Holcim Ltd - Strong organic growth and record results<br>Proposal for substantial dividend increase<br>Sustainable development leadership widely recognized

2007 consolidated financial statements
Holcim had another record year in 2007. Although economic conditions became more challenging in the second half of the year, the Group’s fundamental strengths were in full evidence. This is demonstrated by strong internal operating EBITDA growth of 10.8 percent and a marked improvement in net income.

Proposed dividend
Based on the good results, the Board of Directors will be proposing to the annual general meeting on May 7, 2008, that the gross dividend be increased from CHF 2.00 to CHF 3.30 per registered share. Therewith, the goal of a payout ratio of one third of net income attributable to equity holders of Holcim Ltd set in 2003 is achieved.

Sales trend and financial results
Cement deliveries increased to 149.6 million tonnes (2006: 140.7). Growth in this segment is primarily attributable to the predominantly good state of the construction markets and in particular the first-time full-year consolidation of the Indian Group companies. Sales of aggregates – at 187.9 million tonnes (2006: 187.6) – equaled the high level seen in the previous year despite the volume decline in the US and the deconsolidation of Holcim South Africa. Europe saw a strong increase, driven primarily by Aggregate Industries UK. Sales volumes of ready-mix concrete were higher in Europe, North America and, in particular, Asia. The Group as a whole reported an increase to 45.2 million cubic meters (2006: 44.2). Deliveries of asphalt declined to 14.8 million tonnes (2006: 15.3).

Operating EBITDA reached CHF 6.930 billion (2006: 6.086) on net sales of CHF 27.052 billion (2006: 23.969). The operating EBITDA margin rose to 25.6 percent (2006: 25.4). Consolidated operating profit increased to CHF 5.024 billion (2006: 4.385). Cash flow from operating activities also reached a significantly higher level at CHF 5.323 billion (2006: 4.423). Net income increased by 67.2 percent to CHF 4.545 billion, including the capital gain and special dividend totaling CHF 1.260 billion from the sale of a stake in South Africa. Net income (attributable to equity holders of Holcim Ltd) improved by 83.7 percent to CHF 3.865 billion (2006: 2.104).

Regional influences
In Europe, almost all Group companies improved their financial results. The key factors were higher operating efficiency, overall stable sales development and the predominantly positive price environment. Worthy of particular mention are the good results achieved by Holcim France Benelux and Aggregate Industries UK. Due to rising cement prices and increasing export volumes, Holcim Germany was also able to increase its operating performance. The Group companies in eastern and southeastern Europe posted substantially better results, led by Holcim Romania and Holcim Bulgaria. In Russia and Azerbaijan, the Group companies achieved a remarkable increase in operating profit. Operating EBITDA rose by 22 percent to CHF 2.399 billion in Group region Europe, while internal operating EBITDA growth was 11.5 percent.

In North America, Holcim US succeeded in greatly limiting the impact of a decline in demand and a rise in energy costs due to productivity gains, high plant capacity utilization and good market prices. St. Lawrence Cement, too, almost matched its good previous-year’s results, benefiting from better terms of sale and from an increase in high-margin construction services. However, its financial performance was affected by one-off restructuring costs in connection with the reorganization of cross-border marketing between the Canadian Group company and Holcim US. Aggregate Industries US reported weaker results, but good prices, cost-cutting programs and temporary plant closures meant that the decline in operating EBITDA was considerably less than the reduction in volumes. In Group region North America, consolidated operating EBITDA declined by only 3.3 percent to CHF 999 million despite the weak US dollar. Internal operating EBITDA growth was slightly negative at -1.9 percent.

In Latin America, robust domestic demand was mainly responsible for the overall successful economic development. At Holcim Apasco, a sharp rise in electricity and energy costs was partially offset by an increase in the use of alternative fuels. The company achieved better ready-mix concrete prices. Holcim Costa Rica as well as the companies in Central America and the Caribbean posted higher revenues. In Colombia, the strong increase in sales across all segments led to a substantial rise in operating results and Holcim Ecuador’s contribution to results exceeded the previous year’s record. Performance of Holcim Brazil was supported by higher delivery volumes and again better prices in the second half of the year. Despite extensive operational cost-cutting measures, Minetti’s operating result was affected by a further sharp rise in raw material and energy prices. Cemento Polpaico posted a good financial result, but failed to match the previous year’s excellent level. The operating EBITDA of Group region Latin America rose by 1 percent to CHF 1.256 billion. Internal operating EBITDA growth reached 4.7 percent.

In Africa and the Middle East, all Group companies achieved better financial results. Due to rising sales prices and larger delivery volumes, Egyptian Cement markedly improved its financial performance. Holcim Morocco also recorded a significantly higher result as did Holcim Lebanon. The results of the West African group of countries were substantially better than the previous year, as were those of Holcim Outre-Mer. Due to the deconsolidation of Holcim South Africa, the operating EBITDA of Group region Africa Middle East declined by 5.6 percent to CHF 653 million compared with the previous year. Like-for-like, the Group reported a remarkable internal operating EBITDA growth of 25.1 percent. This confirms the robust state of the market and the good market positioning of the Group companies.

In Asia Pacific, Holcim achieved remarkably better results, with virtually all Group companies showing an improved performance. The marked rise in operating results is mainly attributable to the first-time full-year consolidation of the two Indian Group companies. Holcim Philippines and Holcim Indonesia substantially increased their contributions to the regional result. Both Group companies benefited from rising domestic demand and a solid price environment. Impressive improvements in results were achieved by Holcim Vietnam. Higher export revenues and efficiency gains only partially enabled Siam City Cement to compensate for lower domestic sales and higher production costs. In New Zealand, good market conditions led to an improvement in operating results and Cement Australia once again exceeded the previous year’s good performance. Consolidated operating EBITDA increased by 35 percent to CHF 1.844 billion, while internal operating EBITDA growth was 16.5 percent.

Investment activity
In 2007, Holcim spent CHF 2.277 billion net (2006: 2.054) on financial investments, mainly in connection with the minority buyout of St. Lawrence Cement in Canada and the strengthening of the shareholdings in the two Indian Group companies. This net amount includes the sale of a stake in South Africa. Investments in production and other fixed assets of CHF 2.245 billion net (2006: 1.265) included major expansion projects in the US, India, Romania, Bulgaria and Morocco. During the year under review, the Group commissioned 6.7 million tonnes of additional cement capacity. Holcim also strengthened the aggregates business and gained greater proximity to customers through further investment in ready-mix concrete, particularly in Europe and the US. Investments in property, plant and equipment to maintain productive capacity and to secure competitiveness amounted to CHF 1.043 billion (2006: 1.062).

Product strategy proves of value
The consistent implementation of targeted marketing strategy for mature and developing countries has proved its worth. Today, some 75 percent of the production capacity is located in emerging markets. In order to keep pace with the predicted high growth in these markets, the Group is currently investing in extensive programs to expand capacity by 28.9 million tonnes by 2011. This figure includes only approved projects or installations under construction. Holcim expects an additional EBITDA contribution of around CHF 1.1 billion a year as of 2012 as a result of these expansions.

Concrete as a building material of the future
In terms of volume, usage of the end product concrete in the world today is greater than any other commodity apart from water. Concrete is therefore of huge importance to economic development. Given its long life cycle, concrete is one of the most eco-friendly building materials. Sustainable urban development and the creation and expansion of modern infrastructure would not be possible without it. There is huge pent-up demand in the growth markets of Asia, Latin America and eastern Europe. Together with the Holcim Foundation for Sustainable Construction, Holcim supports research and development into innovative sustainable solutions in the construction industry. This is all the more urgent because the built environment accounts for some 40 percent of energy consumption in the world today. Holcim also underscores its commitment to the environment with intensive research into new technologies for the production process and environmentally friendly products. The Group is already making a significant contribution to limiting CO2 emissions and is on course to hit its target of voluntarily reducing specific CO2 emissions by 20 percent per tonne of cement between 1990 and 2010.

Sustainable Development
For the third year in a row, the Dow Jones Sustainability Index has recognized Holcim as "Leader of the Industry". This provides independent confirmation that Holcim is committed to sustainability and social responsibility. Group companies have also won numerous awards, while the Sustainable Asset Management Group (SAM), in cooperation with PricewaterhouseCoopers, presented Holcim with the "Sector Leader" prize and a "Gold Class" distinction at the World Economic Forum 2008 in Davos.

Post-balance sheet events
As from January 23, 2008, Egyptian Cement has been included in the consolidated accounts by the equity method due to a change in ownership. Since Holcim's interest of 43.7 percent remains unchanged, the above transaction will have no impact on consolidated net income.

Outlook for 2008
It is not easy to judge how far the turbulence in the financial markets will affect the real economy. However, the Board of Directors and the Executive Committee expect the emerging markets, where three quarters of the cement production capacity is located, to continue to grow. As a globally active company, Holcim remains confident. It enjoys excellent geographical diversification, offers innovative products and services, has expert teams, efficient plants and excellent market positioning. In 2008, the Group is expecting to again reach its long-term growth target of 5 percent in internal operating EBITDA.

Key figures 2007

* * * * * * *
Holcim is one of the world's leading suppliers of cement and aggregates (crushed stone, gravel and sand) as well as further activities such as ready-mix concrete and asphalt including services. The Group holds majority and minority interests in more than 70 countries on all continents.
* * * * * * *
This media release is also available in German.
* * * * * * *
Corporate Communications: phone +41 58 858 87 10
Investor Relations: phone +41 58 858 87 87
* * * * * * *
A preprint of the 2007 Annual Report is available at http://www.holcim.com/reports.
* * * * * * *
Press conference:
Wednesday, February 27, 2008, 9:30 a.m., Holcim, Hagenholzstrasse 85, CH-8050 Zurich