REG - Compagnie St-Gobain - 2021 Annual Results
24/02/2022 17:30
For best results when printing this announcement, please click on link below:
http://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20220224:nRSX7742Ca&default-theme=true
RNS Number : 7742C Compagnie de Saint-Gobain 24 February 2022
The worldwide leader
in light & sustainable construction
2021 Annual Results
Record growth, earnings and margin
· Record organic growth up 18.4% on 2020 and 13.8% on 2019:
outperformance (volumes up 6.2% on 2019) on very dynamic underlying markets
and with an acceleration in prices (up 10.3% in Q4), generating a positive
price-cost spread of €60 million in 2021
· Record operating income and margin: up 60% on 2020 and 39% on
2019(1) at €4,507 million; margin at 10.2% (a rise of 250 bps over the
three years of transformation)
· Record recurring net income of €2,815 million, up 91% on 2020 and
47% on 2019
· Free cash flow up 56% on 2019 at €2,904 million, with a conversion
ratio of 53%
· Strong value creation, with ROCE at a record high of 15.3% (versus
11.1% in 2019)
· Record shareholder return at €1.2 billion in 2021 through share
buybacks and dividends; TSR(2) at 69% for the year. Dividend of €1.63 (up
23%) recommended for 2021, and commitment to buy back at least €400 million
in shares in 2022
· Continued progress in sustainability performance, with a further
reduction in scope 1 and 2 CO(2) emissions in 2021 despite the sharp 11.7%
year-on-year increase in volumes, representing a reduction of 23% on 2017
· Successful launch of the "Grow & Impact" plan, with first-year
results in line with or ahead of all objectives
New growth and profitability profile confirmed
2022: another year of growth in operating income
at constant exchange rates
1. Like-for-like.
2. TSR: Total Shareholder Return for Saint-Gobain in 2021, including
the reinvestment of the dividend in Saint-Gobain stock.
Benoit Bazin, Chief Executive Officer of Saint-Gobain, commented:
"Thanks to our extremely committed teams, the Group has demonstrated the full
benefits of its profound transformation and proven its ability to structurally
accelerate its profitable growth on markets which look especially
well-oriented over the long term. As the worldwide leader in
light and sustainable construction, Saint-Gobain plays a key role in the
fight against climate
change. Our teams work relentlessly to maximize our positive impact by
offering our customers a comprehensive and unbeatable range of sustainable
solutions, representing 72% of Group sales.
The records achieved in 2021 confirm that the Group has entered a new
post-transformation trajectory in terms of performance: market-beating sales
growth, record earnings and margin, a high level of free cash flow generation
that has more than doubled compared to previous years, and strong value
creation for our shareholders thanks to strict capital allocation and the
determined execution of our portfolio optimization. With €2 billion in sales
divested in 2021 and €5.6 billion since end-2018, as well as almost €2
billion in sales acquired or in the process of being acquired in 2021 (mainly
Chryso and GCP Applied Technologies), Saint-Gobain has continued its strongly
value-creating strategy and has established itself as a major global player in
high-growth segments such as construction chemicals. This performance was
accompanied by major progress against our sustainability commitments, notably
with the continuing reduction in our carbon emissions.
Building on this profound and lasting cultural and financial transformation,
Saint-Gobain goes into 2022 with the confidence to continue the momentum
generated by its "Grow & Impact" plan. Against a backdrop of structurally
supportive markets, Saint-Gobain is targeting a further increase in operating
income in 2022 versus 2021 at constant exchange rates."
2021-2025 "Grow & Impact" plan: successful execution of the 1(st)
year
Sustainable construction and industry decarbonization are essential in the
fight against climate change. As the worldwide leader in light and sustainable
construction, Saint-Gobain therefore plays a key role in reaching carbon
neutrality.
The first year of the "Grow & Impact" plan has already proved a success,
and sets the Group firmly on the financial trajectory set at its Capital
Markets Day, with an acceleration in earnings and cash generation, along with
attractive value creation for our shareholders:
- Strong organic growth with an annual average of 6.9% over the period
2019-2021, ahead of the 3%-5% target, maximizing Saint-Gobain's positive
impact in the fight against climate change. Its comprehensive range of
sustainability solutions for its customers represents 72% of Group sales. The
solutions sold by Saint-Gobain across the globe in one year result in around
1,300 million tons of avoided CO(2) emissions over their lifespan, i.e.,
around 40 times the Group's own total carbon footprint in 2020 (scopes 1, 2
and 3), and more than 100 times its scope 1 and 2 footprint;
- Operating margin of 10.2%, in line with the Group's double-digit margin
ambition;
- Free cash flow conversion ratio of 53%, in line with the objective of over
50%, with free cash flow generation that has more than doubled since the
launch of the transformation at the end of 2018, at €2.9 billion;
- Strong value creation, with ROCE at 15.3% - ahead of the target of
12%-15% - compared to 10.4% in 2020 and 11.1% in 2019;
- Record shareholder return at €1.2 billion.
Operating performance
Like-for-like sales were up 18.4% on 2020 and 13.8% on 2019, with the
increase accelerating to 15.9% in the second half versus second-half 2019.
In a far more inflationary raw material and energy cost environment, the Group
once again showed its ability to increase sales prices and generate a positive
price-cost spread in 2021. The price effect was a positive 6.7% for 2021 as a
whole, steadily increasing throughout the year to stand at 9.5% in the second
half and 10.3% in the fourth quarter.
In line with the third quarter, and as expected, there was a modest rise in
volumes, up 0.6% over the second half given the very high comparison basis in
2020, when trade professionals in Europe had taken less holiday during the
summer and over the Christmas and New Year period owing to the coronavirus
pandemic. Compared to second-half 2019, volumes were up by 4.9%, with an
acceleration between the third and fourth quarters (up 3.6% and 6.0%,
respectively) in all Group segments.
On a reported basis, sales came in at a record high of €44,160 million, with
a negative currency effect of 0.4% over the year, but a positive effect of
1.7% in the second half, due mainly to the appreciation of the British pound,
Nordic krona and the US dollar in the fourth quarter alone.
The Group structure impact reduced sales by 2.2% over the year and by 3.6% in
the second half, reflecting the ongoing optimization of the Group's profile,
with €5.6 billion in total sales divested or signed to date since the launch
of the transformation at the end of 2018. In 2021 alone, Saint-Gobain
completed or signed 20 divestments representing €2.0 billion in sales,
including mainly Lapeyre in France, Distribution in the Netherlands and Spain,
specialized Distribution in the UK, Glassolutions in Germany and Denmark, and
Pipe in China.
During the year the Group completed or signed 37 acquisitions representing
almost €2.0 billion in sales, including mainly Chryso and GCP Applied
Technologies (GCP) - reinforcing its existing positions to make it a major
global player in construction chemicals with more than €4 billion in sales -
and Panofrance, a specialist distributor of timber and panels. The integration
of Chryso is progressing particularly well and the company is consolidated in
the Group's financial statements as from fourth-quarter 2021, with objectives
set at the date of the acquisition exceeded in 2021 in terms of both sales
(€431 million, up 26% like-for-like on 2019) and EBITDA (€87 million).
Continental Building Products (plasterboard in the US), acquired in February
2020, created value in the second year - one year earlier than targeted -
thanks to a strong operating performance and a rapid and seamless integration:
sales totaled USD 605 million in 2021, with EBITDA at USD 185 million,
representing an EBITDA margin of 30.6%, and synergies exceeded initial
expectations, at an annualized rate of USD 50 million.
Note that in light of the hyperinflationary environment in Argentina, this
country which represents less than 1% of the Group's consolidated sales, is
excluded from the like-for-like analysis.
Operating income rose sharply, reaching a new all-time high of
€4,507 million, a rise of 58% on a reported basis versus 2020 and of 33%
versus 2019. Operating income was up by 60% and 39%, respectively, on a
like-for-like basis.
Saint-Gobain's operating margin rose to a record level of 10.2% in 2021 (from
7.5% in 2020 and 8.0% in 2019), i.e., an increase of 250 basis points since
the launch of the Group's transformation at the end of 2018 and at the level
of the best sector performers in both industry and merchanting.
In 2021, the Group benefited from:
- A structurally improved post-pandemic volume dynamic, supported by
market share gains, leveraging its comprehensive range of solutions developed
within the scope of a multi-local organization, with strongly empowered local
management as close to customers as possible;
- Good trends in sales prices, generating a positive raw material and
energy price-cost spread of €60 million;
- An optimized profile and portfolio delivering a structural improvement
in its profitable growth with a positive impact on the operating margin;
- €150 million in cost savings resulting from the post-coronavirus
adaptation measures launched in 2020, along with the rigorous execution of our
ongoing operational excellence program.
Segment performance (like-for-like sales)
Northern Europe: strong sales momentum on the renovation market and record
margin
Sales in the Northern Europe Region were up by 15.5% year-on-year and by 12.1%
on 2019, with a stronger 14.9% increase in the second half of the year versus
second-half 2019 thanks to a good fourth quarter on structurally supportive
renovation markets. The Region's operating margin hit an annual record high of
7.3% (versus 6.2% in 2020 and 6.3% in 2019), supported by good volume trends,
an optimized business profile and a strong acceleration in prices at the end
of the year.
Nordic countries reported robust growth over the year as a whole, particularly
in sales through distribution and light construction solutions, on a
supportive renovation market. Our e-commerce platforms proved especially
dynamic, representing up to 30% of sales in specialty segments. Investments in
Norway aimed at transforming our Fredrikstad factory into the world's first
carbon-neutral plasterboard plant made good progress. Despite the impact of
the automotive market contraction on demand for glass, Germany ended the year
with an acceleration thanks to sales of light and sustainable construction
solutions and should benefit from stimulus measures in the energy efficiency
renovation segment in 2022. The UK saw an acceleration in growth in the second
half compared to second-half 2019 - in the context of an optimized network -
driven by prices and an improvement in sales through distribution, despite
certain logistical difficulties affecting supply chains. Eastern Europe
enjoyed strong growth in its main markets, particularly Poland, the Czech
Republic and Russia, although the latter represents only around 0.5% of the
Group's sales.
Southern Europe - Middle East & Africa: strong sales momentum on the
renovation market and record margin
Sales for the Southern Europe - Middle East & Africa Region rose by 20.3%
year-on-year - with all countries reporting double-digit growth - and by 13.9%
compared to 2019, with an acceleration to 14.9% in the second half versus
second-half 2019 thanks to a good fourth quarter on structurally supportive
renovation markets. The operating margin for the Region came in at an annual
record high of 8.3% (versus 5.2% in 2020 and 5.4% in 2019) owing to several
factors: very good volumes and an outperformance on the renovation market and
in sustainable construction solutions, productivity gains from our teams, a
highly optimized post-transformation profile following in particular the
positive impact of disposals, and a strong acceleration in prices at the end
of the year.
France continues to enjoy good momentum, driven by renovation markets and
energy efficiency solutions. The Group has benefited from France's household
stimulus package MaPrimeRenov', which represents €2 billion in subsidies
distributed for over 600,000 projects approved over the year. In terms of
renovation of public buildings, the first effects of the stimulus plan should
begin to be seen in 2022. Saint-Gobain continued to capture market share
during the year in France. It benefited from its unique and dense presence
across the entire value chain: from the manufacture of sustainable solutions
to their distribution - in stores offering advice, training, digital services,
and logistics or recycling solutions to our hundreds of thousands of trade
professional customers, as well as on e-commerce platforms or our site
offering inspiration and intermediation, La Maison Saint-Gobain. The
acquisition of Panofrance enriches the Group's offer in the high-potential
modular timber solutions market. Spain advanced, particularly in light
construction solutions as well as in construction chemicals, and despite the
closure of a flat glass manufacturing plant in 2020 as part of the
optimization of our industrial footprint. To support this robust growth, a new
plasterboard facility equipped with the very latest technologies will be
operational in the country in 2022 at Quinto. Italy leveraged the Group's
comprehensive solutions offering to fully benefit from the country's continued
support for energy-efficient renovation in the form of tax credits.
Benelux also progressed, as did the Middle East and Africa, where we opened 5
plants increasing our presence to 21 countries in 2021, with strong growth in
Turkey and Egypt.
Americas: strong sales growth and increase in margin to an all-time high
The Americas Region delivered 22.3% organic growth over the year compared to
2020, and 28.3% compared to 2019, with an acceleration in the second half at
31.3% versus second-half 2019 thanks to good momentum in the fourth quarter.
The operating margin for the Region came in at an annual record high of 16.5%
(versus 11.5% in 2020 and 10.1% in 2019), mainly supported by strong growth in
volumes and a strong positive raw material and energy price-cost spread.
- North America progressed by 21.6% over the year versus 2019, and by 23.5%
in the second half of 2021, driven by an acceleration in prices and a good
volume dynamic in light construction solutions. Our local organization enabled
us to mitigate strong tensions on supply chains throughout the year -
particularly for raw materials - and to strengthen our customer relationships.
The successful integration of Continental in early 2020 not only helped
strengthen the Group's position on the US plasterboard market, but also helped
develop a shared Saint-Gobain solutions offer for new sales channels, thereby
improving our value proposition and differentiation for our customers thanks
to these sales synergies.
- Latin America achieved further strong growth in terms of both prices - to
offset inflation - and volumes. Sales in the Region grew by 42.5% over the
year compared to 2019, and by 47.7% in the second half driven by the
acceleration in prices. Brazil benefited from its comprehensive range of
solutions in 2021, strengthening its market presence and improving its
efficiency and customer service. Growth was also supported by our development
in Argentina, Chile, Peru, Mexico and Columbia, thanks to new plant openings
and acquisitions to reinforce our presence in the region.
Asia-Pacific: strong sales growth and record margin
The Asia-Pacific Region reported 28.5% growth versus 2020 and 17.0% growth
versus 2019, including 17.8% in the second half versus second-half 2019. The
operating margin for 2021 came in at an annual record high of 11.8% (versus
10.7% in 2020 and 10.6% in 2019), supported by good momentum in volumes.
India delivered a strong performance in 2021, despite an unstable health
situation throughout the year. The Group captured market share in the country,
thanks to its leadership in promoting energy- and resource-efficient
buildings, an integrated and innovative range of solutions for the residential
market (Home & Hospitality), and the introduction of new ranges of
construction chemicals. The integration of Rockwool India in stone wool
insulation, expected to be completed by the end of first-quarter 2022, will
help continue this overall dynamic. China enjoyed very strong growth in 2021,
benefiting from market share gains thanks to its positioning on high
value-added segments, in an upbeat market. Several development projects will
help accelerate growth in light and sustainable construction, including new
gypsum lines and waterproofing solutions. Although South-East Asia returned to
growth overall at the end of the year compared to 2019, driven by Vietnam
where the Group continued to capture market share, its 2021 performance was
affected by the numerous health restrictions imposed in light of the
coronavirus pandemic.
High Performance Solutions (HPS): good growth in sales versus 2019 excluding
Mobility
HPS sales were up by 14.5% year-on-year and by 3.3% compared to 2019, with a
stronger 4.6% increase in the second half versus second-half 2019 thanks to
upbeat industrial markets in the fourth quarter, with the exception of
automotive in Europe. Against this backdrop, the operating margin came in at
12.4% for the year (versus 9.4% in 2020 and 12.7% in 2019), continuing to be
affected by Mobility in Europe.
- Businesses serving the Construction Industry outperformed the market with
11.8% growth versus 2019, continuing to benefit from upbeat trends in textile
solutions for external thermal insulation systems (ETICS) thanks to good
momentum in sustainable construction. This growth was supported by the
increase in production capacities for textile solutions. The integration of
Chryso got off to a very good start: the company is consolidated as from
fourth-quarter 2021 and sales trends are very positive, ahead of the
expectations set at the time of the acquisition.
- The Mobility business remained slightly below 2019 levels (down 3.1%),
but returned to growth in the fourth quarter (up 1.7%) driven by a progression
in sales to the Americas and China, particularly in electric vehicles, which
now represent around 20% of our automotive sales. Europe remained down, as the
shortage of semi-conductors weighed on automotive manufacturers' production
capacities. However, thanks to its very strong positioning in electric
vehicles and high value-added products, the Mobility business continued to
significantly outperform the automotive market.
- Businesses serving Industry progressed 6.4% on 2019, supported by
positive trends in surface finishing solutions and innovation in
decarbonization technologies for our customers, such as Saint-Gobain's
expertise in specialty materials that help significantly reduce CO(2)
emissions from many different industrial processes and applications (e.g.,
ceramic refractories for glass manufacturers). Although the year-on-year
rebound in activities relating to investment cycles intensified throughout the
year, these activities remain slightly down on 2019.
Analysis of the 2021 consolidated financial statements
The 2021 consolidated financial statements were approved and adopted by
Saint-Gobain's Board of Directors at its meeting of February 24, 2022. The
consolidated financial statements were audited and certified by the statutory
auditors.
2019 2020 2021 % change
in € million 2021/2019 2021/2020
Sales 42,573 38,128 44,160 3.7% 15.8%
Operating income 3,390 2,855 4,507 32.9% 57.9%
Operating depreciation and amortization 1,901 1,902 1,934 1.7% 1.7%
Non-operating costs -421 -342 -239 43.2% 30.1%
EBITDA 4,870 4,415 6,202 27.4% 40.5%
Capital gains and losses on disposals, asset write-downs and impact of changes -416 -1,081 -332 20.2% 69.3%
in Group structure
Business income 2,553 1,432 3,936 54.2% 174.9%
Net financial expense -496 -453 -408 17.7% 9.9%
Dividends received from investments 28 34 1 n.s. n.s.
Income tax -631 -526 -919 -45.6% -74.7%
Share in net income of associates 0 2 4 n.s. n.s.
Net income before non-controlling interests 1,454 489 2,614 79.8% 434.6%
Non-controlling interests 48 33 93 93.8% 181.8%
Net attributable income 1,406 456 2,521 79.3% 452.9%
Earnings per share(2) (in €) 2.59 0.85 4.79 84.9% 463.5%
Recurring net income(1) 1,915 1,470 2,815 47.0% 91.5%
Recurring(1) earnings per share(2) (in €) 3.53 2.74 5.35 51.6% 95.3%
EBITDA 4,870 4,415 6,202 27.4% 40.5%
Depreciation of right-of-use assets -682 -675 -679 0.4% -0.6%
Net financial expense -496 -453 -408 17.7% 9.9%
Income tax -631 -526 -919 -45.6% -74.7%
Capital expenditure(3) -1,818 -1,236 -1,591 -12.5% 28.7%
o/w additional capacity investments 536 371 516 -3.7% 39.1%
Changes in working capital requirement 78 1,148 -217 -378.2% -118.9%
Free cash flow(4) 1,857 3,044 2,904 56.4% -4.6%
Free cash flow conversion(5) 44% 81% 53%
ROCE 11.1% 10.4% 15.3%
Lease investments 955 833 769 -19.5% -7.7%
Investments in securities net of debt acquired(6) 304 1,423 1,352 344.7% -5.0%
Divestments 1,052 2,567 322 -69.4% -87.5%
Consolidated net debt 10,491 7,181 7,287 -30.5% 1.5%
1. Recurring net income = net attributable income excluding capital gains
and losses on disposals, asset write-downs and material non-recurring
provisions.
2. Calculated based on the weighted average number of shares outstanding
(526,244,506 shares in 2021, versus 536,452,195 shares in 2020).
3. Capital expenditure = investments in tangible and intangible assets.
4. Free cash flow = EBITDA less depreciation of right-of-use assets, plus
net financial expense, plus income tax, less capital expenditure excluding
additional capacity investments, plus change in working capital requirement.
5. Free cash flow conversion ratio = free cash flow divided by EBITDA,
less depreciation of right-of-use assets.
6. Investments in securities net of debt acquired: €1,352 million in
2021, of which €1,319 million in controlled companies.
EBITDA climbed 40% on 2020 and 27% on 2019 to a record €6,202 million,
while the EBITDA margin came in at a record annual high of 14.0% versus 11.6%
in 2020. Non-operating costs included in EBITDA decreased to €239 million
from €342 million in 2020, in line with the objective given at the Group's
Capital Markets Day.
The net balance of capital gains and losses on disposals, asset write-downs
and the impacts of changes in Group structure represented an expense of €332
million (versus an expense of €1,081 million in 2020), reflecting €265
million in asset write-downs relating mainly to the divestment of
underperforming businesses, and €67 million in disposal losses and impacts
relating to changes in Group structure. Business income was €3,936 million,
up 54% on 2019.
Net financial expense excluding dividends from investments improved, at €408
million versus €453 million in 2020.
The tax rate on recurring net income was 24%, slightly lower than in 2019
(25%). Income tax was €919 million, including an exceptional €106 million
which relates to deferred tax in the UK (liability method) following the rise
in the corporate income tax rate from 19% to 25%.
Recurring net income hit an all-time high of €2,815 million (excluding
capital gains and losses on disposals, asset write-downs and material
non-recurring provisions), up 47% from €1,915 million in 2019.
Net attributable income amounted to €2,521 million, up 79% on the 2019
figure of €1,406 million.
Capital expenditure represented €1,591 million, up on the abnormally low
figure in 2020 but down 12.5% on 2019. In 2021, growth capex was up by 40% on
2020: the Group opened 21 new plants and production lines to bolster its
leading positions on the fast-growing markets of construction chemicals and
light construction. Its main growth projects concerned (i) sustainable
construction and construction chemicals in Asia (Malaysia and China), Latin
America (Brazil, Peru and Chile), Africa (Ivory Coast and Angola), the Middle
East (Saudi Arabia), Europe (Czech Republic) and Turkey, and (ii) façade and
light construction solutions in emerging countries (Mexico, India and China),
in the United States and in Spain. In North America, Saint-Gobain has decided
to invest more than USD 400 million over the next three years to increase its
production capacities in plasterboard, roofing and insulation.
Free cash flow remained high, at €2,904 million, a rise of 56% on 2019. The
free cash flow conversion ratio was 53% versus 44% in 2019, buoyed by strong
growth in EBITDA, a continuing low working capital requirement (WCR) and the
decrease in maintenance capex. Operating WCR represented 17 days' sales at
December 31, 2021, representing a historic low for the second consecutive year
(compared to 18 days at end-2020 and 27 days at end-2019), thanks to efforts
to monitor overdue receivables and despite the first steps taken to rebuild
inventories in order to best serve its customers.
ROCE hit an all-time high of 15.3% (versus 11.1% in 2019), resulting in
strong value creation for our shareholders, in both industry and merchanting.
Investments in securities net of debt acquired totaled €1,352 million
(€1,423 million in 2020), and related primarily to the acquisition of Chryso
in the construction chemicals segment - but also Duraziv in Romania and Z
Aditivos in Peru - the bolt-on acquisitions of Panofrance and Raboni Normandie
in France; Brüggemann in modular construction in Germany; and a joint venture
investment in Massfix, a glass recycling company, to develop the circular
economy in Brazil. In total, acquisitions made by the Group in 2021 represent
approximately €820 million in full-year sales and approximately €125
million in EBITDA.
Divestments totaled €322 million, corresponding essentially to the sale of
Lapeyre, the distribution business in the Netherlands and Spain, the
specialized plumbing, heating and sanitaryware distribution business in the UK
(Graham), and the Pipe business in China.
Net debt remained virtually stable at €7.3 billion at December 31, 2021
(€7.2 billion at end-2020 and €10.5 billion at end-2019). It benefited
from strong free cash flow generation which allowed us to enhance our capital
allocation and shareholder return policy (€1.2 billion distributed via
dividend payouts and the buyback of almost 9 million Saint-Gobain shares). The
Group was therefore able to invest €1.6 billion in capital expenditure and
€1.4 billion in acquisitions. Net debt represents 35% of consolidated equity
compared to 39% at December 31, 2020. The net debt to EBITDA ratio on a
rolling 12-month basis was 1.2 (around 1.5 with the GCP acquisition on a pro
forma basis) compared to 1.6 at December 31, 2020.
Environmental, Social, Governance (ESG) performance
Thanks to its positive-impact solutions, Saint-Gobain plays a key role in
building a carbon-neutral economy. The Group continued to make significant
progress in environmental and social matters in 2021, allowing it to reduce
its footprint while maximizing its positive impact, in line with its "Grow
& Impact" strategy and thanks to the strong commitment of its
employees. Around 60,000 Group employees are Saint-Gobain shareholders, in 48
countries. In the 2021 survey, employees showed their strong belief in the
Group's vision and strategy, with an impressive industry-leading engagement
rate up 4 points in 2 years at 83%, confirming the pride, loyalty and
satisfaction of our teams (82% in 2020, 79% in 2019).
Reduce the Group's environmental footprint:
In 2021, the Group scored 66 on the new composite sustainability index -
defined in October 2021 - compared to 50 in 2017, and is therefore already
one-third of the way towards meeting its 2030 goal of 100. This illustrates
our combined efforts to reduce carbon emissions (scopes 1 and 2), water
withdrawal and non-recovered waste, and to increase avoided virgin raw
materials by incorporating recycled materials into our products.
Maximize the Group's positive impact:
The comprehensive range of sustainable solutions for its customers represents
72% of Saint-Gobain's sales: our solutions enable CO(2) emissions to be
reduced during their use, favor the circular economy, the preservation of
natural resources, and the well-being of the population at large (health and
safety; acoustic, thermal and visual comfort; air quality; ergonomics, etc.).
The solutions sold by Saint-Gobain across the globe in one year result in
around 1,300 million tons of avoided CO(2) emissions over their lifespan,
i.e., around 40 times the Group's own total carbon footprint in 2020 (scopes
1, 2 and 3), and more than 100 times its scope 1 and 2 footprint.
Significant ESG progress in 2021:
- Climate change and the circular economy: act to reduce our carbon
footprint thanks to our 2030 roadmap towards carbon neutrality by 2050. There
was a further reduction in scope 1 and 2 CO(2) emissions in 2021, down to
10.3 million tons - despite the sharp 11.7% year-on-year increase in volumes -
representing a reduction of 23% since 2017, in line with the 2030 objective of
a 33% reduction, as validated by the Science-Based Targets initiative (SBTi).
· Growth decoupled from its CO(2) emissions: 0.23kg of CO(2) per euro
of sales, representing a reduction of around 15% on 2020 and of almost 30% on
2017; 1.67kg of CO(2) per euro of EBITDA, representing a reduction of
approximately 30% on 2020 and of more than 50% on 2017;
· Increase in the proportion of ESG-linked compensation: from 5% to
10% for short-term compensation (CO(2) emissions reduction criterion added to
the safety criterion), and from 15% to 20% for long-term compensation
(increase in the weighting of the CO(2) emissions reduction criterion from 5%
to 10%, along with criteria based on safety and diversity, each accounting for
5%);
· Two-fold increase over one year in green electricity as a
proportion of the Group's total electricity consumption, at nearly 40%, in
line with targets;
· Capital expenditure and R&D investments focused on the 2050 net
zero carbon goal: around €100 million allocated for the reduction of direct
emissions as from the first year of the €1 billion package covering 2021 to
2030;
· The Group has increased its internal carbon prices - in place since
2016 - from €50 to €75 per ton for investment decisions and to €150 per
ton for research and development investments in disruptive technologies;
· Increase in avoided virgin raw materials: from 9.3 million tons in
2020 to 9.9 million tons in 2021;
· Reduction of 24% in non-recovered waste since 2017.
- Health, safety and diversity: care for employees and increase the gender
balance in senior management at local and Group level. Women represent 38% of
the Group Executive Committee in place since July 1, 2021, ahead of the target
of 30% in all internal senior management teams by 2025.
· Diversity: women represent almost 35% of new management hires in
2021. The objective of more than 25% of women managers was reached in 2020 and
the proportion continues to rise, with 26.3% of women managers in 2021 (25.3%
in 2020). A new target of 30% of women managers in 2025 has been set;
· Continued commitment to safety, with the accident frequency rate
(TRAR(1)) including subcontractors at 1.9 in 2021, an improvement of 15%
versus 2019;
· New healthcare policy involving all stakeholders: protecting and
promoting the health and well-being of our employees, customers, suppliers,
users of our products and solutions and local communities is the ambition of
Saint-Gobain's new healthcare policy.
- Inclusive growth and business ethics: on June 17, 2021, more than 2,300
sites organized workshops and debates as part of the International Principles
of Conduct and Action Day. Employees expressed their commitment to ethical
values and to the Group's purpose of "Making the world a better home".
· Responsible purchasing: reduce the impact of freight by developing
river transport, as for example in France in the Paris region to limit heavy
goods traffic in urban areas. In Belgium as from June 2021, Saint-Gobain also
joined forces with local partners to develop the recovery of used plasterboard
and transportation of the materials by river to Saint-Gobain sites for
recycling. Each loaded vessel can transport 400 tons of plasterboard, i.e.,
the equivalent of around 16 24-ton trucks, and can therefore replace a large
proportion of container transport by road;
1. TRAR (Total Recordable Accident Rate): accident frequency rate with
and without lost time (employees, temporary staff and on-site subcontractors).
· Inclusive growth: almost €15 million for community initiatives
(philanthropy and sponsorship); promote youth training in building (or
construction) trades, such as in Morocco with the creation of three training
centers which provide a broad spectrum of courses leading to qualifications.
Saint-Gobain in Morocco aims to build a local incubator for skilled labor to
implement more sustainable solutions;
· Shared business ethics: 95% of managers trained in our Code of Ethics
in their first year with the Group; 2021 also saw the roll-out of a
whistleblowing system accessible to employees and other stakeholders.
Our progress is recognized by independent organizations:
- CDP 2021 "A List": among only 200 A-rated companies worldwide (12,000
companies rated by CDP);
- Bloomberg 2022 Gender-Equality Index: among 418 companies recognized
worldwide for the third year running;
- 2021 Global Top Employer: among only 11 companies recognized worldwide;
local Top Employer award in 38 countries, covering 92% of employees.
To access sustainability reports, detailed results, key
figures and significant events concerning the Group, please click here:
https://www.saint-gobain.com/en/corporate-responsibility
Shareholder return policy
In 2021, Saint-Gobain returned a total of €1.2 billion to its shareholders.
The TSR of the Saint-Gobain share climbed to 69% for the year as a whole:
- Almost €700 million was paid by the Group to its shareholders in respect
of the dividend for 2020;
- Saint-Gobain Group spent €518 million buying back its shares in 2021
(net of offsetting employee share creation) in order to reduce the number of
shares outstanding to 521 million at December 31, 2021 from 530 million at
end-December 2020, ahead of its target of €2 billion in share buybacks over
five years (2021-2025).
In 2022, the Group therefore expects to return over €1.2 billion in total to
shareholders:
- At today's meeting, Saint-Gobain's Board of Directors decided to recommend
to the Shareholders' Meeting on June 2, 2022 a cash dividend up 23% to
€1.63 per share (versus €1.33 in 2020). This dividend represents 30% of
recurring net income and a dividend yield of 2.6% based on the closing share
price at December 31, 2021 (€61.87). The ex-dividend date has been set at
June 6 and the dividend will be paid on June 8, 2022;
- The Group will allocate at least €400 million for share buybacks in 2022
(net of offsetting employee share creation) - in order to further reduce the
number of its outstanding shares - in line with the objectives announced on
presenting its "Grow & Impact" plan on October 6, 2021;
- The Group will recommend to the Annual General Meeting of June 2, 2022 to
increase the maximum purchase price for its own shares, from €80 to €100
per share.
Outlook and strategic priorities
2022 outlook:
In 2022 the Group should continue to benefit from good momentum in its main
markets - especially renovation in Europe, as well as construction in the
Americas and in Asia - and reaffirm its excellent operating performance thanks
to a solid and well-aligned organization. In this environment, and provided
there is no new major impact related to the coronavirus pandemic and the
geopolitical situation, Saint-Gobain expects the following trends for its
segments:
- Europe: supportive renovation market, requiring comprehensive solutions
that increase efficiency and save time for customers, albeit with a high
comparison basis in the first half;
- Americas: upbeat market trends, particularly in residential construction
in North America and in Latin America overall, despite a less dynamic
environment in Brazil;
- Asia-Pacific: market growth with continued good momentum in China and
India, and a gradual recovery in South-East Asia with fewer pandemic-related
restrictions;
- High Performance Solutions: growth in industrial markets, with supportive
long-term trends in sustainable construction and a demand for innovation and
new materials for industry decarbonization and green mobility, despite
uncertainties as to the recovery of the automotive market in Europe.
Strategic priorities:
In this supportive environment, our strategic priorities for 2022 are fully
aligned with the medium and long-term structural growth scenario in the "Grow
& Impact" plan:
1) Accelerate the Group's growth and impact
- Outperformance versus our markets, as demonstrated by the good volume
momentum throughout 2021, thanks notably to our comprehensive range of
integrated, differentiated and innovative solutions offering sustainability
and performance for our customers, developed within the scope of an
organization as close to the ground as possible in each country or market;
- Determined deployment of our ESG initiatives in line with our 2030
roadmap towards carbon neutrality in 2050;
- Ongoing optimization of the Group's profile, with the full effect of the
Chryso integration and preparation for the GCP acquisition in the second half,
as part of a vigorous dynamic of targeted and value-creating acquisitions and
divestments.
2) Continue our initiatives focused on profitability and performance:
maintain a robust margin and strong free cash flow generation
- Constant focus on the price-cost spread, with, as in 2021, strong pricing
agility and discipline capitalizing on a significant carry-over price effect
amid inflation in raw material and energy costs of the same order of magnitude
as in 2021;
- Disciplined continuation of our operational excellence program;
- Maintaining the structural improvement in operating working capital
requirement while maintaining a good level of inventories to best serve
customers;
- Capital expenditure of around €1.8 billion, in line with the Group's
objective of between 3.5% and 4.5% of sales, with strict allocation to
high-growth markets and digital transformation.
In a structurally supportive market environment, Saint-Gobain is targeting a
further increase in operating income in 2022 compared to 2021 at constant
exchange rates.
Financial calendar
- An information meeting for analysts and investors will be held at 8:30am
(GMT+1) on February 25, 2022 and will be streamed live on Saint-Gobain's
website:
https://www.saint-gobain.com/en/news/full-year-2021-results
(https://www.saint-gobain.com/en/news/full-year-2021-results)
- Sales for the first quarter of 2022: Thursday April 28, 2022, after close of
trading on the Paris Bourse.
- First-half 2022 results: Wednesday July 27, 2022, after close of trading on
the Paris Bourse.
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 Bénédicte Debusschere +33 1 88 54 14 75
Christelle Gannage +33 1 88 54 15 49 Susanne Trabitzsch +33 1 88 54 27 96
Alix Sicaud +33 1 88 54 38 70
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.
EBITDA = operating income plus operating depreciation and amortization, less
non-operating costs.
Free cash flow = EBITDA less depreciation of right-of-use assets, plus net
financial expense, plus income tax, less capital expenditure excluding
additional capacity investments, plus change in working capital requirement.
Free cash flow conversion ratio = free cash flow divided by EBITDA, less
depreciation of right-of-use assets.
ROCE (return on capital employed) = operating income for the year adjusted
for changes in Group structure, divided by segment assets and liabilities at
year-end (see breakdown in Note 5 to the financial statements).
ESG: Environment, Social, Governance.
All indicators contained in this press release (not defined in the footnote)
are explained in the notes to the 2021 consolidated financial statements,
available by clicking here:
https://www.saint-gobain.com/en/news/full-year-2021-results
The glossary below shows the notes in which you can find an explanation of
each indicator.
Glossary:
EBITDA
Note 5
ROCE
Note 5
Net debt
Note 10
Operating
income
Note 5
Net financial
expense
Note 10
Recurring net
income
Note 5
Business
income
Note 5
Working capital
requirement
Note 5
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 Universal Registration Document
available on its 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) .
Click on, or paste the following link into your web browser, to view the
associated PDF document.
http://www.rns-pdf.londonstockexchange.com/rns/7742C_1-2022-2-24.pdf
(http://www.rns-pdf.londonstockexchange.com/rns/7742C_1-2022-2-24.pdf)
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 FR EAXALAEKAEFARecent news on Compagnie de Saint Gobain SA
See all newsREG - Compagnie St-Gobain - Agreement
AnnouncementREG - Compagnie St-Gobain - 1st Quarter Results
AnnouncementREG - Compagnie St-Gobain - Acquisition
AnnouncementREG - Compagnie St-Gobain - Issue of Debt
AnnouncementREG - Compagnie St-Gobain - Very low carbon siding production in the US
Announcement