Lafarge S.A.
Lafarge S.A.: 2005 NINE MONTHS SALES REPORT (Part 1/2)
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PRESS RELEASE
Euronext: LG, NYSE: LR Paris, October 20, 2005
2005 NINE MONTHS SALES REPORT
– Sales up 8.2% to EUR 11,759 million
– Positive pricing trends in most markets
– Our few difficult markets evolving as expected, however
with some weaker North American markets
Sales were up 8.2% to EUR 11,759 million as at September 30, 2005 compared to
EUR 10,870 million for the first nine months of 2004. The net scope effect was
at 0.6%. Foreign exchange variations impacted sales by 0.2%. Like for like
sales rose by 7.4% for the first nine months of the year and by 9.5% in the
third quarter.
“We are continuing to experience good overall pricing trends in most of our
markets, in a context of higher energy and transportation costs. The situation
in our few difficult markets is evolving as expected, with continued weakness
in Germany and, in cement, ongoing severe price competition in Brazil,
stabilization of prices in South Korea and prices back to their previous
levels in Malaysia. However, some North American markets (North East and the
Great Lakes) have recently appeared softer. In this context, our previously
stated full year expectation of like for like current operating income growth
now appears challenging” said Jean-Jacques Gauthier, Executive Vice President
and Chief Financial Officer.
The sales report for each division, excluding foreign exchange, scope effects,
and before inter divisional sales elimination is as follows:
CEMENT: +8.1% (+2.1% in Quarter 1, +9.9% in Quarter 2, + 10.8% in Quarter 3).
Cement sales grew 8.1% with a very good third quarter. Volumes, to date, are
1.2% ahead of the strong levels achieved in the same period of 2004. Year on
year price growth was significant, in an environment of higher energy and
transportation costs.
In Western Europe, sales are up overall with good growth in France and Spain.
Solid price improvements were experienced in Germany and the UK. The favorable
pricing trends across much of the region served to offset the lower volumes
in Germany, Greece and the UK.
North America posted strong sales, with strong price increases throughout the
first nine months. Volumes growth in our Western, River and Southeastern
markets have more than compensated for weaker Northeastern and Lakes markets.
Sales in Eastern Europe are well ahead of last year’s with a very strong third
quarter. Romania, Serbia and Russia continue to post robust sales, with
strong pricing performance in Russia and Serbia. Poland had a strong third
quarter, however its market remains uncertain and year-to-date volumes are
still below 2004 levels.
Strong sales growth was recorded in the Mediterranean Basin particularly in
Jordan, Turkey, Egypt and with an improving trend in Morocco.
In Africa, sales benefit from favourable volume trends, particularly in Kenya
and South Africa. Prices were up in all markets along within the rise in input
costs.
Sales evolution in Asia remain very contrasted. Volumes grew in India and
Malaysia but stayed weak in South Korea and the Philippines. The overall
decline in sales is attributable to the severe price conditions experienced in
Malaysia and South Korea in the first half. During the third quarter,
however, prices are back to their previous levels in Malaysia and have
stabilized in South Korea.
In Latin America, sales are slightly down, essentially reflecting the ongoing
severe price competition in Brazil. On the other hand, Venezuela and Chile
continued to show good improvement.
AGGREGATES & CONCRETE: +10.0% (+4.5% in Quarter 1, +13.6% in Quarter 2,
+10.2% in Quarter 3 )
The strong growth in Aggregates and Concrete has been driven by continued
solid pricing gains in a context of rising costs throughout most markets and
good volumes, in the second and third quarters.
Aggregates sales growth were particularly robust in North America, driven by
favorable prices and volumes. In Western Europe, sales are up as a result of
good pricing trends, although volumes remain down after the weak, weather
impacted, first quarter and a decline of the UK market. Good market conditions
were seen in the majority of our emerging markets. The Asphalt and Paving
activity, driven in North America and the UK by volumes and prices, improved
from 2004 levels.
In Concrete, sales increased strongly in Western Europe, driven by favorable
pricing actions, product and customer mix and strong volumes in all markets
but Greece. In North America good price and product mix improvements more than
offset the decline in volumes. We also saw strong increase in most emerging
countries, particularly in Latin America, Africa and Asia.
ROOFING: -3.4% (-9.1% in Quarter 1, -3.8% in Quarter 2, +0.8% in Quarter 3)
In Western Europe, over the nine months, sales are down in most countries,
with the exception of Italy and Scandinavia. The severe drop in volumes and
prices in Germany continued through the third quarter although the gap from
last year is reducing. Good housing market conditions continued to drive sales
growth in the United States, both in volumes and prices.
GYPSUM: +7.4% (+4.5% in Quarter 1, +9.7% in Quarter 2, +7.6% in Quarter 3)
The increase in sales was largely driven by favorable market conditions in
North America, resulting in successful price increases and volume growth.
Sales volumes in Western Europe were relatively flat, pulled down by Germany,
but positive pricing contributed to increase sales. In Asia sales declined,
mainly as a result of a weaker market in South Korea.
POSITIVE FOREIGN EXCHANGE IMPACT OF +0.2% AMOUNTING TO EUR 23 MILLION
The positive foreign currency translation impact on sales was limited, with
the decline in the US Dollar versus the euro being more than offset by the
appreciation of several other currencies (in particular, the Canadian dollar,
the South Korean won and the Polish zloty).
SCOPE CHANGES OF +0.6% AMOUNTING TO EUR 70 MILLION
Sales from acquisitions amounted to a positive scope effect of EUR 154 million
largely due to the acquisition of Cementos Selva Alegre in Ecuador in
December 2004, of Hupfer Holdings in France (May 2004) and of the assets of
The Concrete Company in the United States (April 2004). The negative scope
effect, stemming mostly from disposals in the UK and North America, totaled
EUR 84 million.
(End part 1/2)
End of announcement (c)DGAP 20.10.2005
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WKN: 850646; ISIN: FR0000120537; Index:
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201039 Okt 05
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