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.
Latin America with solid growth in most countries but impacted by recession in Brazil
The Group’s performance in Latin America benefited from positive trends in both volume and financial performance in key markets such as Mexico, Argentina, Central America, and Colombia. These however were unable to fully compensate the effects of the deteriorating economic situation in Brazil. Cement volumes were slightly down but net sales increased and adjusted for merger, restructuring and other one-offs operating EBITDA remained stable. The Group continued to focus more strongly on its customer excellence measures in various markets, building on its established retail approach. Strong synergies could be realized in Brazil and through industrial best-practice sharing and ready-mix concrete optimization across the region.
Economic and construction industry development
Latin America continued on a mixed course throughout 2015, with strong growth trends in most markets offsetting a protracted slowdown in Brazil, the continent’s largest economy.
Mexico and Central America experienced growth, largely owing to exposure to the US economy. As growth of the Mexican economy continued, major infrastructure plans became more dynamic. In Costa Rica and El Salvador economic growth was less than in the previous year; however, demand for construction materials remained relatively unaffected. Nicaragua showed the highest growth in the sub-region. Remittances continued to have a positive impact in all these countries.
Ecuador’s economy and construction activity has depreciated in comparison to 2014, primarily as a result of the drop in oil prices. Colombia’s investment in public-private partnerships drove bold nationwide infrastructure projects despite the impact of falling oil prices and the strong peso devaluation on the economy.
Brazil weakened further in the course of 2015, with knock-on effects for some of the country’s key trading partners in the region. As a result, the construction market in Latin America’s biggest economy shrunk significantly in 2015.
Argentina experienced stabilization of economic activity over the course of 2015. Government spending on construction activity saw a steady increase and industrial production growth ceased to decline for the first time in two years. Following the election of the new president in December, the lifting of capital controls led to a strong depreciation of the peso.