Holcim , the world’s second biggest cement maker, is set to report higher first half sales and earnings on Thursday as recent acquisitions and price increases more than offset higher energy costs.
Holcim has benefited from a pick-up in demand for its cement and concrete in North America and parts of Europe as building activity increases on the back of a global economic recovery. Meanwhile higher oil prices boosted the cement company’s energy and transport costs. Management has said energy costs would be around 10 percent of the firm’s full-year net sales.
But analysts expect higher selling prices for cement to more than offset higher costs in the first six months of the year.
"In almost all regions, prices have been increased substantially to reflect higher raw material prices," Bank Leu analyst Patrick Appenzeller said in a note.
Holcim will consolidate its acquisition of Britain’s Aggregate Industries for the first time, which will boost the company’s second-quarter sales figure. Sarasin forecasts a sales contribution from Aggregate Industries of SwFr948m.
Nine analysts polled by Reuters on average expect Holcim to report first half sales of SwFr7.56bn ($5.98bn), up from last year’s SwFr6.32bn, and net income after minorities of SwFR574m compared with SwFr370m.
Holcim is expected to confirm it expects 2005 growth in internal operating EBITDA (earnings before interest, tax, depreciation and amortisation) to exceed a longer-term average of 5 percent.