A strong rise in Lafarge earnings in 2000

1 March 2001

Operating income: + 17 %
Net earnings: + 18 %

The Board of Directors of Lafarge met on Wednesday, February 28, 2001, under the chairmanship of Bertrand Collomb, to close the year 2000 accounts.

Sales are up by 16% to €12,216 million:

  • Excellent sales in Europe except for Germany;
  • Favorable pricing, particularly in Brazil, Philippines, Italy and Poland;
  • Integration of new acquisitions.

Operating income rises to €1,905 million, an increase of 17% coming mainly from:

  • Increased contribution from emerging countries, particularly in Asia;
  • Efficient control of energy costs;

Net earnings Group share totaled €726 million, a rise of 18%. Net earnings per share were up 10% at €6.8. In 2000, the Group adopted the full deferred tax provision accounting method. After restatement of the 1999 results, the increase in earnings per share is equivalent to 25%. At the Annual General Meeting of Shareholders on May 28, an increase in dividend from € 2,05 per share to €2,20 (to which the French tax credit should be added) will be proposed. The shares resulting from the January 2001 rights issue are eligible to this dividend. Shareholders will have the right to take their dividend either in cash or in shares.


Cement Division
(Current operating income : €1167 million, up 29%)

Income in Western Europe and North America grew by 9% overall, in spite of the economic slowdown in North America in the second half and the weakness of the German construction market. Income earned in emerging markets rose significantly and now represents 39% of the Division's results compared to 29% in 1999. Excellent income growths were achieved in Poland, Brazil and Venezuela and a favorable turn-around in Rumania and the Philippines. This progress confirms the success of the development strategy of Lafarge in emerging countries.

The new acquisitions in South Korea (Halla Cement) and in India (Tisco) contributed together more than €30 million of additional profits. A share of around 10% in the Portuguese Cement Company Cimpor was acquired during the year.

Aggregates & Concrete Division
(Current operating income : €309 million, up 24%)

The Division enjoyed a very good year in France, thanks to full Redland synergies and the success of the performance improvement program.

In North America, Lafarge carried out several acquisitions in aggregates and asphalt, offering strong synergies with existing operations.

Roofing Division
(Current operating income : €219 million, down 6%)

The persisting weakness of the construction market in Germany resulted in a decrease of the German earnings. Restructuring measures have already been announced to react to this situation.

Profits of other European countries as well as profits from emerging countries and the USA progressed strongly.

The development of business continued with the acquisition of a leadership position in clay tiles in Germany and the opening of new tile plants in several countries.

Gypsum Division
(Current operating income : €60 million, down 53%)

After a record 1999, 2000 was a difficult year. In Western Europe, it was possible to offset the increase in energy costs and raw materials by price increases only in the latter part of the year.

Most of the decrease in the operating income can be attributed to the North American situation with a rapid fall in wallboard prices, energy and raw material costs increases as well as one off start up costs for the two new wallboard plants in Kentucky and Florida .

Income from emerging markets was up significantly.

Recent price increases in Europe combined with expected performance improvement, low production costs of the new US plants and synergies from new developments should generate a significant improvement of the Division's performance in 2001.

Specialty Products Division
(Current operating income : €150 million, up 23%)

The Division continued to improve its margins in generally favorable markets. Most Division assets were sold at the end of 2000 to a newly created company called Materis in which Lafarge retained a 34.69% stake.


For 2001, trends are expected to be positive with market growth in Europe, except for Germany, a more or less stable outlook in the USA and significant growth in emerging countries. Price trends are overall favorable.

Bertrand Collomb, Chairman and CEO of Lafarge, commented: "2000 proved to be again a very successful year for Lafarge with continued growth in earnings. The strength of the Group and its worldwide presence allowed Lafarge to overcome unplanned increases in energy prices as well as fluctuations in some markets like Germany and the USA".

"The acquisition of Blue Circle Industries PLC will be in 2001 a major step in Lafarge's development which will confirm its worldwide leadership in cement and building materials."

Key figures as of 31 December 2000
  2000 € million 1999 € million %
Gross operating income (EBITDA) 2,592 2,222 + 17
Operating income on ordinary activities 1,905 1,630 +17
Net earnings Group share 726 614 +18
Key figures on shares as of 31 December 2000
  2000 € 1999 € %
Net earnings per share 6.78 6.19 +10 *
Net dividend per share 2.20 2.05 +7

(*) Up 25% after reprocessing of 1999 results, with deferred tax global accounting method.

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