Lafarge reduces 2010 demand forecasts
Lafarge said second-quarter profit fell 15 per cent and pledged to extend costs cuts and asset sales to reduce its debt as it reduced its forecast for demand in 2010.
Net income fell to EUR329m from EUR387m a year earlier, the Paris-based company said in a statement today.
“Based on second quarter activity, we have lowered our full-year volume estimates for western and eastern Europe and increased our volume estimates for North America,” Lafarge said in the statement.
The company said it expects cement volumes in its markets to increase three per cent at best, less than a previous forecast for an increase of as much as five per cent. In the worst case, they may fall by one per cent instead of being unchanged, Lafarge said.
Lafarge Chief Executive Officer Bruno Lafont will seek to cut costs by more than his previous goal of EUR200m in 2010, and said he will invest no more than EUR1bn in 2011 as Europe’s most indebted cement maker tries to keep its investment-grade credit rating. He aims to beat a previous goal of as much as EUR500m of asset sales this year.
The company’s net debt fell to EUR15.16bn on June 30, down one per cent from EUR15.39bn a year earlier. Foreign exchange translation inflated Lafarge’s debt by EUR1bn compared to year end, the company said.
Published under Cement News
