Holcim is reporting net sales of CHF$19,933 million in the first nine months, up 1.2% on a local currency basis compared to the prior-year period. Nine-month recurring EBIT grew over-proportionally compared to net sales to a record CHF$3,884 million, with a rise of 11.1% in local currency versus the prior-year period.
Holcim’s recurring EBIT margin continued to increase in the third quarter to a record 23.5%, reaching 19.5% for the first nine months. As a result, Holcim said it is on track to again deliver industry-leading margins for the full year.
Miljan Gutovic, CEO, said, “I thank all members of the Holcim family for delivering record profitability in the third quarter. Across all our markets, our teams advanced our sustainable building solutions from ECOPact and ECOPlanet to Elevate, meeting our customers’ most ambitious needs.
“Our third-quarter results confirm Holcim’s strong earnings profile, with broad-based growth drivers delivering record recurring EBIT and a record margin. Our disciplined M&A execution has continued with six value-accretive acquisitions to expand Solutions & Products, strengthen our footprint in Europe and grow in attractive Latin American markets.
“With our track record of creating superior value across all market conditions and economic cycles, our resilient business model positions us to deliver another year of record results, executing on our strategic priorities,” he concluded.
Investing in profitable growth, Holcim made six value-accretive acquisitions during the quarter, reaching 17 for the year to date.
In the United States, Holcim signed an agreement to acquire OX Engineered Products, a leading U.S. provider of advanced insulation systems that complements its range of building envelope solutions. The acquisition continues the expansion of Holcim’s Solutions & Products business into the most attractive construction segments, from roofing and insulation to repair and refurbishment. The transaction, which is synergistic and EPS accretive from year one, is subject to customary conditions and regulatory clearance in the U.S. and is expected to close in the fourth quarter of this year.
In Latin America, Holcim closed three acquisitions to enter the Peruvian market and strengthen its market position in Guatemala. These transactions provide a platform for further expansion in the high-growth region. In Europe, Holcim grew its footprint with the acquisitions of a ready-mix concrete business in Serbia and an aggregates business in France.
Customer demand for Holcim’s sustainable building solutions increased in the first nine months. Net sales of Holcim’s ECOPact and ECOPlanet accounted for 29% and 25% of their respective segments from 19% in each case in the prior-year period. Holcim accelerated its expansion of its proprietary technology ECOCycle with a 23% increase in the volume of recycled construction demolition materials in the first nine months compared to the prior-year period.
Holcim was awarded a new European Union Innovation Fund grant for the development of carbon capture and storage technology in Martres-Tolosane, France. This brings to seven Holcim’s total number of EU Innovation Fund grants for carbon capture, utilization and storage projects. Holcim has invested in innovative startups to broaden its range of clean construction technologies, from Sublime Systems, with its proprietary electrochemical process, to advanced mineralization startup Paebbl, all the way to 14Trees for 3D printing.
Building on the record performance in the third quarter, Holcim is on track to achieve its full-year guidance for 2024, with:
- Low single-digit net sales growth in local currency.
- Over-proportional growth in recurring EBIT.
- Increase in recurring EBIT margin to above 18.5%.
- Free cash flow of above CHF 3 billion.
- 20% growth in recycled Construction Demolition Materials to 10 million tons.
- Progress towards U.S. listing of North American business.
The intended listing of Holcim’s North American business in the United States is on track to be completed in the first half of 2025, with the aim of unlocking a new era of value creation for all stakeholders.