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Holcim to unveil higher profit targets as growth accelerates - CEO

Reuters
Reuters
 2021-07-30

ZURICH, July 30 (Reuters) - Holcim will unveil more ambitious targets for profitability and capital returns later this year or early next year, Chief Executive Jan Jenisch told Reuters, after the Swiss company achieved its 2022 targets early.

The world’s largest cement maker raised its 2021 outlook on Friday after reporting higher profit and sales during the first half of the year.

The performance, helped by a resumption of post-pandemic building activity, will continue in the second half of 2021 and into 2022 as government stimulus packages come into effect, Jenisch said in an interview.

“The stimulus will start in the second half of this year..but the real impact will come next year,” Jenisch said.

“The stimulus packages are so big...it’s not just 2022 that they will keep us busy, but for years to come.”

Cement volumes had rebounded to pre-crisis levels, he said.

Holcim had previously aimed to increase annual sales by 3-5%, raise recurring operating profit by at least 7% and achieve a return on invested capital of more than 8%.

“We have to set new targets,” Jenisch said. “We will probably communicate something later this year or the beginning of next year.

“Our performance targets will increase,” he added. “I guess we are going to see more ambitious targets on returns, on margins.”

The company was already seeing good growth from its Firestone Building Products acquisition it made this year, with the U.S. roofing business increasing sales by 21% in the second quarter.

“It will be a $2 billion business right from the start,” Jenisch said. “We want to double Firestone in the next five years.” (Reporting by John Revill; Editing by Michael Shields)

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