Lafarge:Results as of June 30, 2013 Resilient Q2 Results Despite Particularly Adverse Weather Conditions Net Debt Reduction Objective Confirmed Performance and Innovation Objectives Confirmed Business Wire PARIS -- July 26, 2013 Regulatory News: Lafarge (Paris:LG) SECOND QUARTER KEY FIGURES *Sales down 3% to €4,112m *Current operating income down 11% to (stable like for like) €667m (-4% like for like) *EBITDA down 8% to €922m *Net result Group share at €201m (€0.70 (-3% like for like) per share), vs. €39m in Q2 2012 (€0.14 per share) FIRST-HALF KEY FIGURES *Sales down 5% to €7,248m *Current operating income down 22% to (-2% like for like) €791m (-12% like for like) *EBITDA down 14% to €1,302m *Net result group share at €84m (€0.29 (-9% like for like) per share), vs. €-21m in H1 2012 (€-0.07 per share) GROUP HIGHLIGHTS *Q2 EBITDA showed a good resilience, despite prevailing adverse weather conditions, notably in North America, the absence of CO sales and negative impact of foreign exchange. *Performance and innovation measures generated respectively €100 million and €60 million additional EBITDA in the quarter. In the first-half, we have generated a total of €260 million, on track with our plan. *EBITDA margin excluding CO was stable at constant scope and exchange rates in the quarter, supported by performance and innovation measures and price increases which offset the impact of lower volumes and cost inflation. *Net income Group Share in the quarter, at €201 million favorably compares to €39 million in Q2 2012 which was negatively impacted by exceptional items. *Net debt at the end of June decreased €0.7 billion compared to end of June last year, reflecting the strict control of investments and working capital optimization which supported the 35% free cash flow increase in the quarter. With the recently announced divestment of its US gypsum operations, the Group has secured €1.5billion^1 since the beginning of 2012, of which €0.9 billion will be received in H2. BRUNO LAFONT, CHAIRMAN AND CHIEF EXECUTIVE OFFICER OF LAFARGE, SAID: “Our results in the second quarter resisted in an environment which was marked by a conjunction of unfavorable circumstances. We increased prices and performance and innovation results are in line with our 2013 €650 million additional EBITDA target. Taking into account first-half volumes, we foresee a cement demand growth in our markets of between 0 to 3 percent in 2013, which implies more positive trends in the second half. We are fully mobilized to deliver on our strategy which objective is to create sustainable value for our shareholders. This means focusing on actions within our control, including through performance and innovation. Creating value also means we will continue the utmost discipline in terms of capital allocation as well as pursuing our portfolio optimization. And it starts with strengthening our financial structure, which means to be back to an investment grade status as quickly as possible, reducing net debt below €10 billion in 2013 and below €9 billion in 2014.” OUTLOOK Overall the Group sees cement growth in its markets of between 0 to 3 percent in 2013 versus 2012, factoring in low volumes in the first-half. Emerging markets continue to be the main driver of demand and Lafarge will benefit from its well-balanced geographic spread of high quality assets. We expect higher pricing for the year. Cost inflation will continue, although at a lower rate than in 2012, benefiting from positive trends in coal and petcoke prices. The Group targets to deliver additional EBITDA of €650 million in the year through its performance and innovation measures. Our objective is to reduce net debt to below €10 billion in 2013, and below €9 billion in 2014. CONSOLIDATED ACCOUNTS AS AT JUNE 30, 2013 The Board of Directors of Lafarge, chaired by Bruno Lafont, met on July 25, 2013 and approved the accounts for the period ended June 30, 2013. Further to their limited review of the interim condensed consolidated financial statements of Lafarge, the auditors have established a report, which is included in the half-year financial report. Second Quarter First-Half Variation Variation 2013 2012^(3) Gross Like for 2013 2012^(3) Gross Like for like^(4) like^(4) Volumes Cement (million 36.5 38.4 -5% -3% 65.2 69.7 -6% -4% tons) Pure Aggregates 50.9 51.0 - -1% 83.8 84.2 - -4% (million tons) Ready-Mix Concrete 8.3 8.6 -4% - 15.0 15.7 -5% -1% (million m^3) Results (million euros) Sales 4,112 4,261 -3% - 7,248 7,614 -5% -2% EBITDA^(1) 922 1,002 -8% -3% 1,302 1,513 -14% -9% EBITDA 22.4% 23.5% -110bps 18.0% 19.9% -190bps margin (%) Current Operating 667 750 -11% -4% 791 1,012 -22% -12% Income Net income Group 201 39 nm 84 (21) nm share Earnings per share 0.70 0.14 nm 0.29 (0.07) nm (€)^(2) Free cash 165 122 35% (132) (312) nm flow^(1) Net debt 11,881 12,550 -5% ^(1) EBITDA is defined as the current operating income before depreciation and amortization on tangible and intangible assets and free cash flow is the net cash generated or used in continuing operating activities less sustaining capital expenditures. They are both non-GAAP financial measures ^(2) Basic average number of shares outstanding of 287.3 million and 287.1 million for second quarter 2013 and 2012, and of 287.2 and 287.1 for the first-half 2013 and 2012 respectively. ^(3) 2012 figures have been restated further to the application of IAS19R. ^(4) At constant scope and exchange rates. EBITDA (*) RESULTS BY REGION (€m) Second Quarter First-Half Variation Variation Like Like 2013 2012 Gross for 2013 2012 Gross for like like ^(1) ^(1) North America 141 170 -17% -8% 129 128 1% 17% Western Europe 145 173 -16% -14% 150 255 -41% -38% Central and 80 101 -21% -21% 45 87 -48% -48% Eastern Europe Middle East and 304 329 -8% -1% 550 646 -15% -10% Africa Latin America 71 70 1% 7% 122 129 -5% 1% Asia 181 159 14% 16% 306 268 14% 17% TOTAL 922 1,002 -8% -3% 1,302 1,513 -14% -9% ^(*) EBITDA is defined as the current operating income before depreciation and amortization on tangible and intangible assets and is a non-GAAP financial measure. ^(1) At constant scope and exchange rates. SALES DEVELOPMENT AND FINANCIAL RESULTS Volumes declined in the second quarter, affected by a high comparable in 2012 and continuing adverse weather. Temporary fuel shortage in Egypt also put some pressure on volumes. Consolidated sales decreased 3% in the second quarter affected by adverse foreign exchange. At constant scope and exchange rates they were stable, as increased prices across all of our product lines to address cost inflation offset the impact of lower volumes. At constant scope and exchange rates, EBITDA declined by 3% with performance and innovation actions almost offsetting the impact of lower volumes and the absence of carbon credit sales in Q2 2013 (vs. CO proceeds of €24 million in Q2 2012). Net income Group Share in the quarter, at €201 million favorably compares to €39 million in Q2 2012, negatively impacted by a pre-tax impairment of €200 million recorded on Greek assets. Net debt declined by €0.7 billion relative to the end of June last year. Compared to year-end 2012, the increase has been strictly limited despite usual impact of seasonality. This reflects strict capex discipline, actions on working capital optimization and divestments. DIVESTMENTS AND INVESTMENTS Lafarge received €49 million in cash for divestments in the quarter. With the most recent divestments announced, the Group has secured €1.5 billion^1 of divestments since January 1^st 2012, of which €655 million have been received to date. The remainder will contribute to further debt reduction in 2013 and we will continue to pursue further value creative divestments in 2013. Investments totaled €230 million for the quarter. *Sustaining capital expenditures remained strictly constrained at €72 million. *Development investments amounted to €158 million in the second quarter of 2013, including mainly investments in our on-going new cement plant projects in Russia and India and in our plants of Exshaw and Ravena in North America. Going forward, the Group plans to continue to seize growth opportunities of our uniquely diversified portfolio, selectively investing in its core markets. ADDITIONAL INFORMATION The analyst presentation of results and the half-year financial report, including the interim management report and the condensed consolidated financial statements are available on the Lafarge Website: www.lafarge.com Practical information: There will be an analyst conference call at 9:00 CET, on July 26, 2013 hosted by Jean-Jacques Gauthier, Chief Financial Officer. The presentation will be made in English with slides that can be downloaded from the Lafarge website (www.lafarge.com). The presentation may be followed via an audiocast on the Lafarge website as well as via teleconference: - Dial in (France): +33(0)1 76 77 22 27 - Dial in (UK or International): +44(0)20 3427 1905 - Dial in (US): +1646 254 3366 Please note that in addition to the web cast replay, a conference call playback will be available until August 2, 2013 midnight at the following numbers: - France playback number: +33 (0)1 74 20 28 00 (pin code: 2958760#) - UK or International playback number: +44 (0)20 3427 0598 (pin code: 2958760#) - US playback number: +1347366 9565 (pin code: 2958760#) Lafarge’s next financial publication – 3rd Quarter 2013 results – will be on November 6, 2013 (before the NYSE Euronext Paris stock market opens). NOTES TO EDITORS A world leader in building materials, Lafarge employs 65,000 people in 64 countries, and posted sales of €15.8 billion in 2012. As a top-ranking player in its Cement, Aggregates and Concrete businesses, it contributes to the construction of cities around the world, through its innovative solutions providing them with more housing and making them more compact, more durable, more beautiful, and better connected. With the world’s leading building materials research facility, Lafarge places innovation at the heart of its priorities in order to contribute to more sustainable construction and to better serve architectural creativity. Since 2010, the Lafarge Group has been part of the Dow Jones Sustainability World Index, the first global sustainability benchmark in recognition of its sustainable development actions. More information is available on Lafarge's website: www.lafarge.com Important disclaimer - forward-looking statements: This document contains forward-looking statements. Such forward-looking statements do not constitute forecasts regarding results or any other performance indicator, but rather trends or targets, as the case may be, including with respect to plans, initiatives, events, products, solutions and services, their development and potential. Although Lafarge believes that the expectations reflected in such forward-looking statements are based on reasonable assumptions as at the time of publishing this document, investors are cautioned that these statements are not guarantees of future performance. Actual results may differ materially from the forward-looking statements as a result of a number of risks and uncertainties, many of which are difficult to predict and generally beyond the control of Lafarge, including but not limited to the risks described in the Lafarge’s annual report available on its Internet website (www.lafarge.com) and uncertainties related to the market conditions and the implementation of our plans. Accordingly, we caution you against relying on forward looking statements. Lafarge does not undertake to provide updates of these forward-looking statements. More comprehensive information about Lafarge may be obtained on its Internet website (www.lafarge.com), including under “Regulated Information” section. This document does not constitute an offer to sell, or a solicitation of an offer to buy Lafarge shares. ^1 Excluding €0.2bn capital injection of our new partner in India, as announced in May 2013 Contact: PRESS RELATIONS Christel des Royeries, +33 (0)1 44 34 19 47 Christel.firstname.lastname@example.org Anne Plaisance, +33 (0)1 44 34 18 18 Anne.email@example.com Caroline Winkler, +33 (0)1 44 34 11 70 Caroline.firstname.lastname@example.org or INVESTOR RELATIONS Stéphanie Billet, +33 (0)1 44 34 93 71 Stephanie.email@example.com Michael Bennett, +33 (0)1 44 34 11 51 Michael.firstname.lastname@example.org Laurence Le Gouguec, +33 (0)1 44 34 94 59 Laurence.email@example.com
Lafarge: Results as of June 30, 2013
Press spacebar to pause and continue. Press esc to stop.