TIDMCOD
RNS Number : 3021M
Compagnie de Saint-Gobain
26 April 2018
PRESS RELEASE
Paris, April 26, 2018
First-quarter 2018 sales
EUR9,755 million
Organic growth of 1.6%
-- Positive price trend of 2.1%
-- Volumes down 0.5% impacted by a c.2% negative calendar impact
and unfavorable weather conditions
-- Strong 4.7% negative currency impact mainly due to the
depreciation of the US dollar and certain Asian and emerging
country currencies
-- Positive 1.3% structure impact reflecting the rise in the Group's acquisitions activity
Pierre-André de Chalendar, Chairman and Chief Executive Officer
of Saint-Gobain, commented:
"In the first quarter, the Group demonstrated its ability to
raise sales prices amid ongoing raw material and energy cost
inflation. Weather conditions and fewer working days distort the
interpretation of our performance at the start of the year.
Underlying trends nevertheless confirm the improvement of our
markets in most of our countries in Europe, particularly France, as
well as good momentum in North America and emerging countries. As
announced, the Group has continued to step up its capital
expenditure since the beginning of the year, along with its active
strategy of small and mid-sized acquisitions (nine acquisitions to
date for around EUR300 million). For 2018 as a whole, we confirm
our objective of a further like-for-like increase in operating
income."
On a like-for-like basis, sales grew by 1.6%. Prices continued
to rise (up 2.1%) against a higher comparison basis. Volumes
declined 0.5%, hit by a negative calendar impact of around 2% and
by harsh weather conditions, especially in Europe and in March.
North America, Asia and emerging countries enjoyed further good
growth momentum.
On a reported basis, sales totaled EUR9,755 million, with a
strong negative 4.7% currency impact notably due to the
depreciation of the US dollar, Brazilian real, Nordic krona and
other Asian and emerging country currencies against the euro.
The Group structure impact added 1.3% to sales growth and mainly
reflects the consolidation of companies in Asia and emerging
countries (KIMMCO, Tumelero, Megaflex, Isoroc Poland), in new niche
technologies and services (TekBond, Maris, Scotframe), and to
consolidate our strong positions (Glava, Biolink, Kirson, Wattex,
SimTek, bolt-on acquisitions in Building Distribution).
EURm Sales Sales Change Change Like-for-like
Q1 Q1 on an on a comparable change
2017 2018 actual structure
structure basis
basis
------ ------ ----------- ----------------- --------------
Sector and division:
Innovative Materials(a) 2,606 2,550 -2.1% -2.6% 3.7%
Flat Glass 1,426 1,384 -2.9% -3.1% 0.9%
High-Performance
Materials 1,184 1,173 -0.9% -1.7% 7.3%
Construction Products(a) 3,104 3,054 -1.6% -3.9% 3.2%
Interior Solutions 1,707 1,748 2.4% -0.8% 4.6%
Exterior Solutions 1,419 1,331 -6.2% -7.6% 1.6%
Building Distribution 4,483 4,399 -1.9% -2.7% -0.7%
Internal sales and
misc. -256 -248 --- --- ---
Geographic area:
France 2,637 2,673 1.4% 1.3% 1.3%
Other Western European
countries 4,241 4,166 -1.8% -3.4% -1.1%
North America 1,398 1,275 -8.8% -9.0% 4.6%
Emerging countries
and Asia 2,174 2,184 0.5% -2.0% 6.8%
Internal sales -513 -543 --- --- ---
-------------------------- ------ ----------- ----------------- --------------
Group Total 9,937 9,755 -1.8% -3.1% 1.6%
-------------------------- ------ ------ ----------- ----------------- --------------
(a) Including inter-division eliminations.
Like-for-like performance of Group Business Sectors
Innovative Materials sales rose 3.7%.
- Flat Glass delivered 0.9% growth, hit by the negative calendar
impact and unfavorable weather conditions in Europe which led to
delays in construction projects, as well as float glass plant
repairs. Asia and emerging countries advanced in the construction
sector, including in Brazil. As expected in Europe, the rise in
prices was driven by transformed glass; float prices were up
slightly. In markets that continue to grow, the automotive business
stabilized, temporarily impacted by the step-up in capex and
innovation.
- High-Performance Materials (HPM) continued to report buoyant
growth at 7.3%, led by Ceramics in particular. This performance was
driven by all geographies, with a strong dynamic in the US as well
as in Asia and emerging countries.
Construction Products (CP) delivered 3.2% sales growth despite a
negative calendar impact. The price effect continued its strong
rise, except for Exterior Products in the US.
- Interior Solutions sales climbed 4.6% driven by Asia and
emerging countries. Trading in Western Europe was partly affected
by weather conditions, although the underlying growth trends were
good except in the UK. North America posted further growth, led by
prices. Overall, the business continued to show the good pricing
dynamic of the fourth quarter.
- Exterior Solutions sales rose 1.6%. Exterior Products in North
America were up slightly against a high comparison basis, with
first-quarter 2017 boosted by distributor stockpiling; the price
effect stabilized. The Pipe business successfully increased prices,
while volumes remained difficult despite some signs of an
improvement in the export market. Mortars reported slight growth
hit particularly by bad weather in Europe, while Asia and emerging
countries continued to enjoy bullish growth overall.
Building Distribution sales slipped 0.7%, including a negative
calendar impact of around 2% and a strong negative impact due to
weather conditions in Europe. Harsh weather affected all of our
main countries, with construction projects delayed. Trading in
France continued to recover with good momentum in new-builds and
progress in renovation. Nordic countries continued to see good
underlying growth despite the negative impacts of the first quarter
(working days and weather). UK volumes continued to deteriorate,
partly offset by a strong price effect. Germany was hit especially
by poor weather in March. Trading remained weak in Brazil.
Like-for-like analysis by region
France (up 1.3%) confirmed its improvement excluding the
calendar impact despite the harsh weather conditions. Sales were
buoyed by dynamic new-build activity and by progress in
renovation.
Other Western European countries (down 1.1%) were also impacted
by a negative calendar impact and by particularly severe winter
weather in Germany, the Nordic countries and the UK. Snow and
freezing conditions delayed construction projects and affected
delivery times. However, underlying trends remain well-oriented in
our main countries, with the exception of the UK which saw a
further decline in volumes partly offset by a supportive price
environment.
North America posted 4.6% growth led by ongoing good momentum in
industrial markets. The construction market continued to trend
well, with an increase in pricing, particularly in Interior
Solutions.
Asia and emerging countries continued to expand, delivering
robust 6.8% organic growth. All regions drove this growth,
including Brazil which improved overall.
2018 outlook
The Group confirms its outlook for full-year 2018:
- further growth in France, led by the new-build market and by progress in renovation;
- progression in other Western European countries, despite continued uncertainty in the UK;
- growth in North America, in both construction markets and industry;
- good momentum in Asia and emerging countries.
The Group's strategic priorities as defined in February
remain:
- its focus on sales prices amid continued inflationary pressure on costs;
- its cost savings program with the aim of unlocking additional
savings of around EUR300 million (calculated on the 2017 cost
base);
- its capital expenditure program of around EUR1.7 billion
(representing around 4% of sales, in line with our objectives),
with a focus on growth capex outside Western Europe and also on
productivity (Industry 4.0) and digital transformation,
particularly in Building Distribution;
- its commitment to invest in R&D to support its differentiated, high value-added strategy;
- its focus on high levels of free cash flow generation.
In line with our objective as announced in February, the Group
is targeting a further like-for-like increase in operating income
in 2018.
Glossary:
Indicators of organic growth and like-for-like changes in
sales/operating income reflect the Group's underlying performance
excluding the impact of:
-- changes in Group structure, by calculating the indicators for
the year under review based on the scope of consolidation of the
previous year (Group structure impact);
-- changes in foreign exchange rates, by calculating the
indicators for the year under review and those for the previous
year based on identical foreign exchange rates for the previous
year (currency impact);
-- changes in applicable accounting policies.
Operating income: details are given in Note 3 to the financial
statements in the 2017 Registration Document, available on
https://www.saint-gobain.com/sites/sgcom.master/files/saint-gobain_document_de_reference_2017_va.pdf
Free cash flow: cash flow excluding the tax impact of capital
gains and losses on disposals, asset write-downs and material
non-recurring provisions, less capital expenditure.
Capital expenditure: investments in property, plant and
equipment.
Financial calendar
- First-half 2018 results: July 26, 2018, after close of trading
on the Paris Bourse.
Analyst/Investor relations Press relations
----------------------------------------- ------------------------------------------------------------
+33 1 47 62 +33 1 47 62
44 29 30 10
Vivien Dardel +33 1 47 62 Laurence Pernot +33 1 47 62
Floriana Michalowska 35 98 Susanne Trabitzsch 43 25
------------------------ --------------- -------------------------------------------- --------------
A conference call will be held at 6:30pm (Paris time) on April
26, 2018: +33 1 72 72 74 03, dial-in code: 80327596#
Important disclaimer - forward-looking statements:
This press release contains forward-looking statements with
respect to Saint-Gobain's financial condition, results, business,
strategy, plans and outlook. Forward-looking statements are
generally identified by the use of the words "expect",
"anticipate", "believe", "intend", "estimate", "plan" and similar
expressions. Although Saint-Gobain believes that the expectations
reflected in such forward-looking statements are based on
reasonable assumptions as at the time of publishing this document,
investors are cautioned that these statements are not guarantees of
its future performance. Actual results may differ materially from
the forward-looking statements as a result of a number of known and
unknown risks, uncertainties and other factors, many of which are
difficult to predict and are generally beyond the control of
Saint-Gobain, including but not limited to the risks described in
Saint-Gobain's registration document available on its website
(www.saint-gobain.com). Accordingly, readers of this document are
cautioned against relying on these forward-looking statements.
These forward-looking statements are made as of the date of this
document. Saint-Gobain disclaims any intention or obligation to
complete, update or revise these forward-looking statements,
whether as a result of new information, future events or
otherwise.
This press release does not constitute any offer of purchase or
exchange, nor any solicitation of an offer to sell or exchange
securities of Saint-Gobain.
For any further information, please visit
www.saint-gobain.com.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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