© 2024 Alpha Spread Limited. All Rights Reserved.
www.alphaspread.com is not operated by a broker, a dealer, or a registered investment adviser. Under no circumstances does any information posted on www.alphaspread.com represent a recommendation to buy or sell a security. The information on this site, and in its related newsletters, is not intended to be, nor does it constitute, investment advice or recommendations. The information on this site is in no way guaranteed for completeness, accuracy or in any other way. In no event shall Alpha Spread Limited be liable to any member, guest or third party for any damages of any kind arising out of the use of any content or other material published or available on www.alphaspread.com, or relating to the use of, or inability to use, www.alphaspread.com or any content, including, without limitation, any investment losses, lost profits, lost opportunity, special, incidental, indirect, consequential or punitive damages. Past performance is a poor indicator of future performance.
You don't have any saved screeners yet
Intrinsic Value is all-important and is the only logical way to evaluate the relative attractiveness of investments and businesses.
Ladies and gentlemen, welcome to the LafargeHolcim Media Conference Call on Q3 2020 results. I'm Andre, the Chorus Call operator. [Operator Instructions] And the conference is being recorded. [Operator Instructions] The conference must not be recorded for publication or broadcast. At this time, it's my pleasure to hand over to Eva Mairinger, Head of Media Relations. Please go ahead, madam.
Thank you, Andre. Good morning, everyone, from our side to LafargeHolcim's Q3 Trading Update Media Call. Let me now hand over the word to our CEO, Jan Jenisch, for some introductory remarks. And afterwards, we're happy to take your questions. Thank you. Jan, please go ahead.
Yes, good morning, everyone, and welcome to our media call for the Q3 results. Obviously, a very exciting news. We are clearly above expectations in all KPIs, and I'm personally very proud how our global team has handled the pandemic and what excellent results we have achieved here in Q3 2020. When you look at the results, you can see that our demand is very, very resilient. We are basically back to last year levels on sales. At the same time, our action plan, health, cost and cash, has delivered results above target and all financial KPIs are ahead of last year, starting with the EBIT, which is up 10%, but also all the other figures are above the last year, and we're very happy to have achieved this. If you look a bit in the -- where the good results are coming from, you will notice that Latin America has been our biggest contributor where sales or cement volumes are up 6%, which in the last 3 months. Also we are, in Asia, 3% above last year. While in Middle East, Africa and Europe, we are close to last year's level. So really very strong results. It shows how resilient the demand is for our products. It's also interesting to see that our branded products, which are sold in distribution channels and in the retail networks are in very high demand. We have, for example, our branded bag cements are up 5% in volumes compared to last year. This is very fantastic to see how well we are positioned here to continue business successfully. I think now going forward, we are, I would say, quite optimistic. We have a very strong balance sheet, the strongest in the industry, ready to -- for any opportunity which might come up. We -- I think our decentralized and empowered business model works excellent in these times. And our footprint, especially in distribution, retail and with the branded products is -- will continue to give us good demand for our products and services. At the same time, we expect in latest next year that all the stimulus programs will kick in. We have plenty of announcements from the governments from China to Australia, from India to the U.S., Latin America and also many European countries, so I'm here -- quite confident going here into the fourth quarter of the year and also into next year. I think with this, I'm sure you have plenty of questions and comments. I'm very happy to pass over to you.
[Operator Instructions] The first question comes from the line of Leonard Kehnscherper from Bloomberg.
You said last week that you decided to acquire a bigger business for your Solutions and Products segment. Is there anything concrete on the horizon yet?
Nothing we can announce. We can just say we are ready. We have looked into a sizeable business last year, which didn't materialize for a few reasons, and we are ready to -- we are ready if the opportunity comes up.
Next question comes from the line of Johannes Ritter from FAZ.
Looking at the elections in the United States next week, from a business point of view, what would you expect from a winner that could be Joe Biden?
Well, I think in any event, I think in the U.S., we will see a strong stimulus programs for next year, which will focus on infrastructure and construction, and I think this is true for both candidates. So whatever -- whoever wins the race for us, I think, will be a very positive market in the U.S. next year.
And what about the taxes? Biden said that he would -- yes, increase taxes once he's in office.
We have to see that. I think it's a very intense race. What we all see and follow at the moment, and the question is later than what program they really will define in details. And also, I think the question is then in the parliamentary houses, how the majority lies. So -- but I'm confident. I think they have -- to the U.S., especially, they have to do everything to support the economy, and this will be good for LafargeHolcim.
When Trump came in office, I remember that you and many of your colleagues were very confident that his announcement also, including infrastructure programs, where -- would give you a push. And did your hope, in fact, materialize if you look back at the past 4 years?
Yes, we have a very good market. You see from our numbers, North America is our -- has been our highest return regions in recent years, so it has been very good for us. In infrastructure, there were programs. They passed the highway bill, executed on it. So we had a good situation, and I think this will now continue.
[Operator Instructions] Next question comes from the line of Oliver Hirt from Reuters.
I wondered U.S. is voting on the concern for next month. So what does this mean if it went through for LafargeHolcim? And if you want to, would you consider moving [indiscernible]?
No, no. I think -- I mean, basically, that's -- I think that, that's one of the initiatives is well-understood. And the initiative itself is a bit, I think, a sensitive one, certainly for companies, but we -- I don't think you should always go black and white with those things. We are looking for the results. And then, of course, we are always respectful, whatever comes out, we will organize us accordingly. But I think there's no point to make any black/white statements at this point.
But you're opposing it, right?
I think -- again, I think the reasons for the campaign is very good. And it's also our policy as a company to be proper in every country we operate. And sometimes, there are challenges which we address then. And I think how the initiative is phrased at the moment, it's not positive. It will not have a positive outcome or a positive contribution to those countries. So that's why I'm not excited about the campaign. But the basis of this is I can fully understand and support.
Do you see legal measures against tolls in Switzerland if this gets approved?
No. No. Again, I think our policy is we want to be a proper company everywhere we operate. If we have issues somewhere, we address it. And so we have nothing to hide. We are fully transparent. You always have to imagine, we are a company of 72,000 employees globally. So basically, 70,000 families are with LafargeHolcim, and they want to work for a business, which is proper, which is clean and not do any tricks or something. This is why I have zero tolerance when it comes to compliance and our operating standards have to be the same everywhere. So this is how we see things.
[Operator Instructions] The next question comes from the line of [indiscernible] Asset Management.
First of all, congratulations for the great result. I have totally other question concerning the Cuba issue. A couple of years ago, we could read in the newspapers an old story where the landlords start to sue for their property. Can you say anything to this issue? Or is it fixed?
Yes. Thank you. So the Cuba topic, it's now a court case, obviously, in Florida at the moment. We believe the claim is groundless as it is. We have not taken land from anyone, and it's a very actually limited case, and we don't believe it has any merits.
The next question is a follow-up question from Leonard Kehnscherper from Bloomberg.
I was also wondering if you expect that LafargeHolcim will be fined for the alleged violation of the U.S. trade embargo on Cuba related to that joint venture? Could you give us a bit more color?
We have not violated any U.S. embargo or any U.S. sanctions. This is a private claim of people who believe they have a claim. So this has nothing to do with U.S. embargo or something that's...
So there's no alleged violation of the U.S. trade embargo on Cuba?
No. No, we never violated that.
There are no more questions at this time.
Good. Any more questions or comments, please?
[Operator Instructions]
Otherwise, again, thank you for joining us on a Friday morning, and very happy. We have some good news in this pandemic and happy writing to all of you, and I look forward to see you very soon on video or maybe even live. Yes. Thank you very much, and have a good Friday.
Ladies and gentlemen, the conference is now over. Thank you for choosing Chorus Call, and thank you for participating in the conference. You may now disconnect your lines. Goodbye.