Lafarge sales growth set to slow in Q3

Lafarge sales growth set to slow in Q3
Published: 18 October 2004

Lafarge SA is expected to report Thursday a slowdown in sales growth for the third quarter after weather-related strength in the first half, but will likely reiterate its full-year outlook for operating profit growth, analysts said.

Forecasts for nine months sales range between EUR10.82-10.880bn, implying third quarter sales just above EUR4bn. Growth for the whole period would therefore be above 5 pct, whereas the rise for the latest three months would be below 4 per cent, analysts said.

The company has a forecast for 10 per cent like-for-like growth in operating profit for the full year, and analysts expect that to remain unchanged. Even though the consensus for 2004 operating growth is about 13 pct, according to Deutsche Bank, analysts reckon high oil prices will dissuade management from tweaking their own estimate.

Analysts at Aurel Leven predict an improving price environment in the Philippines and Germany will help the cement business, which makes up some 47 per cent of sales. They also note though that sustained weakness in the commercial construction market in the UK is likely to impact Blue Circle.