Saint-Gobain – Sales for the First Nine Months of 2009
- 15.0% on a reported basis;
- 14.5% like-for-like
SALES FOR THIRD-QUARTER 2009:
- 13.9% on a reported basis;
- 12.7% like-for-like
Saint-Gobain’s consolidated sales for the first nine months of 2009 came
in at
This represents a decline of 15.0% on a reported basis and of 14.5%
like-for-like (constant Group structure and exchange rates).
Changes in Group structure over the first nine months of the year
resulted in a 1.0% increase in sales. This was more than offset by the 1.5%
negative currency effect resulting chiefly from the slide in the pound
sterling and Brazilian real.
On a like-for-like basis, consolidated sales contracted by 14.5% over the
nine months to
(up 1.2%) despite a 15.7% drop in volumes.
In the third quarter, consolidated sales came in at
versus
of 13.9%. Organic growth stood at -12.7% (reflecting a 0.2% price increase
and a negative 12.9% volume effect), following negative organic growth of
15.9% in the second quarter and 14.9% in the three months to
After extremely tough conditions in all of the Group’s markets and
geographic areas over the first half of the year, third-quarter figures show
a relative improvement. However, although the overall climate is no longer
deteriorating, economic conditions remain very depressed in most of the
Group’s markets and signs of recovery are weak for the time being. Only
America
organic growth of close to 9% between the second and third quarters) and
appear to have put the crisis behind them. In contrast, while business
appears to be broadly stabilizing in both western and eastern
as
automotive), trading remains at a low level in both housing and industrial
markets. Household consumption continued to hold firm in all areas where the
Group has operations.
All of the Group’s Business Sectors and divisions except Packaging
continued to report sharp declines in sales volumes over the nine-month
period, although the pace of decline slowed compared with the first half.
With the exception of Flat Glass, sales prices remained upbeat across all
Sectors and divisions. The Group therefore continued to benefit from a
positive spread with respect to raw materials and energy costs. As expected,
the increase in prices was smaller than in first-half 2009, due mainly to the
high basis for comparison (3.8% price increase in third-quarter 2008).
The table below presents sales trends by Sector and major geographic area
over the first nine months of 2009. Figures for the same period in 2008 are
provided for comparison purposes.
Sales for Sales for % change % change % change
the first the first on a on a on a
nine months nine months reported comparable like-for-
of 2008 of 2009 basis structure like
(EUR million) (EUR million) basis basis
BY SECTOR
Innovative
Materials(1) 7,449 5,755 -22.7% -21.6% -20.6%
Flat Glass 4,278 3,358 -21.5% -21.5% -18.1%
High-Performance
Materials 3,193 2,412 -24.5% -21.9% -24.1%
Construction
Products(1) 9,211 7,987 -13.3% -15.3% -14.9%
Interior Solutions 4,724 3,809 -19.4% -20.3% -18.7%
Exterior Solutions 4,512 4,204 -6.8% -9.9% -10.9%
Building
Distribution 15,051 12,816 -14.8% -16.3% -13.5%
Packaging 2,628 2,620 -0.3% -1.6% -3.4%
Internal sales
and other (904) (743) - - -
GROUP 33,435 28,435 -15.0% -16.0% -14.5%
BY GEOGRAPHIC AREA
France 9,910 8,622 -13.0% -13.1% -13.1%
Other western
European countries 15,364 12,446 -19.0% -20.4% -17.3%
North America 4,179 3,808 -8.9% -7.0% -15.9%
Emerging countries
and Asia-Pacific 5,611 4,672 -16.7% -19.7% -12.9%
Internal sales (1,629) (1,113) - - -
GROUP 33,435 28,435 -15.0% -16.0% -14.5%
(1) Including inter-division eliminations.
Like-for-like performance of Business Sectors
- Innovative Materials sales declined 20.6% over the first nine months of
the year and 17.4% in the third quarter (versus -22.8% in the second
quarter). The relative quarter-on-quarter improvement is mainly
attributable to Flat Glass.
- Flat Glass sales fell 18.1% over the nine-month period and 13.1% in
the third quarter (versus a 20.0% drop in the three months to June
30). The relative improvement in the third quarter was driven by a
smaller decline in sales volumes across all divisions in Asia and
Latin America as well as for automotive glass in Europe. Despite a
sharp 44% recovery since the beginning of June, average prices for
commodity products (float glass) in the first nine months of
the year and in the third quarter were respectively 37% and
29% down compared with the same prior-year periods. Prices for
construction glass and for the Flat Glass Sector as a whole also
remained weaker than in 2008.
- High-Performance Materials (HPM) sales contracted by 24.1% over the
nine months to September 30, 2009, in line with the 24.7% fall over
the first six months of the year. Trading stabilized at a subdued
level during the third quarter, with sales retreating 22.9%. The
downward momentum in Industrial Ceramics picked up pace, particularly
in the Refractories division linked to the investment cycle. However,
this was offset in the same quarter by a relative improvement in
Abrasives and High-Performance Plastics businesses, which are more
directly related to industrial production.
- Construction Products (CP) sales dropped 14.9% over the first nine
months of the year and 14.3% in the third quarter. The pace of decline
slowed slightly compared with the 16.2% drop in the three months to
June 30. In the third quarter, the decline in sales volumes slowed
across the entire Sector, while sales price increases narrowed slightly
versus third-quarter 2008, which represents a very high basis for
comparison (sales prices up 7.2%).
- Interior Solutions posted an 18.7% fall in like-for-like sales over
the nine-month period. The relative improvement (mainly in volumes)
in third-quarter figures compared with the three months to June 30,
2009 (down 16.9% versus 21.0% in the second quarter) reflects the
start of a more favorable basis for comparison - particularly in the
US and UK - as well as growth gains in Brazil. Sales prices edged
down slightly during the quarter.
- Exterior Solutions sales retreated 10.9% over the first nine months
of the year, a slightly lower drop than the 11.6% decline reported
in the second quarter. This reflects the smaller drop in sales
volumes in the three months to September 30 in Western Europe as well
as the US and Asia. However, the upward trend in sales prices lost
momentum, in light of the very high comparative third-quarter 2008
period.
- Building Distribution posted a 13.5% drop in sales over the nine months
to September 30, 2009 although there was a relative improvement in the
third quarter, with sales declining 11.5% versus 14.9% in the three
months to June 30. Despite being still sharply down on 2008 figures,
the UK and Spain began to benefit from a more favorable basis for
comparison in the third quarter, while sales in Germany stabilized at
a low level. The pace of decline in the United States and most other
European countries flagged slightly. In contrast, trading remained
sluggish in Eastern Europe.
- Packaging continued to report upbeat trading conditions, with reported
sales almost stable compared with the first nine months of 2008.
However, like-for-like sales edged down 3.4%, as the robust momentum in
sales prices failed to fully offset the 5.7% drop in volumes.
Like-for-like analysis by geographic area
Most of the geographic areas where the Group operates were strongly
affected by the economic crisis throughout the first nine months of 2009.
However, the downward trend in sales slowed during the third quarter in
and
Like-for-like trends for the third quarter are described below.
- In France, business contracted at a slightly slower pace over the three
months to September 30, 2009 (down 12.5% compared with 13.6% in the
second quarter), due chiefly to the relative improvement in Flat Glass
sales.
- This improving trend was even more noticeable in other western European
countries, where sales fell 12.9% in the third quarter versus 19.8% in
the second. The slowing pace of decline was observed across all regions
and particularly the United Kingdom and Spain, which began to benefit
from a more favorable basis for comparison. Germany continued to show
greater resilience.
- In North America, the pace of the downturn steadied, with sales
retreating 17.2% in the third quarter versus 17.3% in the three months
to June 30. The relative improvement in sales volumes was offset by
smaller sales price increases, which compared unfavorably with
third-quarter 2008 (prices up 10.5%).
- In emerging countries and Asia, the decline slowed markedly, with sales
down 11.7% compared with 13.3% in the second quarter. This improved
performance was fuelled mainly by a sharp pick-up in trading between
the second and third quarters in Asia and Latin America (organic growth
of close to 9%). The trading environment in eastern European economies
remained in the doldrums.
Update on asbestos claims in
Some 3,000 claims were filed against CertainTeed in the first nine months
of 2009, compared with 4,000 claims in the year-earlier period. Taking into
account around 5,000 claims settled or transferred to inactive dockets in the
nine-month period, the total number of outstanding claims continued to fall,
to around 66,000 at
2008
Outlook
Although third-quarter figures were still significantly below the same
period in 2008 (down 12.7% like-for-like), the downward spiral has slowed
compared with the second quarter of 2009, when the like-for-like decline came
in at 15.9%.
This relative improvement should gain momentum in the fourth quarter,
thanks mainly to a much more favorable basis for comparison.
The Group will also benefit throughout the second half of the year from
an acceleration in the cost cutting program introduced and extended since the
onset of the crisis. It will also continue to enjoy a positive price/cost
spread, with a slightly greater fall in the cost of raw materials and energy
than in the first half.
The Group can therefore confirm that operating income and recurring net
income for second-half 2009 will outperform first-half figures.
Amid a persistently challenging economic backdrop, the Group continues to
optimize cash flow generation on the back of strong free cash flow, a
million
tight rein on working capital requirements (WCR).
Forthcoming results announcements
– Results for 2009:
Bourse.
Analyst/Investor relations
Florence Triou-Teixeira +33-1-47-62-45-19
Etienne Humbert +33-1-47-62-30-49
Vivien Dardel +33-1-47-62-44-29
Press relations
Sophie Chevallon +33-1-47-62-30-48
SOURCE Saint-Gobain