Saint Gobain has reported stable like-for-like sales over the first nine months of 2023, compared to the same period a year earlier, despite a 3.1 per cent YoY contraction in the 3Q23. On a reported basis, sales were down 4.9 per cent to EUR36.5bn (US$38.6bn) in the 9M23 and fell by 10.5 per cent to EUR11.6bn in the 3Q23. Prices over the nine-month period advanced by five per cent YoY and by 1.9 per cent in the 3Q23, reflecting overall sequential price stability and generating a positive price-cost spread, according to the company.
Saint-Gobain credits recent acquisitions and investments for the company successfully repositioning itself in the North America, Asia and emerging countries, and construction chemicals markets, which collectively now account for two-thirds of the company’s operating income. Construction chemicals posted organic growth of 3.1 per cent over the 9M23. In terms of acquisitions, recent deals were mainly in the construction chemicals sector (GCP Applied Technologies, Impac in Mexico, Matchem in Brazil, and Best Crete in Malaysia), exterior products in Canada (Kaycan and Building Products of Canada), and insulation (UP Twiga in India).
Northern Europe saw a limited decline in sales thanks to improved resilience in renovation. Sales in the region dipped five per cent in the 9M23 and by 7.6 per cent in the 3Q23. While the region saw a continued slowdown in new construction, renovation, which accounts for 55 per cent of sales, rallied well. The world’s first carbon-neutral (Scope 1 and 2) plasterboard production at the group’s Fredrikstad plant in Norway enabled St-Gobain to further differentiate its offering.
The southern Europe-Middle East and Africa region saw a slight one per cent rise in sales in the 9M23 and a fall of 2.7 per cent in the 3Q23. Again, this was supported by resilience in the renovation market, which represents almost 70 per cent of sales in the region. According to the company, it continued to outperform its market in France thanks to its strong exposure to the renovation sector, which is being supported by a favourable regulatory environment. The Middle East and Africa markets posted strong growth, especially in Egypt and Turkey.
In the Americas, slight sales growth was driven by the North American market, which advanced by five per cent over the 9M23 and by four per cent in the 3Q23. The price effect gradually lessened due to the high comparison basis but rose sequential due to the price increase in the roofing business over the summer. Latin America was down 5.5 per cent over the 9M23 and by 10.7 per cent in the third quarter. Brazil continues to weigh on sales in a difficult macroeconomic environment, while the Mexican market has benefited from the successful integration of Impac in construction chemicals.
The Asia-Pacific region reported organic growth of 5.1 per cent in the 9M23 and three per cent growth in the third quarter. This was driven by good momentum in volumes and a high comparison basis for prices. India posted another strong performance and captured market share on the back of its global solutions-based approach, the successful integration of recent acquisitions, and the start-up of new capacity. Despite a more difficult market, China enjoyed further good growth momentum due to market share gains in light construction and renovation.
The company’s 2023 outlook is for “another successful year for Saint-Gobain, with the continued implementation of its “Grow & Impact’ priorities.” Amid a moderate market slowdown, the company is targeting for full-year 2023 a new record operating margin, double-digit for the third consecutive year.
