Moody’s upgrades Holcim outlook

Moody’s Investors Service has upgraded Holcim’s outlook to stable, ending 15 months on a negative watch.

Moody’s said it changed the outlook citing cash generation as cement sales in the US and emerging markets improve, according to reports by Bloomberg. Holcim maintained its investment-grade rating throughout the European financial crisis.

Holcim’s Leadership savings program should gain momentum in 2013 and will help Holcim improve its finances, Moody’s said.

Last year, Holcim’s turnover rose by 3.9 per cent in 2012 to CHF21,544m and in euro terms the increase was 6.4 per cent to EUR17,867m. Better demand in the fast-growing markets of Asia and Latin America as well as North America contrasted with low demand in debt-laden Europe. Operating EBITDA improved 6.2 per cent to EUR3502m before restructuring costs, after which the advance was a mere 0.7 per cent to EUR3304m. The trading profit fell by 6.2 per cent to EUR1506m (though before exceptional items it was ahead by 10.5 per cent) and net profit jumped by 126.5 per cent to EUR516m.

The company had earlier said it expects EBITDA and operating profit to witness a further improvement of margins with the Holcim Leadership Journey contributing to this development. Under similar market conditions, significant organic growth in operating EBITDA and operating profit should be achieved in 2013, according to the company.