Holcim reports net sales of CHF29,289m in 2022
Holcim reported its financial results for 2022 announcing net sales of CHF29,189m (US$31.2m) for 2022. This was a 12.9 per cent rise on a LfL basis compared to the prior year. The increase was driven by the fast expansion of the Solutions & Products division, which grew by 54 per cent compared to the previous year.
Holcim CEO, Jan Jenish, said: "In 2022, we delivered record financial results with CHF 29.2bn in net sales, CHF 4.8bn in recurring EBIT, 9.5 per cnet ROIC and a record leverage ratio of 0.9x. Holcim has never been stronger. This gives us the freedom to invest in our future and further accelerate green growth with continued acquisitions and the ongoing decarbonisation and digitalisation of our operations."
Recurring EBIT reached a record CHF4752m for 2022, up 7.2 per cent on a LfL basis compared to the prior year. Holcim reported that this record result was driven by very strong margins in the roofing business as well as positive price over cost for cement, aggregates and ready-mix combined. Reported net income group share reached CHF3308m, an increase of 44 per cent compared to year-ago period.
Net cement sales totalled CHF16,340m in 2022, down 0.4 per cent from CHF16,399m in 2021 but up 14 per cent on LfL basis. Recurring EBIT of cement reached CHF3301m, down eight per cent from CHF3587m in 2021 (+1 per cent LfL). Net aggregate sales totalled CHF4195m, up 3.9 per cent (+5.2 per cent LfL) from CHF4037m in 2021. Net ready-mix sales totalled CHF5748m, up 11.2 per cent (+12.5 per cent LfL) from CHF5167m in 2021.
Holcim's net financial debt was CHF6032m at the end of 2022, resulting in a record-low leverage ratio of 0.9x. The group's return on invested capital for 2022 was 9.5 per cent, in line with the group's strategy 2025 target of 10 per cent.
Furthermore, the Solutions & Products segment reached 19 per cent of the group’s total net sales, up from eight per cent for 2020, putting the company on track to reach its strategic goal of 30 per cent of net sales from the business unit by 2025.
Holcim added that it continues to advance its leadership in sustainability with the 21 per cent reduction of CO2 per net sales in 2022, with a target to reduce it by over 10 per cent in 2023. Driving circular construction, Holcim recycled 6.8Mt of construction and demolition waste in its products in 2022, on track to reach 10Mt by 2025.
Moody's analysis
Vitali Morgovski, Vice President, Senior Analyst at Moody’s Investors Service, commented on Holcim's resuts: “We [Moodys] believe by 2025 the company will exceed its target of having a 30 per cent revenue contribution from the Solutions & Products segment. We estimate Holcim’s net leverage at around 1.1x at the end of 2022, pro-forma the disposals, which is a strong level for the Baa1 rating category. However, the negative volume development in the second half of 2022 that will mostly likely continue in 2023 along with volatile energy costs present a significant challenge for performance in the coming quarters.”
