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LafargeHolcim Achieves Resilient First-Quarter Results Amid COVID-19

LafargeHolcim had a strong start to the year as its first-quarter performance remained well ahead of last year’s results until mid-March, when the impact of COVID-19 spread beyond China into all business regions, the company reported. Nevertheless, first-quarter results remained resilient with net sales down 3.3% and Recurring EBIT down 2.6% compared to the prior-year period, both on a like-for-like basis.

North America delivered excellent improvement in volume growth across all business segments. The region showed a continuation of strong cement demand trends from 2019, further supported by favorable weather, while aggregate volume improvement of 12% in the quarter was driven by megaprojects along the Mississippi River. The U.S. and Canadian operations both delivered solid industrial performances, with only minor impact from COVID-19 in the quarter.

Europe delivered solid results despite disruptions in key markets, with good market growth in Eastern Europe and resilient performances in Switzerland and Germany. Volumes in France, the UK and Spain were impacted by COVID-19. Recurring EBIT improved on a like-for-like basis as a result of operational efficiencies.

Latin America delivered a resilient performance, led by a solid performance in Mexico. Brazil, Argentina, Ecuador and Colombia were impacted by COVID-19 lockdown measures since mid-March. The Recurring EBIT margin was resilient thanks to effective price and cost management.

Performance of Asia Pacific was impacted by the COVID-19 outbreak, with China significantly impacted in Q1. There was strong profitability improvement in India despite lockdown measures towards the end of March. The market slowdown in Australia continued.

Middle East Africa delivered an over-proportional increase in Recurring EBIT with turnaround initiatives offsetting COVID-19 impact in the region. Nigeria, Algeria and Iraq were solid contributors, while South Africa and Lebanon were impacted by lockdown measures.

Jan Jenisch, CEO, said, “We are confronting an unprecedented health crisis with COVID-19 that is changing how we live and how we work in many ways. Keeping our employees healthy and safe is our number one priority and core value. In early January, when the first signs of the pandemic emerged, we were quick to respond and take all the necessary measures to protect the health of our people while supporting our partners and communities, in full alignment with local authorities across our markets.

"I am very proud of how our people have gone above and beyond to engage in relief work worldwide," he continued. "Building on our long tradition of working closely with our communities, our teams are actively supporting health efforts around the world – from participating in the rapid construction of emergency field hospitals to sanitizing public spaces and disposing of medical waste all the way to providing critical supplies such as personal protective equipment.

"This crisis highlights how essential construction is to keep society running," he continued. "I would like to extend my sincere gratitude to all our people around the world whose swift response to our new reality has been exemplary. It has allowed us to maintain vital business continuity so that we can play our role to address this crisis. I applaud the determination of all our front-line workers who are providing critical materials and services in challenging lockdown circumstances.

"Our first-quarter results show how resilient we are as a business," Jenisch concluded. "With our significantly strengthened balance sheet, we are in a very strong position to weather this storm. We are currently successfully executing our action plan “Health, Cost & Cash” in all countries, setting the company up for the recovery of our markets. I am confident that LafargeHolcim will emerge from this pandemic as an important contributor to economic recovery as building activity gets back to normal.”