The Pro Forma Financial Information for the year ended December 31, 2015 reflects the merger of Holcim and Lafarge as if the Merger had occurred on January 1, 2015.
It reflects a hypothetical situation and is presented exclusively for illustrative purposes, as such it does not provide an indication of the results of operating activities that would have been obtained for the period ended on December 31, 2015.
Europe continues to wait for profound recovery
Performance in Europe was influenced by the ongoing strong development of markets such as the United Kingdom and Romania while uncertainty and depressed construction markets affected several other countries. The ongoing softness in France and slowdown in Switzerland, Russia, and Azerbaijan significantly impacted results. Except for ready-mix concrete, volumes were down and net sales and operating EBITDA also declined. Negative currency effects, particularly in Russia and Azerbaijan, and one-time restructuring costs impacted the region’s results significantly.
Economic and construction industry development
Major Eurozone economies continued to experience moderate recovery throughout 2015, but development remained soft in a variety of other countries.
The economy in the United Kingdom continued to expand above the EU average, underpinned by the election of a majority government driving a wave of ambitious national infrastructure projects. Infrastructure investments and residential construction over the course of the year were steady. Public-private investments were encouraged throughout the year to address the country’s housing shortage.
France’s economy experienced a moderate recovery in 2015. However, the construction market deteriorated further as the number of housing starts declined and investment by the government continued to be low. In Belgium, high levels of public debt, inflation, and low growth resulted in limited public infrastructure investment during the year under review.
The German economy reported moderate growth in 2015 that was stimulated by a rise in consumer spending, a favorable labor market and low interest rates. The building sector weakened somewhat over the course of the year. Residential construction remained stable, with a slight increase in non-residential investment. In Switzerland, the economy was impacted by the appreciation of the Swiss franc, resulting in significantly lower growth levels. Construction activity declined compared with the previous year, largely in connection with the completion of large infrastructure projects.
Italy saw growth gradually resume in 2015 thanks to a range of fiscal reforms. The construction industry continued to paint a mixed picture in the year under review. Spain’s economy saw a steady recovery throughout the year reviewed. Activity in the construction industry was driven by private initiatives, as public investments remained weak. Greece’s tentative economic recovery stalled in 2015 owing to the negative impact of political instability on business and consumer confidence.
In Romania the government initiated a comprehensive infrastructure overhaul, the effects of which are to be felt going forward. Nevertheless, residential and infrastructure construction increased in the year under review. The Polish economy continued to grow in 2015. Russia felt the repercussions of Western sanctions, with depressed oil prices sending the economy into recession. The state continued to push major national infrastructure projects in preparation for the 2018 Soccer World Cup games, somewhat offsetting the postponement of other major public works. Falling oil prices resulted in Azerbaijan’s economy stagnating in the year reviewed. Fiscal measures taken by the government included the depreciation of the national currency and cuts to infrastructure and construction projects.