LafargeHolcim Q2 profit beats forecasts, new CEO to join early

27 July 2017

LafargeHolcim posted slightly better-than-expected second-quarter results on Wednesday as the world’s biggest cement maker sought to put a scandal over payments to armed groups in Syria behind it.

The Franco-Swiss company reported adjusted operating profit of 1.735-billion Swiss francs ($1.82-billion) for the three months ended June 30, slightly ahead of the average estimate of 1.714-billion Swiss francs in a Reuters poll.

This met its target of generating double-digit like-for-like growth in adjusted operating profit compared with 2016.

The cement maker said Jan Jenisch would start as chief executive on September 1. The former boss of high-flying Swiss construction chemicals maker Sika had been due to take the reins from October 16.

Jenisch’s appointment would not affect the company’s 2017 and 2018 targets, which the company was “well on track” to meeting, Hess said.

The Jona, Switzerland-based company this year parted company with CEO Eric Olsen after it admitted paying armed groups to keep a plant operating in war-torn Syria. Olsen has been cleared of involvement in the affair by an internal investigation.

Second-quarter revenues fell a headline 5.9% but rose 3.6% like-for-like to 6.85-billion francs, when sell-offs of assets like the company’s operations in Vietnam and Chile were taken into account.

The group said the United States, India, Nigeria and Mexico made significant contributions to quarterly earnings, more than offsetting headwinds in some of other markets.

During the quarter, LafargeHolcim said operating profit had improved in three of its five regions, with Asia-Pacificremaining a laggard and Europe also a drag.

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