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.
Positive volume and net sales trends in Middle East Africa
Middle East Africa showed mixed growth as countries such as Kenya and Algeria performed strongly while some of the region’s markets were impacted by lower demand as a result of lower oil and commodity prices. Overall, cement and aggregates volumes in the Group region were up in 2015. Net sales also increased, but operating EBITDA declined in the year under review. The region was significantly impacted by negative currency effects and high inflation.
Economic and construction industry development
Middle East Africa was characterized by a mixed economic development in 2015 as oil-exporting countries struggled to offset historically low oil prices, while importing nations benefited from that situation. This was coupled with economic reforms and improved trade conditions with the Eurozone.
Egypt’s economy began the year under review with strong tailwind, and economic reforms introduced by the current government spurred confidence. The government’s emphasis on large-scale public and private projects triggered increases in infrastructure activity. Steady population growth has further pushed the demand for residential and commercial construction projects. Meanwhile, the Algerian economy’s reliance on oil-related deposits resulted in exchange rate depreciation and slow growth in the year reviewed. The construction sector continued to flourish, underpinned by the government’s push for transport infrastructure and public housing, guided by an ambitious five-year-plan. Morocco experienced steady economic growth as inflation levels remained low. The country’s construction industry slightly improved its trajectory, driven by demand for housing and increased public spending.
Political instability and the situation in neighboring Syria impacted economic growth in Lebanon in the year under review. The construction industry saw a slowdown reflecting weaker demand and a cautious mood in the property market. Jordan’s economic situation was also impacted by the regional situation. As the political situation remained fragile in Iraq, construction activity continued to be impacted by the volatile security situation in parts of the country.
Temporary macro-economic challenges including volatile exchange rates, lower oil prices, and insurgencies in the northeast of the country slowed Nigeria’s growth rate in the year reviewed. The country’s construction industry developed positively thanks to increasing urbanization. Kenya continued to grow throughout 2015. Increased public expenditure on road and housing projects drove demand for cement. Declining copper prices and foreign exchange fluctuations weakened Zambia’s economic growth throughout the year reviewed. The government made commitments to reform legal constraints in the construction sector, but these have been slow to materialize. In South Africa the government remained committed to infrastructure investment; however, slowed economic performance adversely affected the country’s construction industry in 2015.