Holcim, the world’s second largest cement producer, has reported a first-half net profit of SFr273 million ($192.38 million), down 6.5 per cent on the comparable period last year.This content was published on August 28, 2003 - 11:31
In a statement from Zurich, the company said that sales had fallen by 9.9 per cent to SFr5.80 billion, mainly due to negative exchange rate movements.
Holcim, formerly Holderbank, pointed out that the US dollar alone had devalued by 17.2 per cent compared with the corresponding period last year.
However, it said that productivity gains and cost savings within the group had a positive impact on earnings.
Commenting on business conditions, Holcim said it had been challenged by both the overall instability of the global economy and subdued investment activity in many markets.
Lacklustre US market
In the United States in particular, the construction order books remained “lacklustre”, while economic conditions in Europe and parts of Asia were also stagnant.
The company said that its operating profit margin had continued to increase. This, it reported, confirmed that restructuring measures and rationalisation measures taken in previous years had strengthened the industrial base and that programmes to cut operating costs were “feeding through”.
Holcim said that it was difficult to predict business conditions in the second half of the year because of uncertainty over the US economy and exchange rate developments.
But it added it was confident of a continued positive margin trend and repeated that it expected this year’s financial result to beat that of 2002.
Last year, Holcim posted a net profit of SFr506 million.
swissinfo with agencies
Holcim is the number two global player in the cement business behind Lafarge of France.
The company’s biggest shareholder is Swiss industrialist Thomas Schmidheiny.
Holcim made a net profit of SFr273 million in the first half of this year, down 6.5 per cent on last year.
The company said it was particularly hit by negative exchange rates.
But it expects to improve its financial result from the SFr506 million it posted last year.
In compliance with the JTI standards