REG - Compagnie St-Gobain - 1st Quarter Results

Compagnie de Saint Gobain SAAnnouncement

24/04/2025 17:45

For best results when printing this announcement, please click on link below:
https://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20250424:nRSX1253Ga&default-theme=true

RNS Number : 1253G  Compagnie de Saint-Gobain  24 April 2025

 The worldwide leader

in light & sustainable construction

 

 

First-quarter 2025 sales up 3.2%

 

 

·    Clear sequential improvement in volumes in Q1 2025, stable at
comparable working days versus Q1 2024

 

·    Prices up 0.8%

 

·    Decisive strategic steps with 2 acquisitions completed in
construction chemicals: Cemix (Latin America) and FOSROC (India and Middle
East)

 

·    2025 outlook confirmed: the Group expects an operating margin of more
than 11.0%

 

 

 

Benoit Bazin, Chairman and Chief Executive Officer, commented:

"Sales growth in the first quarter reflected the success of the Group's
strategic execution and, as expected, improving trends in certain markets, in
particular Europe. In a mixed macroeconomic environment and with geopolitical
uncertainty requiring ever more regionalization, Saint-Gobain can count on the
strength of its decentralized, country-by-country organization and on the
balanced contribution of its different geographical zones. Thanks to its local
value chains - industrial footprint, logistics, procurement, branding, sales
and customers - the Group is ideally positioned on local construction markets,
with no direct exposure to customs tariffs.

Across the globe, our unique range of solutions allows us to continue to
outperform, thanks to the excellent execution of our teams who have
demonstrated their capacity to manage what is under their control and their
strong ability to adapt."

 

 

Sales as reported were up 3.2% to €11.7 billion, with a negative 0.4%
currency effect (more negative at the end of the period), and a positive 3.9%
Group structure impact, primarily reflecting four recent acquisitions
reinforcing Saint-Gobain's profitable growth profile: CSR in Australia, Bailey
in Canada, Cemix in Latin America and FOSROC in India and the Middle East. The
optimization of the Group's profile also continued through disposals, in
particular the pipe drainage business (PAM Building).

 

Like-for-like sales were down 0.3%, with growth in the Americas, Asia-Pacific
and Northern Europe. Volumes stabilized at comparable working days (down 1.1%
at actual working days), representing a clear sequential improvement on
fourth-quarter 2024 (down 2.6%). Prices were up 0.8% supported by disciplined
execution in a slightly inflationary cost environment overall, and by the
added value that our comprehensive, sustainable and innovative solutions bring
to our customers.

 

 

Segment performance (like-for-like sales)

 

Europe: further sequential improvement driven by growth in Northern Europe

Sales in Europe were down 2.2% over the quarter, with a negative volume effect
of 1.7% - a clear improvement on fourth-quarter 2024 (negative volume effect
of 3.3%) - with construction markets either stabilizing or beginning to
recover, depending on the country.

 

-  Northern Europe was up 2.0%, with volume growth in all our main countries,
including the Nordics. Renovation in the Region returned to growth, driven by
the rise in existing home transactions and improved household purchasing
power. Against a high comparison basis, prices stabilized thanks to targeted
price increases. The comprehensive range of sustainable solutions in each
country helped fuel this good sales momentum. Germany's adoption of a
large-scale stimulus package is a positive sign for the country and for Europe
as a whole.

 

-  Southern Europe, Middle East & Africa contracted 4.9%, a slight
sequential improvement that confirms that France reached a low point in
fourth-quarter 2024. Saint-Gobain continues to benefit from its renovation
exposure and its comprehensive range of innovative solutions that meet both
residential and non-residential construction needs. France's leading
indicators are encouraging, with a recent rise in existing home transactions,
growth in lending, and the beginning of a recovery in housing starts after
three years of decline. Spain-Italy saw growth, along with the Middle East and
Africa, driven by Egypt which benefited from recent investments. Prices were
up sequentially in the Region thanks to targeted price increases, but remained
slightly down compared to first-quarter 2024 against a high comparison basis.

 

Americas: sales growth

The Region delivered 3.0% organic sales growth, with a good level of activity
once again in North America and good momentum in Latin America.

 

-  North America was up by 1.0%, driven by prices and good volumes in
renovation. In a more uncertain environment, Saint-Gobain is protected from
the impact of customs tariffs thanks to its highly local business model. The
Group benefits from strong exposure to the renovation market (over 50% of
sales), particularly through its must-have roofing solutions, for which demand
continued to exceed supply. The new construction market has stabilized at a
level below structural construction needs, with interest rates remaining high.
With 58 plants in the US and 33 in Canada serving local construction markets,
Saint-Gobain is extremely well placed to continue its outperformance, thanks
to its comprehensive range of light construction solutions offering high
value-add for customers. Constructing sustainable buildings that are more
resistant to climate hazards represents a significant driver of
differentiation for the Group. The most recent innovations capturing market
share include the development of FireLITE(®), a lightweight fire-resistant
plasterboard solution for the non-residential market, and growth in sales of
ClimateFlex(®) products, a reinforced roofing technology resistant to extreme
weather events, integrated within the new multi-product FORTIFIED Roof™
system, addressing the recommendations of insurance companies.

 

-  Latin America was up 9.8%, driven by continued growth in Brazil against a
favorable comparison basis and by market share gains in light construction.
The other countries in the Region also benefited from good momentum thanks to
the enhanced offering and mix and to the Cemix acquisition, finalized in
mid-January, which accelerates Saint-Gobain's development in construction
chemicals in fast-growing regions.

 

Asia-Pacific: good sales momentum

The Region reported robust organic growth of 3.9%, driven by strong momentum
in India, which more than offset the downturn in China.

 

India saw further double-digit volume growth, driven by its comprehensive and
innovative range of sustainable solutions, allowing the Group to continue to
capture market share. China continued to be affected by the downturn in the
new construction market, despite a better performance in renovation. Growth in
South-East Asia was led by Vietnam thanks to customized digital services, the
rollout of new product lines and the launch of low-carbon solutions including
the FutuRE range of mortars and DURAflex(®) lightweight board. The
integration of CSR is progressing well in terms of both operational
performance and the development of complete solutions for the Australian
market.

 

High Performance Solutions (HPS): sales stable

HPS sales remained stable over the quarter, helped by a good performance from
construction businesses.

 

-  Businesses serving construction customers were up by 3.4% owing to the
upturn in Adfors reinforcement solutions - exposed to construction in Central
Europe - and to growth in the Construction Chemicals business (up 26% as
reported) driven by infrastructure projects and the innovation drive for
decarbonization in the construction sector. The FOSROC acquisition was
completed during February, accelerating the Group's construction chemicals
presence in countries with strong structural growth (India, Middle East and
Asia-Pacific).

 

-  Mobility performed well (up 0.9%), despite ongoing challenges in the
automotive market, benefiting from its positioning on high value-added models
and from its innovation investments.

 

-  Businesses serving Industry contracted slightly (down 2.6%), affected by a
certain wait-and-see attitude due to geopolitical uncertainties.

 

2025 outlook

 

In a macroeconomic environment that remains contrasted, Saint-Gobain will
continue to demonstrate a very strong operating performance in 2025. Assuming
no major slowdown in global growth linked to geopolitical uncertainties, the
Group expects the following trends:

·    Europe: construction markets stabilizing, with a gradual recovery
country-by-country expected in the second half;

·    Americas: a good level of activity maintained in North America and
Latin America;

·    Asia-Pacific: growth led mainly by India, South-East Asia and the
integration of CSR in Australia;

·    High Performance Solutions: dynamic growth in Construction
Chemicals; Mobility to hold firm thanks to its high value-added solutions;
industrial markets affected by a certain wait-and-see attitude.

 

 

 

Saint-Gobain expects an operating margin of more than 11.0% in 2025

 

 

Financial calendar

A conference call will be held at 6:30pm (Paris time) on April 24, 2025:

dial +44 20 3059 5875, +1 718 705 8795 or +33 1 70 91 87 14 (code 4276084#).

 

·    First-half 2025 results: Thursday July 31, 2025, after close of
trading on the Paris stock exchange.

·    Investor Day: Monday October 6, 2025.

·    Sales for the third quarter of 2025: Thursday October 30, 2025, after
close of trading on the Paris stock exchange.

 

 Analyst/investor relations                Press relations
 Vivien Dardel:         +33 1 88 54 29 77  Patricia Marie:   +33 1 88 54 26 83
 Floriana Michalowska:  +33 1 88 54 19 09  Laure Bencheikh:  +33 1 88 54 26 38
 Alix Sicaud:           +33 1 88 54 38 70  Yanice Biyogo:                +33 1 88 54 27 96
 James Weston:          +33 1 88 54 01 24

Glossary:

- Indicators of organic growth and like-for-like changes in sales/operating
income reflect the Group's underlying performance excluding the impact of:

•     changes in Group structure, by calculating indicators for the year
under review based on the scope of consolidation of the previous year (Group
structure impact);

•     changes in foreign exchange rates, by calculating indicators for
the year under review and those for the previous year based on identical
foreign exchange rates for the previous year (currency impact);

•     changes in applicable accounting policies.

- Operating income: see Note 5 to the consolidated financial statements at
December 31, 2024, available by clicking here:
https://www.saint-gobain.com/en/news/2024-results
(https://www.saint-gobain.com/en/news/2024-results)

- Operating margin = operating income divided by sales

 

 

 

 

 

Important disclaimer - forward-looking statements:

This press release contains forward-looking statements with respect to
Saint-Gobain's financial condition, results, business, strategy, plans and
outlook. Forward-looking statements are generally identified by the use of the
words "expect", "anticipate", "believe", "intend", "estimate", "plan" and
similar expressions. Although Saint-Gobain believes that the expectations
reflected in such forward-looking statements are based on reasonable
assumptions as at the time of publishing this document, investors are
cautioned that these statements are not guarantees of its future performance.
Actual results may differ materially from the forward-looking statements as a
result of a number of known and unknown risks, uncertainties and other
factors, many of which are difficult to predict and are generally beyond the
control of Saint-Gobain, including but not limited to the risks described in
the "Risk Factors" section of Saint-Gobain's 2024 Universal Registration
Document, available on Saint-Gobain's website (www.saint-gobain.com
(http://www.saint-gobain.com) ). Accordingly, readers of this document are
cautioned against relying on these forward-looking statements. These
forward-looking statements are made as of the date of this document.
Saint-Gobain disclaims any intention or obligation to complete, update or
revise these forward-looking statements, whether as a result of new
information, future events or otherwise, except as required by applicable laws
and regulations.

This press release does not constitute any offer to purchase or exchange, nor
any solicitation of an offer to sell or exchange securities of Saint-Gobain.

 

For further information, please visit www.saint-gobain.com
(http://www.saint-gobain.com)

Appendix 1: Sales by Segment

 

                                   Q1 2024     Q1 2025     Change on actual structure basis  Change on a comparable structure basis  Like-for-like change

(in €m)
(in €m)

 Northern Europe                   2,779       2,835       +2.0%                             +2.2%                                   +2.0%
 Southern Europe, ME & Africa      3,617       3,435       -5.0%                             -5.1%                                   -4.9%
 Americas                          2,349       2,523       +7.4%                             +1.7%                                   +3.0%
 Asia-Pacific                      504         762         +51.2%                            +4.1%                                   +3.9%
 High Performance Solutions        2,420       2,465       +1.9%                             -0.6%                                   +0.0%
 Internal sales and misc.          -313        -303        ---                               ---                                     ---
 Group Total                       11,356      11,717      +3.2%                             -0.7%                                   -0.3%

 

 

Appendix 2: Contribution of prices and volumes to organic sales growth by
Segment

 

 Q1 2025                           Like-for-like change  Prices  Volumes
 Northern Europe                   +2.0%                 -0.1%   +2.1%
 Southern Europe, ME & Africa      -4.9%                 -0.9%   -4.0%
 Americas                          +3.0%                 +3.6%   -0.6%
 Asia-Pacific                      +3.9%                 -1.5%   +5.4%
 High Performance Solutions        +0.0%                 +1.9%   -1.9%
 Group Total                       -0.3%                 +0.8%   -1.1%

 

 

Appendix 3: Breakdown of organic sales growth and external sales

 Q1 2025                           Like-for-like change                                                            % Group

 Northern Europe                   +2.0%                                                                           23.1%
 Nordics                           +2.9%                                                                           10.7%
 United Kingdom - Ireland          -0.5%                                                                           3.6%
 Germany - Austria                 +1.6%                                                                           2.8%
 Southern Europe, ME & Africa      -4.9%                                                                           28.6%
 France                            -7.0%                                                                           21.2%
 Spain - Italy                     +1.4%                                                                           4.1%
 Americas                          +3.0%                                                                           21.1%
 North America                     +1.0%                                                                           16.0%
 Latin America                     +9.8%                                                                           5.1%
 Asia-Pacific                      +3.9%                                                                           6.4%
 High Performance Solutions        +0.0%                                                                           20.8%
 Construction and industry         -0.7%                                                                           13.2%
 Mobility                          +0.9%                                                                           7.6%
 Group Total                       -0.3%                                                                           100.0%

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact
rns@lseg.com (mailto:rns@lseg.com)
 or visit
www.rns.com (http://www.rns.com/)
.

RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our
Privacy Policy (https://www.lseg.com/privacy-and-cookie-policy)
.   END  QRFPPUMPCUPAGQC