HOLCIM LTD The Middle East Africa region showed resilient margins and recovery from the impact of COVID-19 by June. Volumes declined in Algeria, Egypt, Iraq and South Africa due to government restrictions and curfews. Ramadan in May slowed down the recovery in the respective countries. Nigeria delivered a resilient performance.
Middle East Africa H1 2020 H1 2019 +/-% +/-% LfL Sales of cement (mt) 15.6 17.6 -11.6 -11.6 Sales of aggregates (mt) 1.4 3.4 -60.1 -60.1 Sales of ready-mix concrete (m m(3) ) 1.2 1.9 -35.7 -35.7 Net sales to external customers (CHFm) 1,177 1,476 -20.3 -14.8 Recurring EBIT (CHFm) 137 193 -29.3 -27.0 Recurring EBIT margin (%) 11.5 13.0
North America
The North America region delivered a remarkable performance with a Recurring EBIT up 20 percent for the first half of 2020 over the prior-year period on a like-for-like basis. This leading performance amid COVID-19 was largely due to fast and effective cost management in the US, partly offset by the impact of lockdowns in Eastern Canada and the economic challenges facing Western Canada due to a slowdown in the oil & gas industry.
North America H1 2020 H1 2019 +/-% +/-% LfL Sales of cement (mt) 8.9 9.0 -1.4 -1.4 Sales of aggregates (mt) 45.2 45.7 -1.1 -0.6 Sales of ready-mix concrete (m m(3) ) 4.5 4.4 2.7 1.5 Net sales to external customers (CHFm) 2,566 2,645 -3.0 0.8 Recurring EBIT (CHFm) 260 225 15.6 19.7 Recurring EBIT margin (%) 10.1 8.5
RECONCILIATION TO GROUP ACCOUNTS
Reconciling measures of profit and loss to the LafargeHolcim Group's consolidated statement of income
H1 2020 H1 2019
Million CHF (Unaudited) (Unaudited)
Net sales 10,693 13,059
Recurring operating costs (8,717) (10,658)
Share of profit of joint ventures 176 272
Recurring EBITDA after leases 2,152 2,673
Depreciation and amortization of property, plant
and equipment, intangible and long-term assets (958) (1,007)
Recurring EBIT 1,194 1,667
Restructuring, litigation and other non-recurring
costs (39) (71)
Impairment of operating assets (151) (14)
Operating profit 1,005 1,581
H1 2020 H1 2019
Million CHF (Unaudited) (Unaudited)
Recurring EBITDA after leases 2,152 2,673
Depreciation of right-of-use assets 185 205
Recurring EBITDA 2,337 2,878
H1 2020 H1 2019
Million CHF (Unaudited) (Unaudited)
Recurring fixed costs (2,922) (3,436)
Recurring variable costs (5,795) (7,222)
Recurring operating costs (8,717) (10,658)
H1 2020 H1 2019
Million CHF (Unaudited) (Unaudited)
Net income 447 1,128
Impairment (143) (23)
Profit/(loss) on divestments (11) 265
Net income before impairment and divestments 601 886
Net income before impairment and divestments Group
share 501 769
Reconciliation of the Free Cash Flow after leases to the consolidated cash flows of the LafargeHolcim Group
H1 2020 H1 2019
Million CHF (Unaudited) (Unaudited)
Cash flow from operating activities 1,330 1,067
Purchase of property, plant and equipment (442) (647)
Disposal of property, plant and equipment 30 41
Repayment of long-term lease liabilities (169) (209)
Free cash flow after leases 749 252
Reconciliation of Net financial debt to the consolidated statement of financial position of the LafargeHolcim Group
H1 2020 H1 2019
Million CHF (Unaudited) (Unaudited)
Current financial liabilities 2,736 2,862
Long-term financial liabilities 11,697 12,886
Cash and cash equivalents 3,736 3,045
Short-term derivative assets 14 29
Long-term derivative assets 31 25
Net financial debt 10,652 12,650
NON-GAAP DEFINITIONS
Some non-GAAP measures are used in this release to help describe the performance of LafargeHolcim. A full set of these non-GAAP definitions can be found on our website.
Measures Definition
Like-for-like Like-for-like information is
information factoring out changes in
the scope of consolidation (such as
divestments and acquisitions occurring
in 2020 and 2019) and currency
translation effects (2020 figures are
converted with 2019 exchange rates in
order to calculate the currency
effects).
Recurring fixed costs Recurring fixed costs refer to all
recurring costs not directly related
to volumes such as Maintenance,
Personal costs in Production,
Administration, Marketing and Sales
Expenses, Third party services and
depreciation of right-of-use assets.
Recurring variable costs Recurring variable costs include
recurring operating costs directly
related to volumes such as raw
materials and finished goods
purchases, inventory variation,
energy, quarry outsourcing and
distribution costs. The addition of
variable and fixed recurring costs
equals the total recurring operating
costs.
Recurring operating costs The Recurring operating costs is an
indicator representing all recurring
costs. It is defined as: +/--
Recurring EBITDA after leases; -- net
sales; and -- share of profit of joint
ventures
Recurring EBITDA The Recurring EBITDA (earnings before
interest, tax, depreciation and
amortization) is an indicator to
measure the performance of the group
excluding the impacts of non-recurring
items. It is defined as: +/--
Operating profit (EBIT) -
depreciation, amortization and
impairment of operating assets -
restructuring, litigation and other
non-recurring costs
Recurring EBITDA Margin The Recurring EBITDA margin is an
indicator to measure the profitability
of the Group excluding the impacts of
non-recurring items. It is defined as
the Recurring EBITDA divided by net
sales.
Recurring EBITDA after leases The Recurring EBITDA after leases
(earnings before interest, tax,
depreciation and amortization) is an
indicator to measure the performance
of the Group including the impacts of
lease depreciation and excluding the
impacts of non-recurring items. The
Recurring EBITDA after leases is
defined as the Recurring EBITDA less
the depreciation of right-of-use
assets.
Recurring EBIT The Recurring EBIT is defined as
Operating profit/loss (EBIT) adjusted
for restructuring, litigation and
other non-recurring costs and for
impairment of operating assets. (MORE TO FOLLOW) Dow Jones Newswires
07-30-20 0045ET
