Lafarge posts strong FY profit

Lafarge posts strong FY profit
Published: 23 February 2007

Lafarge reported a jump in full-year profits, within the range of analyst forecasts, citing positive market trends and the impact of restructuring, and said it expects to exceed its own targets for earnings per share and return on capital employed (ROCE) through 2008. 
The company posted full-year net profit of EUR1.372bn, up 25 per cent from the 2005 reported figure of EUR1.096bn, while earnings per share reached EUR7.86 , a 23 per cent rise on the previous year. 
Operating profit, excluding Lafarge’s roofing unit which is being divested, reached EUR2.772bn, up 23 per cent from EUR2.246bn, a restated 2005 figure that also excludes the roofing unit. 
Earlier this month, Lafarge reported full-year sales of EUR16.9bn up 17 per cent from a restated 2005 figure of EUR14.5bn, including organic growth of 14 per cent. 
’We saw a strong increase in our results, with positive trends in our markets, strong organic growth and tighter cost control,’ CEO Bruno Lafont said in a press release this morning. 
The group said it will propose a dividend of EUR3.00/share, up 18 per cent on 2005, and also plans a EUR500m share buyback in 2007. 
’2006 was a year of transformation for Lafarge,’ according to Bruno Lafont, in view of the sale of the roofing unit, the buy-out of minority shareholders in Lafarge North America, and the launch of the Excellence 2008 programme, which aims to cut costs by EUR340m by 2008. 
In the fourth quarter, ’favourable pricing and volume trends continued,’ according to the company, although net profit fell 15 per cent because of a higher tax rate compared to the year-earlier period.