Like-for-like Net Sales were up 3.1 percent to CHF 5,830 million driven by growth in cement volumes in Q1. Recurring EBITDA was down by 7.7 percent on a like-for-like basis, affected by the especially harsh winter in North America and Europe.
Broadly, the underlying market trends seen at the end of 2017 continued into the first three months of 2018. Latin America continued its positive development with top and bottom line growth. In North America, the Group is well positioned to take advantage of good market conditions despite the effect of a particularly harsh winter. Strong performance in China and India contributed to growth in the Asia Pacific region. In contrast, Middle East Africa underperformed with challenging conditions in some markets. In Europe, where underlying demand was good, first
quarter performance reflected adverse weather, fewer working days and higher maintenance activity in preparation for high season growth.
Jan Jenisch, Group Chief Executive Officer of LafargeHolcim said: “Q1 was a good start to the year. The continued growth in the top line is encouraging and confirms the positive outlook for our businesses. Though the quarter was affected by several headwinds, we expect the strength of our portfolio and the benefits of our new strategy to become increasingly visible over the full year. That makes us confident we will deliver on our 2018 targets.
“We are executing our Strategy 2022. Our new organization is getting us closer to our markets and we are making good headway on simplifying our business, a critical factor in the future success of LafargeHolcim.”
The Strategy 2022 – “Building for Growth” was launched in March and the Group is now executing at full speed. The recent bolt-on acquisition in Aggregates and Ready-mix Concrete in the UK is delivering immediate value while expansion plans in the growing markets of India and Argentina are being implemented. Further progress has been made to simplify the organization with a performance management system, fully aligned with the strategy, now in place.
The Group confirms its targets for 2018 for Net Sales growth of 3 to 5 percent and an overproportional increase in Recurring EBITDA of at least 5 percent on a like-for-like basis.
Market demand in Latin America is expected to be up in most countries.
Further market growth is anticipated in North America driven by residential and nonresidential demand.
The Group expects sustained market demand supported by infrastructure and residential growth in India, while in China favourable market conditions are expected to remain. In South East Asia, the market environment will generally remain challenging although demand outlook is encouraging.
The environment for building materials is positive across most markets in Europe.
The overall outlook for Middle East Africa is mixed and the region continues to be affected by challenging markets.
The Board of Directors will submit a proposal for shareholder approval at today’s AGM on May 8, 2018, for a dividend of CHF 2 per share, stable compared to the prior year.