LafargeHolcim announces 2017 progress and new strategy to drive growth

LafargeHolcim has announced good progress for 2017 and has launched a five-year strategy targeting annual sales growth of 3 to 5%. The plan, according to Jan Jenisch, chief executive, would revitalise the group by allowing it to grow faster than the overall market while slashing costs.

The North American region had a quarter of strong growth with like-for-like Recurring earnings before interest, taxes, depreciation, and amortization (EBITDA) up 7% in the fourth quarter (Q4), compared with the same period in 2016 and 10.5% for the full year 2017.

Additionally, it revealed continued contribution from the US for the full year despite the decline in volumes. West Canada delivered improved results with early signs of recovery in the oil sector while East Canada increased its earnings contribution in a competitive environment.

Latin America delivered increases of more than 22% in like-for-like Recurring EBITDA for both the full year and Q4.

Argentina was a strong performer with commercial initiatives and operational execution underpinning record earnings for the year. Mexico had strong numbers which were supported by good execution of the commercial strategy while Brazil’s turnaround initiatives are said to have generated significant benefits in a constantly challenging environment.

The 1,000th Disensa franchise store was also opened in the region during Q4.

Jenisch said: “In 2017 we made good progress across all key metrics. The growth in sales and the over-proportional increase in EBITDA represent a good performance and give us a very good basis to build on. The fact that four of our five regions reported growing EBITDA is testimony to our global strength.”

The new CEO also stated: “Our new Strategy 2022 – ‘Building for Growth’ will allow us to more vigorously capture market opportunities, capitalising on the best assets in a growing building materials market. We have already started to create a leaner more agile organisation, moving considerably closer to our customers through the empowerment of the country management.

“The strategy is underpinned by a new set of targets that centres on growth, improving profitability, increasing cash generation and producing more attractive and sustainable returns for shareholders. Our vision is to be a global blue chip company in the attractive and growing building materials market.”

A full copy of the report and additional findings are available here.

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