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Although the Lafarge-Holcim cement group grew strongly in the first half, it achieved two-thirds less profit than the previous year. An important reason for this is restructuring costs. Operationally, the region slows down the Middle East and Africa
By reading the half-yearly results of Lafarge-Holcim cement group , the reader quickly discovers that the profit target for 2018 and the situation at the end of June are still very different.
On the basis of unrevised figures according to international IFRS standards, the profit for the first half of 2018 rose from CHF 1.2 billion to CHF 400 million. There are many reasons for this and not all are worrying. In the previous year, for example, sales of Lafarge-Holcim Vietnam amounted to CHF 339 million. A post that is so unique. In addition, there are restructuring costs of CHF 300 million, up significantly from the previous year (CHF 38 million). This is the price of the various measures initiated by the new managing director, Jan Jenisch, in order to make Lafarge-Holcim more efficient and therefore more profitable and growing. It has, among other things, removed a management level, closed offices in Miami and Singapore and reduced branches in Paris and Zurich. This should save 400 million francs a year from the second quarter of 2019. As a result, these costs are easily accepted, but they must be promptly repaid.
However, even excluding all these effects, adjusted operating income before interest, taxes, depreciation and amortization (EBITDA) also shows a decrease of CHF 100 million or -1.4% on a like-for-like basis. . Nevertheless, Lafarge-Holcim has confirmed the targets for 2018. And these provide for a growth of at least 5% of EBITDA adjusted on a comparable basis. Jan Jenisch and his team, in other words, announce a par-force performance for the second half. Because until December, the company must not only offset the shortfall, but also grow significantly in order to achieve the goal. In any case, there is already a clear improvement compared to the first quarter (-7.7%), even if development remains below the levels of the previous year.
Management's trust is based on the following elements Hopefully the statements in the Letter to Shareholders: Strong demand in Europe, solid growth in North America, good prospects in most American countries Latin, support of India and China and more stable conditions in Southeast Asia
but the region remains the Middle East and Africa. This is responsible for the fact that operating profit adjusted in the first half decreased. All other regions experienced comparable growth between January and June, increasing their profits. Not only in the Middle East and Africa. There, sales decreased by 7% and adjusted operating income decreased by a third. As a result, it is hardly surprising that Jan Jenisch has recently replaced the head of this region and appointed a former confidant of his former employer Sika to this post. Thus, while growth of 4.8% is already at the top of the target range of 3% to 5% for 2018, the difference in income is even greater, which Lafarge-Holcim will have to close down. 39, here the end of the year. ] Lafarge-Holcim earns a lot less. (Patrick B. Kraemer / Keystone) "/>
