Lafarge ups mid-term targets, mulls roof unit sale
Lafarge raised its mid-term targets on Thursday and said it was considering selling its underperforming roofing business as it seeks to boost profits.
Fleshing out a strategic plan announced in February, the world’s biggest cement company said it expected average annual earnings per share (EPS) growth of 10 per cent by 2008, driven largely by its key cement division. It was previously expecting 8 percent EPS growth.
The group aimed to cut costs by EUR400m (US$505.2m) by 2008 and generate EUR1.5bn in additional cashflow over the next three years helped by a EUR1bn disposal programme by end-2008 and tight control on maintenance investments.
"The divestment of our roofing business is under consideration, on the condition that we can obtain the full valuation of our assets and maintain a minority interest in this activity," the company said.
The unit, which makes concrete and clay tiles, has suffered in recent years largely because of a fall in prices in Germany after its post-reunification building boom ended.
Lafarge aims to turn around the unit so it can generate EBIDTA of EUR350m by 2008, up from EUR222m in 2005.
Published under Cement News
