VICAT : First-Quarter 2011 Sales Rise 28.8%, an 18.2% Increase at Constant Scope and Exchange Rates

Regulatory News:

• An excellent quarterly performance, that cannot be extrapolated for the full year due to the particularly clement weather conditions in Europe
• Confirmation of a gradual economic recovery in mature countries
• Ongoing dynamic growth in emerging countries, with the exception of Egypt
• Very solid balance sheet

Vicat (Paris:VCT) (NYSE Euronext Paris: FR0000031775 - VCT) today reports first-quarter 2011 sales of ?513 million, up 28.8%. At constant scope and exchange rates, sales increased by 18.2% relative to first-quarter 2010.

Consolidated sales by business unit:

(? million)		31 March 2011		31 March 2010		Variation (%)
						Reported		At constant scope and exchange rates
Cement		267		214		+24.8%		+10.9%
Concrete & Aggregates		180		136		+32.0%		+24.9%
Other Products & Services		66		48		+37.1%		+31.5%
Total		513		398		+28.8%		+18.2%

Commenting on these figures, the Management Board stated:

"Vicat achieved very strong volume growth in its activity during the first quarter of 2011. In Europe, a dynamic sector environment and particularly favourable weather conditions fuelled a significant rebound in Group activity. In the United States, signs of a very gradual recovery seem to be confirmed, although they are still fragile. In the emerging markets, business remained buoyant, bolstered by strong sales trends in Western Africa, India and Turkey. In Egypt, the market slowed slightly due to recent political events, although Vicat reported a satisfactory level of business considering the circumstances. All these performances highlight the pertinence of the Group's well-balanced business model as well as its investments over the past four years. As a result, Vicat is in a good position to fully benefit from the return to better economic conditions."

In this press release, and unless stated otherwise, all changes are expressed on an annual basis (2011 versus 2010), as well as at constant scope and exchange rates.

Consolidated sales amounted to ?513 million in first-quarter 2011, up 28.8% compared with the year-earlier period, an 18.2% increase at constant scope and exchange rates.
Over the same period, Cement division sales rose 10.9% at constant scope and exchange rates, Concrete & Aggregates sales rose 24.9%, and Other Products and Services rose 31.5%.

The breakdown of first-quarter sales by division shows a decline in the contribution of the Cement division, which accounted for 52% of consolidated sales, down from 54% at 31 March 2010. Concrete & Aggregates accounted for 35% of consolidated sales compared with 34% in the year-earlier period. The contribution of Other Products and Services increased to 13% of sales from 12% at 31 March 2010.

Several factors fuelled the Group's sales growth in the first quarter of 2011, including the persistently dynamic momentum of the emerging markets, with the exception of Egypt; improving economic conditions in the mature countries and the impact of clement weather conditions in Europe, which were more favourable than in first-quarter 2010.

1. Regional breakdown of consolidated first-quarter sales

1.1. France

(? million)		31 March 2011		31 March 2010		Change (%)
						Reported		At constant scope
Consolidated sales		222		173		+28.7%		+26.8%

In the first quarter ended 31 March 2011, consolidated sales in France rose 26.8% to ?222 million. This performance stems from particularly favourable weather conditions relative to first-quarter 2010 and from a trend improvement in market conditions.

By division:

• In Cement, consolidated sales rose 24.8%. Volume growth was very strong in the first quarter, up 20.5%. On the domestic market, sales in volume rose nearly 32%. The increase in volumes in the domestic market reflects several factors: a more favourable sector environment, a catching-up effect after a fourth-quarter 2010 marked by heavy rain, notably in the Rhône-Alpes region, and clement weather conditions, notably compared to first-quarter 2010. Average selling prices increased by about 4% compared to first-quarter 2010, a strong performance mainly due to a significant increase in export prices. Selling prices in the domestic market declined very slightly due to unfavourable product and geographical mixes. Note that price negotiations launched at the beginning of the year had little impact on the first quarter of 2011.
• In Concrete & Aggregates, consolidated sales rose 27.3%, more or less in line with the performance of the Cement division. Concrete sales increased by nearly 30% in volume while Aggregate sales rose by about 39%. The average invoiced sales price rose nearly 3% in Aggregates but continued to decline slightly in Concrete.
• In Other Products and Services, consolidated sales rose 29.4%. Building Chemicals sales increased 7.6% while the Transport business increased 65.2% under the combined impact of the recovery in the current economic environment and better weather conditions.

1.2. Europe (excluding France)

(? million)	31 March 2011	31 March 2010	Change (%)
			Reported	At constant scope and exchange rates
Consolidated sales	79	52	+53.3%	+30.3%

In first-quarter 2011, consolidated sales in Europe (excluding France) increased by 30.3% to ?79 million.

In Switzerland, consolidated first-quarter 2011 sales rose 33.1%, lifted by a buoyant market benefitting from favourable weather conditions.

• In Cement, volumes rose by more than 24% as the Group benefited fully from ongoing shipments to large-scale infrastructure projects, a booming residential market and very favourable weather conditions. Under this environment, selling prices increased by about 3%. Considering these elements and the increase in the level of sales to the Group's Concrete network, consolidated sales after inter-company elimination, posted 16% growth.
• In Concrete & Aggregates, consolidated sales increased by 48.5%. Volumes were largely driven by the dynamic momentum of the market as well as by very favourable weather conditions. As to average selling prices, ex-works prices in Concrete rose in line with those of the Cement division, while Aggregate prices remained flat.
• Precast sales increased by 36.5% buoyed by a big increase in volumes.

In Italy, sales increased by 3.3%, lifted by strong volume growth. This performance signals a recovery in the construction business in Italy, which also benefited from favourable weather conditions. Although average invoiced prices declined sharply compared to first-quarter 2010, they were up strongly compared to fourth-quarter 2010.

1.3. United States

(? million)		31 March 2011		31 March 2010		Change (%)
						Reported		At constant scope and exchange rates
Consolidated sales		36		35		+1.6%		+0.3%

In the United States, business continued to be undermined by persistently tough economic conditions. Yet in line with trends observed in late 2010, the signs of a very gradual recovery were confirmed, even though they are still very fragile.

Under this environment, Group sales were flat compared to first-quarter 2010.

• In Cement, consolidated sales contracted by 9.6%, undermined by significantly lower prices than those reported in first-quarter 2010, in both California and Alabama. Yet in keeping with the trends observed in late 2010, prices were generally flat on a sequential basis, notably in California. The Group swung back into very slight volume growth, up nearly 1% for the region as a whole. This performance reflects a slight increase in volumes in California with a trend that was stronger in January and February while March was hit by heavy rains. Over the same period, volumes contracted very slightly in the South-East.
• In Concrete, consolidated sales rose 5%. This trend reflects a significant improvement in volumes, up by more than 13%, in both the South-East and California. Like the Cement division, selling prices in the first quarter were significantly lower than in the year-earlier period. On a quarterly basis relative to the fourth quarter, in contrast, prices were flat in California and declined very slightly in the South-East.

1.4. Turkey, India and Kazakhstan

(? million)		31 March 2011		31 March 2010		Change (%)
						Reported		At constant scope and exchange rates
Consolidated sales		65		32		+102.3%		+11.9%

Consolidated sales for the region as a whole rose 11.9% to ?65 million.

Consolidated sales in Turkey increased 8.8% to ?34 million.

• In Cement, volumes declined 3.4%. This performance reflects an increase in volumes in the domestic market and a sharp decline in export sales as the Group favoured the local market over export markets. Under this environment, selling prices increased strongly. On this basis, the consolidated sales for this activity posted a very slight decrease of around -1%.
• In Concrete, consolidated sales rose 22.3% due to a slight increase in volumes and a very big increase in average selling prices.

In India, the Group reported first-quarter 2011 sales of ?30 million, compared to ?47 million in the 8-month period between 1 May 2010 (consolidation of Bharathi Cement) and 31 December 2010. The Group confirms its excellent performance in India with the ongoing ramping up of Bharathi Cement's modern production facilities. During the first quarter, volumes amounted to more than 500,000 tonnes of cement. This success validates the Group's strategy of marketing premium cement, capitalising on its well-known brand name and solid distribution network covering the entire south of India. As to selling prices, after a sharp decline during the monsoon period in third-quarter 2010, trends reversed and the strong recovery initiated in fourth-quarter 2010 extended into first-quarter 2011.

In Kazakhstan, the Group continued to ramp up production at the factory that started up last December. With the return of milder weather conditions, the Jambyl Cement plant marketed the first tonnage produced at the plant with the delivery of 26,000 tonnes at the end of the quarter. Production and marketing should continue to be ramped up at a much faster pace with the arrival of the spring season.

1.5. Africa and the Middle East

(? million)		31 March 2011		31 March 2010		Change (%)
						Reported		At constant scope and exchange rates
Consolidated sales		111		107		+3.9%		+6.0%

In Africa and the Middle East, consolidated sales rose 6% to ?111 million.

• In Egypt, consolidated sales fell by 9.7% to ?42 million. This contraction can be attributed to a sharp 3.7% decline in volumes and a sharp drop in selling prices due to the political turmoil in Egypt. Yet this situation was only temporary and the Egyptian market recovered part of its dynamic momentum by March 2011, even though average daily volumes sold are still lower than pre-crisis levels. The pricing environment is also slightly more favourable. Management is still confident in market trends in Egypt as well as in the Group's ability to fully benefit from this growth.
• In West Africa, consolidated sales increased by 19.2% compared to first-quarter 2010. Volumes rose strongly, by more than 22%, which largely offset the decline in average selling prices, eroded by an unfavourable regional mix due to a strong increase in export sales. The Group continued to successfully promote the regional diversification of sales while drawing on the performance of its production facilities.

2. First-quarter sales at 31 March 2011 by division

2.1.Cement

(? million)		31 March 2011		31 March 2010		Change (%)
						Reported		At constant scope and exchange rates
Volume ('000 tonnes)		4,020		3,209		+25.3%
Operational sales		316		251		+26.0%		+13.8%
Intra-group sales		(49)		(37)
Consolidated sales		267		214		+24.8%		+10.9%

Consolidated sales rose by 24.8% in the Cement division, a 10.9% increase at constant scope and exchange rates. Volumes increased by 25.3% over the period.

2.2.Concrete & Aggregates

(? million)		31 March 2011		31 March 2010		Change (%)
						Reported		At constant scope and exchange rates
Concrete volume ('000 m3)		1,770		1,450		+22.1%
Aggregates volume ('000 tonnes)		5,056		3,701		+36.6%
Operational sales		186		143		+30.4%		+23.5%
Intra-group sales		(6)		(7)
Consolidated sales		180		136		+32.0%		+24.9%

Consolidated sales rose 32.0% in the Concrete & Aggregates division, a 24.9% increase at constant scope and exchange rates. In volume terms, shipments of concrete and aggregates increased by +22.1% and 36.6%, respectively, over the period.

2.3.Other Products and Services

(? million)		31 March 2011		31 March 2010		Change (%)
						Reported		At constant scope and exchange rates
Operational sales		86		62		+37.2%		+32.9%
Intra-group sales		(20)		(14)
Consolidated sales		66		48		+37.1%		+31.5%

In Other Products and Services, consolidated sales rose 37.1% in first-quarter 2011, up 31.5% at constant scope and exchange rates.

3. Changes to the consolidated financial position at 31 March 2011

3.1 Operating margin

The Group points out that the first quarter is not historically representative of its performance over the full year.

In 2011, several factors will have a negative effect on the Group's Ebitda margin:

• Start-up costs and the ramping up of the Bharathi Cement plant in India and the Jambyl Cement plant in Kazakhstan,
• The impact of recent events in Egypt. Moreover, in 2011, the Group will not benefit from non-recurring income of ?18 million reported in 2010 for the retroactive revision of the amount of a cement tax per tonne,
• A slight increase in energy costs, mainly due to higher electricity prices in some countries.

In contrast, the following factors will have a positive impact on the Group's Ebitda margin:

• The gradual recovery in business in the mature countries,
• The ongoing strong momentum in the emerging markets, with the exception of Egypt,
• And ongoing efforts to boost productivity gains and reduce fixed expenditure, as well as the combined impact of the Performance plans.

After taking into account all these factors, the Group expects the full-year 2011 Ebitda margin to be slightly lower than in 2010.

3.2. Financial position

The consolidated net debt to equity ratio was 43% at 31 March 2011, compared to 39% at 31 December 2010. After the acquisition of a 51% stake in the Bharathi Cement Company Limited in 2010, the Vicat Group is still in a very healthy financial position.

Given the Group's low debt, the existence of bank covenants does not constitute a risk to its financial position and the liquidity of its balance sheet. At 31 March 2011, Vicat respects all of the financial ratios required by the covenants contained in its financing agreements.

4. Outlook for 2011

For 2011, the Group wishes to provide the following information concerning its various markets:

• In France, the Group anticipates a gradual recovery in volumes during 2011, with prices expected to stabilise or increase very slightly.
• In Switzerland, the environment is likely to remain broadly positive, with support coming from the ongoing major infrastructure projects and pricing levels that are expected to improve slightly.
• In Italy, the Group anticipates that the situation is likely to remain difficult, with an unfavourable competitive environment. Even so, given the current levels of cement consumption, volumes should gradually stabilise and prices should rise.
• In the United States, even though visibility remains very limited on both the macroeconomic front and the likely level of investment by states, the Group anticipates a very gradual improvement in its markets, in terms of both volumes and pricing with the return to strong growth rates not expected before 2013.
• In Turkey, the improvement in the environment in 2010 is likely to continue during 2011. Against this backdrop, the Group should be able to take full advantage of the efficiency of its production facilities as a result of its investments under the "Performance 2010" plan.
• In Egypt, the Group wishes to state that its manufacturing base has not been affected by recent events and that to date the plant has been operating normally. The Group remains confident about the performance of the Egyptian market and in its ability to reap the full benefit of its expansion.
• In West Africa, the market environment is likely to remain broadly positive, but will remain closely linked to investments by government authorities in major infrastructure projects and also to trends in money transfers from West Africans living abroad. Leveraging on its fully modernised and efficient production facilities, the Group will continue to pursue its expansion efforts across the entire region of West Africa.
• In India, the acquisition of a majority shareholding in Bharathi Cement and the start-up of its second production line in late 2010 have enabled the Group to strengthen significantly its position in India, a market in which cement consumption is experiencing strong growth. This partnership, which represents Vicat's second major transaction with its existing joint venture Vicat Sagar Cement, will give rise to two major players in southern India, addressing complementary markets, able to draw on substantial business synergies and ultimately possessing total nominal capacity of over 10 million tonnes.
• In Kazakhstan, Vicat is pleased with the start-up of the 1.1 million tonnes capacity Jambyl Cement plant during December. Thanks to its ideal geographical location and highly effective production base, the Group should gradually be able to take full advantage of a market poised for solid growth in the construction and infrastructure sector and in a pricing environment that should remain well oriented.

Against this backdrop, Vicat is determined to continue prudently with its growth strategy, which is supported by:

• its solid financial structure,
• the benefits of the Performance plan, particularly lower production costs resulting from the modernisation of its production facilities and the strengthening of its industrial and commercial positions.
• and, lastly, its expansion in Kazakhstan and India.

5. Conference call

With the release of the Group's first-quarter 2011 sales, Vicat is organising a conference call that will take place in English on Wednesday, 4 May 2011, at 3 p.m. Paris time (2 p.m. GMT and 9 a.m. EST).

To take part in the conference call live, dial one of the following numbers:

France:			[phone]
United Kingdom:			[phone]
United States:			[phone]

To listen to a playback of the conference call, which will be available until midnight on 11 May 2011, dial one of the following numbers:

France:			[phone]
United Kingdom:			[phone]
United States:			[phone]
Access code:			4440272#

Shareholder events :
6 May 2011 (2 p.m.): Annual General Meeting of Shareholders

Next publication:
4 August 2011 (after the market closes): First-half 2011 sales and earnings report

ABOUT VICAT

The Vicat Group has 7,369 employees working in three core divisions, Cement, Concrete & Aggregates and Other Products & Services, which generated consolidated sales of ?2,014 million in 2010.
The Group operates in eleven countries: France, Switzerland, Italy, the United States, Turkey, Egypt, Senegal, Mali, Mauritania, Kazakhstan and India. Nearly 59% of sales are generated outside France.
The Vicat Group is the heir to an industrial tradition dating back to 1817, when Louis Vicat invented artificial cement. Founded in 1853, the Vicat Group now operates three core lines of business: Cement, Ready-Mixed Concrete and Aggregates, as well as related activities.

Disclaimer:
This press release may contain forward-looking statements. Such forward-looking statements do not constitute forecasts regarding results or any other performance indicator, but rather trends or targets.
These statements are by their nature subject to risks and uncertainties as described in the Company's annual report available on its website (www.vicat.fr). These statements do not reflect the future performance of the Company, which may differ significantly. The Company does not undertake to provide updates of these statements.
Further information about Vicat is available from its website (www.vicat.fr)

Vicat Group - Financial Information - Appendix

Breakdown of sales by business and region at 31 March 2011

		Cement		Concrete & Aggregates		Other Products & Services		Intra-group sales		Consolidated sales
France		102		107		63		(50)		222
Europe (excluding France)		36		31		22		(10)		79
United States		17		25				(6)		36
Turkey, Kazakhstan, India		54		19		1		(9)		65
Africa and Middle East		107		4						111
Operational sales		316		186		86		(75)		513
Intra-group sales		(49)		(6)		(20)		75
Consolidated sales		267		180		66				513

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A FRENCH REGISTERED COMPANY WITH SHARE CAPITAL OF ?179,600,000
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