LafargeHolcim performance by country

Cement volumes in India declined as adverse weather conditions and partially depressed construction markets impacted LafargeHolcim’s performance in 2015. Volumes in the fourth quarter however increased at both ACC and Ambuja, LafargeHolcim’s Group companies in India. Ready-mix volumes at ACC saw strong growth in the period under review. While ACC improved financial performance in part thanks to positive pricing particularly in the South, Ambuja’s operating EBITDA declined. The Group’s robust position in India and political appetite for large-scale infrastructure products promise opportunities as conditions improve.

The Group Company in Sri Lanka reported a significant increase in cement volumes, boosted by strong demand in retail in 2015 and accelerating growth in the infrastructure and tourism projects in the last quarter. 2015 has been a difficult year for Bangladesh’s cement industry, and cement volumes were down at LafargeHolcim, but the fourth quarter volume performance showed signs of improvement. Efficient cost management limited the impact of gas price increases by the government.

In China, cement volumes were down compared with the same period last year, despite slightly improved activity later in the year. This was attributable to a contraction in real estate investments and tight liquidity. Although a new aggregates project and lower production costs in the country proved successful, the overall challenging situation negatively impacted operating EBITDA. In this context, the Group took decisive actions during the second half of the year to reduce its costs base.

Cement volumes in South Korea were higher than in 2014 in a market that was characterized by growing housing starts and increased investment in infrastructure. A significantly increased operating EBITDA reflected the Group company’s strong financial performance in the period under review.

Cement and ready-mix concrete volumes increased significantly in Vietnam in 2015, mirroring the country’s largest construction boom since 2011. LafargeHolcim’s involvement in key infrastructure projects in Ho Chi Minh City and Hanoi contributed to a strong increase in operating EBITDA.

Despite the effects of declining commodity prices and currency depreciation, Malaysia recorded solid GDP growth. Domestic cement volumes increased while exports were lower than last year. The Group company reported slightly improved financial performance over the previous year mainly due to stringent cost controls in the cement segment.

In the Philippines, LafargeHolcim continued to benefit from lively private residential construction and public infrastructure investments, with cement volumes up significantly in the year under review. Steady economic growth and policy measures have contributed to the ongoing high demand for building materials. Financial performance was up materially also thanks to positive pricing dynamics.

Full-year cement volumes in Indonesia increased supported by the now fully commissioned Tuban plant in Eastern Java. Significant volume increases were recorded in the fourth quarter. Aggregates deliveries grew slightly as a result of an expansion of third party deliveries, while ready-mix cement volumes fell. The difficult operating environment was characterized by delays in infrastructure projects and subdued residential construction. Combined with the effect of a competitive environment, it resulted in a lower financial performance compared to 2014.

The cyclical downturn in the mining industry continued to adversely affect performance in Australia in 2015. Aggregates volumes increased slightly despite weakened demand in Western Australia. Ready-mix concrete volumes contracted, as steady demand from New South Wales was not able to compensate for lower deliveries elsewhere. Effective cost management and restructuring initiated in 2015 have had a positive impact on operating EBITDA, which was up significantly despite the challenging market conditions.

In New Zealand, cement volumes declined while strong residential and road construction growth supported higher aggregates volumes. The transition to a cement import model continued to proceed well, albeit with transitional impact on volumes. Operating EBITDA was up materially.