Lafarge 1Q sales down on poor weather
Lafarge reported a 10 per cent drop in first-quarter sales on Wednesday as tepid economic growth and a harsh winter slowed construction work, sending its shares down.
But the group kept its outlook unchanged for 2010, forecasting a rise of up to five per cent in global cement demand in its markets, and said it expected demand to start to recover in developed countries in the second half of the year.
"The first quarter is traditionally a small one for Lafarge, this one was even smaller but is not significant for the rest of the year," Chief Executive Bruno Lafont told a conference call.
"Over the last two years, we have lost more than EURbn in sales, which corresponds to the slowdown in construction in developed countries. These EUR3bn now represent a potential for rebound," he added.
Sales for the quarter to March 31 were down to EUR3.28bn.
The operating result was down 30 per cent to EUR236m, hit by unfavourable weather conditions and the still sluggish construction sector in recession-hit developed countries.
"Very poor weather and the lower economic activity in developed countries and Eastern Europe negatively impacted volumes and margins," Lafarge said in a statement.
But the cement maker swung back to a net profit of EUR64m, after a net loss of EUR17m a year ago, helped by a one-off capital gain of EUR137m on the disposal of its investment interest in Cimpor. Published under Cement News
