic recovery in Europe and North America."