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.
LafargeHolcim performance by country
Steady growth in the construction sector in the United Kingdom coupled with greater public investment led to an increased demand for building materials, particularly in the residential sector but also for industrial consumption in London and road projects. As a consequence, aggregates and ready-mix concrete volumes grew. Cement volumes showed a marginal decrease over last year. The Group company’s financial performance was significantly higher in 2015.
As a result of unfavourable economic conditions and a decline in construction activities, volumes in France declined in all three segments. These effects were partly mitigated by resolute cost reduction measures. Financial performance in France was significantly lower as a result of the challenging market conditions coupled with pricing pressures. In addition, financial results were heavily impacted by restructuring costs. In Belgium, declining cement volumes were largely attributable to the discontinuation of cement exports to France but the depressed construction markets also contributed to this result. Financial performance was lower than in the previous year, impacted by restructuring costs.
A slight stall in construction activity in Germany resulted in decreased demand for cement. Cement volumes decreased slightly at the Group’s northern Germany operations. Aggregates volumes reported steady growth in the year under review, mainly attributable to the transfer of some operations to the local Group company. Cement volumes in Southern Germany improved throughout the year. Operating EBITDA decreased at both Group companies.
Results in Switzerland were impacted by a general decline of construction markets in the course of 2015. Cement volumes significantly declined due to high import pressures following the abandonment of the Swiss franc-euro peg and other factors. Aggregates volumes also dropped, impacted by the completion of some major projects. Despite the more positive macro-economic environment, Italy’s construction sector remained challenging. As a result, all three segments experienced volume drops. Poor financial performance reflected the weakened Italian construction market, with operational restructuring and cost reductions dampening performance somewhat.
In Spain, volumes in all three segments were down, partly as a result of lower exports, plant closures, and the completion of several large projects. Financial performance in Spain decreased in 2015 due to one-time costs, despite effective cost management. In Greece, demand for building materials continued to be adversely impacted by political and economic instability, with both residential and infrastructure construction remaining at low levels. As a result, both cement and ready-mix concrete deliveries declined in 2015. However, aggregates volumes were up. Cost containment measures and favorable export price development impacted the Group company’s financial performance positively, leading to a higher operating EBITDA in 2015.
Eastern Europe showed mixed results in the year under review. Romania saw considerable increases across all three segments, with aggregates and ready-mix reporting very strong volume growth. Operating EBITDA rose markedly, reflecting lower operating costs and increased activity in important regions such as Bucharest. Overcapacity, competitive pressure, and a slow recovery in the residential market in Poland resulted in volume declines in cement and aggregates. Ready-mix volumes rose, while financial performance declined in comparison with the previous year.
The emerging economic recession in Russia led to a decline in public investment, and as a result demand for building materials declined across the Group company’s presence. Cement volumes were down due to this challenging environment. Despite network optimization and cost containment measures, financial performance of the Group company decreased slightly – also impacted by one-off costs. A significant decline in public and private construction spending led to lower cement volumes in Azerbaijan. Financial performance declined and measures were implemented to reduce fixed costs.