Cie. de Saint-Gobain SA, Europe’s biggest supplier of building materials, reported 2013 profit that missed estimates and predicted an improvement in operating income in 2014 on demand from the U.S. and emerging markets.
Net income fell 14 percent to 595 million euros ($818 million) last year as it wrote down the value of assets, the company, based in Courbevoie near Paris, said in a statement today. Analysts predicted a profit of 867 million euros, according to the average of nine estimates compiled by Bloomberg.
“Amid signs of an improvement in the macroeconomic climate, we continued to cut costs while successfully maintaining our price-focused policy,” Chief Executive Officer Pierre-Andre de Chalendar said in the statement. “In 2014, trends for our different markets should improve even though the climate is likely to remain uncertain, and we expect a clear like-for-like improvement in operating income.”
Saint-Gobain is cutting costs and selling businesses to adjust to the European car and construction slump that has hurt demand for flat glass and building materials and put the company’s credit rating under pressure. Moody’s Investors Service and Standard & Poor’s, which rate Saint-Gobain at Baa2 and BBB respectively, have said they may downgrade the company.
Recurring net income fell 2.5 percent last year to 1.03 billion euros, in line with estimates of 1.01 billion euros.
Saint-Gobain plans to pay a dividend of 1.24 euros per share this year, unchanged from last year.
Saint-Gobain aims to complete the $1.7 billion sale of the North American assets of its glass bottle-and-jar unit Verallia to Ardagh Group SA in the first half. Saint-Gobain may later sell the rest of division on the stock market, the CEO said in November.