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Saint-Gobain: First-half 2011: Robust Organic Growth; Strong Growth in Earnings

July 28, 2011

PARIS, July 28, 2011 /PRNewswire/ –

Publication of first half 2011 results.

        KEY FIGURES
        (EURm)                    H1-2010      H1-2011      Change
        Sales                      19,529       20,875       +6.9%
        Operating income            1,445        1,720      +19.0%
        Recurring(1) net income       580          902      +55.5%
        Net income                    501          768      +53.3%

Highlights of first-half 2011:

        - Organic growth: up 6.7% over the first half.
        - Sales prices: up 2.4% over the first half (up 2.0% in the first
          quarter; up 2.8% in the second quarter).
        - Double-digit growth in operating income (at constant exchange
          rates*): up 18.6%.
        - Free cash flowsquared: up 7.0% to EUR1.1bn, against a target of
          EUR1.3bn for the full year.
        - Continued strong balance sheet: net debt/EBITDA ratio cut to 1.8
          from 2.1 at end-June 2010.
        - Relaunch of capital spending (up 48.4% to EUR641m) and
          acquisitions (up from EUR36m to EUR182m).

Pierre-Andre de Chalendar, Chairman and Chief Executive Officer of
Saint-Gobain, commented:

“Saint-Gobain’s strong sales growth in the first half of the year
confirmed the recovery in sales volumes observed in 2010 and our successful
focus on sales prices. Based on significantly lower costs, this performance
helped drive a double-digit rise in our earnings and curb the impact of
soaring raw material and energy costs.

We expect the underlying trends observed since the beginning of the year
to continue in the six months to December 31. Leveraging our strong balance
sheet, we will continue to adopt a resolute, tempered development strategy.
Capital expenditure and acquisitions will be stepped up and focused
primarily on our three priorities: Asia and emerging countries, high
value-added solutions for the Habitat market, and bolt-on and consolidating
acquisitions in Building Distribution and Construction Products, following
the example of the Build Center and Brossette acquisitions unveiled early
this week.

Overall for the year as a whole,we are confident about our ability to
achieve our 2011 targets of robust organic growth and a double-digit rise in
operating income (at constant exchange rates**). We also confirm ourfree
cash flow target of EUR1.3 billion, after a EUR500 million increase in our
capital expenditure.”

1. Excluding capital gains and losses on disposals, asset write-downs
and material non-recurring provisions.

2. Excluding the tax effect of capital gains and losses on disposals,
asset write-downs and material non-recurring provisions.

* Exchange rates for first-half 2010.

** Exchange rates for 2010.

Operating performance

The second quarter of 2011 confirmed the underlying trends seen in the
three months to March 31 (excluding the very positive impact of mild winter
weather and the number of working days which boosted volumes in the first
quarter). Organic growth for the Group came in at 4.4%, with contributions
from all of the Group’s business sectors and main geographic regions. This
performance continued to be powered by vigorous momentum in emerging
countries and brisk trading in industrial markets,and confirms the gradual
improvement in businesses linked to the residential construction sector in
Europe. High value-added solutions and especially businesses related to
energy efficiency in the Habitat market (Insulation, Reinforced Thermal
Insulation Glass, Industrial Mortars, etc.) continued to spearhead the
Group’s organic growth on residential construction markets in Europe, buoyed
by new energy performance standards and particularly Thermal Regulation “RT
2012″ in France. The growth push in these sectors continues to be driven by
the Group’s largest national markets (France, Germany and Scandinavia), with
the exception of the UK where sales volumes slowed during the second
quarter.

Businesses related to household consumption (Packaging sector: Verallia)
continued to perform well.

Barring the renovation segment (Exterior Products), which saw growth
pick up pace over the last few months due to severe storms, construction
markets in North Americaremained in the doldrums.

With market conditions for the Group improving on the whole and raw
material and energy costs soaring, sales prices remaineda key focus for the
Group throughout the first half, climbing 2.4% over the period, including
2.8% in the second quarter alone (after 2.0% in the three months to March
31).

Overall in the first six months of 2011, the Group posted 6.7% organic
growth (positive volume and price impacts of 4.3% and 2.4%, respectively).
However, trading levels were still well below their pre-crisis levels of
first-half 2008 (12.6% lower in volume terms).

Bolstered by the cost savings achieved over the last few years, the
Group’s operating margin rose sharply,up to 8.2% from 7.4% in first-half
2010. Each key geographical area contributed to margin growth except North
America, where profitability in the comparative first-half 2010 period had
been boosted by stockpiling by building materials distributors who are Group
customers.

1degree(s)) Performance of Group Business Sectors

All business sectors reported robust organic growth in the first half of
2011. Profitability improved in Innovative Materials and Building
Distribution, but dipped slightly in Construction Products and Packaging
(Verallia), squeezed by the hike in raw material and energy costs. For these
two sectors, the acceleration in sales price increases throughout the first
half failed to compensate fully for cost inflation.

Innovative Materials continuedto enjoy the bullish trading observed in
2010 and once again delivered the Group’s best organic growth performance,
both in the first half (up 8.5%) and in the three months to June 30 (up
5.5%). The contribution from the sector’s different divisions was roughly
equal. Markets related to industrial output and capital spending remained
upbeat across all regions, and particularly Asia and emerging countries.
Innovative Materials also benefited from an upturn in residential
construction markets across Europe during the first half. Combined with a
significantly leaner cost base thanks to the cost savings achieved in the
past few years, this drove further advances in the business sector’s
operating margin, which rose to 12.5% from10.4% in first-half 2010.

        - Flat Glass reported 8.2% organic growth over the period,
          including 5.8% in the second quarter, spurred chiefly by volume advances
          in Asia and emerging countries as well as Western Europe (France in
          particular). Volume growth in Western Europe reflects the gradual
          recovery in residential construction markets across the region. In an
          attempt to curb the impact of rising raw material and energy costs,
          sales prices continued to rise over the first half, with increases
          picking up pace between the first and second quarters. The operating
          margin climbed sharply, up to 9.5% of sales from 7.8% of sales in the
          same year-ago period.

        - High-Performance Materials (HPM) delivered a further 9.3%
          rise in like-for-like sales (up 5.5% in the second quarter). Industrial
          output and capital spending remained upbeat across all regions, and
          particularly Western Europe. To keep up with spiraling raw material and
          energy costs, sales prices were up significantly over the period, with
          price increases across the sector also picking up pace between the first
          and second quarters. Although HPM volumes are not as yet back to their
          pre-crisis levels of first-half 2008, very strong operating leverage
          sent the operating margin well above its record first-half 2008 showing
          (13.9%), at 16.4% of sales versus 13.5% of sales in first-half 2010.

Construction Products (CP)like-for-like sales climbed 4.9% over the
first half (3.7% in the second quarter), buoyed by the rebound in sales
volumes across all divisions except Pipe and Interior Solutions in the US.
The business sector’soperating margin edged down to 9.7% from 10.1% in
first-half 2010. This reflects narrower margins in Exterior Solutions, due
chiefly to the hike in raw material and energy costs. The upward momentum in
sales prices over the six months to June 30 (up 2.8% for the business sector
as a whole and 2.7% for Exterior Solutions) failed to fully offset this cost
inflation.

        - After an excellent first quarter, Interior Solutions posted
          robust 6.0% organic growth over the first half and more moderate 3.9%
          growth in the three months to June 30. The sharp recovery in sales
          volumes over both periods in most Western European countries
          (particularly in Insulation), along with ongoing vibrant trading in Asia
          and emerging countries, more than offset the continuing slowdown in
          North America. Sales price increases (up 3.0% over the first half and
          3.2% in the second quarter) - especially in the Insulation business,
          helped offset the spike in energy and raw material costs. Volume growth
          led to further advances in the operating margin, up to 7.9% versus 6.8%
          in first-half 2010.

        - Like-for-like Exterior Solutions sales climbed 4.1% over the
          first half and 3.9% in the second quarter. This improvement reflects a
          very mixed performance from its different divisions. Industrial Mortars
          delivered double-digit organic growth in the six months to June 30,
          powered by bullish conditions in Asia and emerging countries, but Pipe
          volumes were down sharply, hit by austerity measures in most European
          countries and a decline in export sales. Exterior Products benefited
          from a sharp upturn in the US renovation market in the second quarter,
          on the back of severe storms over the past few months. Despite an
          acceleration in sales price increases in the three months to June 30 (up
          3.4% after a 1.8% rise in the first quarter), the operating margin
          narrowed to 11.1% from 13.0% in first-half 2010, squeezed mainly by the
          sharp downturn in the Pipe business sector and soaring raw material and
          energy costs.

Building Distribution rebounded strongly over the first half, posting
7.3%organic growth(of which 4.5% in the second quarter), spurred by a strong
rise in sales volumes in France, Germany, the Netherlands and Scandinavia
during the first six months of the year. In contrast, trading was more
uneven in the UK and Eastern Europe, and remains very tough in southern
Europe. The overall trading upturn, combined with sharp cost reductions over
the past few years, led to a strong rise in the operating margin, up to 3.6%
from 2.4%.

Packaging (Verallia) reported 4.2% organic growthover the first half,
driven by improved conditions in Western Europe and buoyant trading in Latin
America. Despite the negative currency impact due mainly to the fall in the
US dollar against the euro, EBITDA climbed to EUR347 million from EUR344
million in the same period in 2010, in line with Verallia’s target for the
full year. This performance reflects Verallia’s ability to pass on most of
the steep rise in its costs (mainly energy and raw materials) to prices,
which gained 2.6%. The EBITDA margin dipped to 19.1% from 19.5% one year
earlier, reflecting the time lag before the full impact of the sales price
rises kicks in.

Taking the opportunity of the release of Saint-Gobain’s first-half
results, Verallia’s registration document (document de base) was updated
with the French financial markets authority (AMF) on July 28, 2011.

2degree(s)) Analysis by geographic area

As in the first quarter, all of the Group’s regions delivered strong
organic growth over the six months to June 30, 2011. Profitability improved
sharply in Western Europe, Asia and emerging countries, but edged down
slightly in North America.

        - In France and other Western European countries, organic
          growth for the first half came in at 6.2% and 6.3%, respectively (3.9%
          and 3.2%, respectively, in the second quarter). During the second
          quarter, the rebound observed in businesses related to residential
          construction over the three months to March 31 continued apace,
          particularly in Building Distribution and Interior Solutions, despite a
          slowdown in the UK and persistent difficulties in southern Europe.
          Businesses related to industrial markets remained buoyant. As a result,
          the operating margin climbed sharply in both France and other Western
          European countries, to 7.2% and 6.2%, respectively (6.2% and 5.1%,
          respectively, in first-half 2010).

        - North Americareported 3.9% organic growth over both the
          first half and the second quarter. This was essentially driven by fresh
          advances in High-Performance Materials and rising volumes in Exterior
          Products. The operating margin continued to perform very well,despite
          narrowing to 11.2% (compared to 12.0% in first-half 2010, which had
          benefited from stockpiling by building materials distributors).

        - Asia and emerging countries once againdelivered the Group's
          strongest organic growth performance, both in the first half and over
          the second quarter (up 12.4% and 9.7%, respectively). This strong
          momentum was seen across all regions, and particularly Eastern Europe.
          The operating margin continued on an upward trend, at 10.1% of sales
          versus 9.1% one year earlier.

Analysis of the interim consolidated financial statements for first-half
2011

The interim consolidated financial statements set out below were
authorized for issue by the Board of Directors on July 28, 2011:

                                                         H1 2010 H1 2011 % change
                                                         EURm    EURm
        Sales and ancillary revenue                       19,529  20,875    +6.9%
        Operating income                                   1,445   1,720   +19.0%
        EBITDA (op. inc. + operating
        depreciation/amortization)                         2,220   2,479   +11.7%
        Non-operating costs                                 (193)   (150)  -22.3%
        Capital gains and losses on disposals, asset
        write-downs, corporate acquisition fees and
        earn-out payments                                    (51)   (114) +123.5%
        Business income                                    1,201   1,456   +21.2%
        Net financial expense                               (387)   (298)  -23.0%
        Income tax                                          (279)   (352)  +26.2%
        Share in net income of associates                      3       4   +33.3%
        Income before minority interests                     538     810   +50.6%
        Minority interests                                   (37)    (42)  +13.5%
        Recurring[1] net income                              580     902   +55.5%
        Recurring[1] earnings per share[2] (in EUR)         1.09    1.68   +54.1%
        Net income                                           501     768   +53.3%
        Earnings per share[2] (in EUR)                      0.94    1.43   +52.1%
        Operating depreciation and amortization              775     759    -2.1%
        Cash flow from operations[3]                       1,431   1,721   +20.3%
        Cash flow from operations excluding capital
        gains tax[4]                                       1,419   1,697   +19.6%
        Capital expenditure                                  432     641   +48.4%
        Free cash flow (excluding capital gains tax)[4]      987   1,056    +7.0%
        Investments in securities                             36     182  +405.6%
        Net debt                                           9,081   9,055    -0.3%

1 Excluding capital gains and losses on disposals, asset write-downs and
material non-recurring provisions.

2 Calculated based on the number of shares outstanding at June 30
(535,334,213 shares in 2011 versus 530,786,373 shares in 2010). Based on the
weighted average number of shares outstanding (526,306,335 shares in
first-half 2011 versus 509,735,208 shares in first-half 2010), recurring
earnings per share comes out at EUR1.71 (versus EUR1.14 in first-half 2010),
and earnings per share comes out at EUR1.46 (versus EUR0.98 in first-half
2010).

3 Excluding material non-recurring provisions.

4 Excluding the tax effect of capital gains and losses on disposals,
asset write-downs and material non-recurring provisions.

Sales advanced 6.9%. Exchange rate fluctuations had a minimal 0.2%
positive impact, with gains in Scandinavian currencies and most currencies
of the Group’s main emerging countries against the euro almost fully offset
by the decline in the US dollar. The impact of changes in Group structure
was neutral over the period, with the sale of Advanced Ceramics at December
31, 2010 fully offsetting sales contributions from acquisitions over the
past 12 months.

Sales therefore climbed 6.7% on both a constant exchange rate basis* and
like-for-like (constant exchange rates and Group structure). Volumes were up
4.3%, while sales prices gained 2.4%.

Thanks to sweeping cost cuts over the last three years, operating income
benefited fully from the growth in sales, surging 19.0%, or 18.6% at
constant exchange rates*. The operating margin thereforeimproved
significantly, up to 8.2% of sales (11.3%excluding Building Distribution),
versus 7.4% of sales (10.7% excluding Building Distribution) in first-half
2010.

EBITDA (operating income + operating depreciation and amortization
)advanced 11.7%. The consolidated EBITDA margin came in at 11.9% of sales
(16.4% excluding Building Distribution), up from 11.4% (16.2% excluding
Building Distribution) in the six months to June 30, 2010.

Non-operating costs declined 22.3% from EUR193 million in first-half
2010 to EUR150 million in first-half 2011 on the back of lower restructuring
costs. This amount includes a EUR48.5 million accrual to the provision for
asbestos litigation involving CertainTeed in the US (half of the 2010
accrual).

The net balance of capital gains and losses, asset write-downs and
corporate acquisition feeswas a negative EUR114 million. This amount
comprises EUR21 million in net gains on asset disposals and EUR128 million
in asset write-downs. Most write-downs relate to restructuring plans and
plant closures in progress and chiefly concern certain Building Distribution
businesses in Europe (mostly southern Europe) and Construction Products
businesses in the US (write-down of property, plant and equipment at
mothballed sites where production is no longer considered likely to resume
in the short term).

Business incomejumped 21.2% to EUR1,456 million after taking into
account the items mentioned above (non-operating costs, capital gains/losses
on disposals and asset write-downs).

Net financial expense fell EUR89 million, or 23.0%, to EUR298 million
from EUR387 million in the same year-ago period, powered chiefly by the fall
in average net debt over the period and the decrease in net interest costs
on pensions (higher returns on plan assets). The average cost of net debt in
first-half 2011 came out at 5.6%, as for full-year 2010.

Income tax was up 26.2%, from EUR279 million to EUR352 million,
reflecting the rise in pre-tax income. The income tax rate on recurring net
income came out at 28% versus 32% in the six months to June 30, 2010.

Recurring net income (excluding capital gains and losses, exceptional
asset write-downs and material non-recurring provisions) amounted to EUR902
million, soaring 55.5% year-on-year. Based on the number of shares
outstanding at June 30, 2011 (535,334,213 shares versus 530,786,373 shares
at June 30, 2010), recurring earnings per share came out at EUR1.68, a rise
of 54.1% on first-half 2010 (EUR1.09).

Net incomecame in at EUR768 million, up 53.3% on first-half 2010. Based
on the number of shares outstanding at June 30, 2011 (535,334,213 shares
versus 530,786,373 shares at June 30, 2010), earnings per share came out at
EUR1.43, up 52.1% on first half 2010 (EUR0.94).

Following the relaunch of the investment strategy announced at the start
of 2011,capital expenditure jumped 48.4% toEUR641 million (EUR432 million in
first-half 2010), and accounted for 3.1% of sales (2.2% in first-half 2010).
Half of these investments relate to growth capex, focused chiefly on
selective growth projects in Asia and emerging countries and activities
related to energy efficiency (Flat Glass – including solar power – and
Construction Products).

Cash flow from operations rose 20.3% year-on-year to EUR1,721 million.
Before the tax impact of capital gains and losses on disposals and asset
write-downs, free cash flow rose 19.6% to EUR1,697 million, from EUR1,419
million in the six months to June 30, 2010.

* Based on average exchange rates for first-half 2010.

Despite the sharp rise in capital expenditure:

– free cash flow (cash flow from operations less capital expenditure
)rose 8.0% to EUR1,079 million. Before the tax impact of capital gains and
losses and asset write-downs, free cash flow moved up 7.0% to EUR1,056
million, at 5.1% of sales (as in first-half 2010). More than 80% of the
Group’s full-year EUR1.3 billion free cash flow target has therefore already
been met in the first half.

– the difference between EBITDA and capital expenditure was up 2.8%, to
EUR1,838 million in first-half 2011 (from EUR1,788 million in first-half
2010), representing 8.8% of sales (9.2% in the same year-ago period).

After eight years of continuous improvements, operating working capital
requirementsinched up 1.1 day to 46.6 days’ sales at June 30, 2011, to stand
in between operating WCR at June 30, 2010 (45.5 days) and at June 30, 2009
(47.2 days). This trend chiefly reflects the upturn in trading and increase
in raw material inventories amid spiraling raw material costs over the first
half of 2011.

Consistent with the relaunch of the Group’s acquisitions strategy
announced at the start of 2011, and in parallel with the rise in capital
spending, investments in securitieswere up sharply at EUR182 million,a
five-fold increase on first-half 2010(EUR36 million). In all, 85% of these
investments (EUR154 million) related to acquisitions in Asia and emerging
countries.

Net debt remained stable year-on-year, at EUR9.1 billion, with all of
the cash flow generated over the past 12 months (net of changes in operating
WCR) used to relaunch capital spending and acquisitions projects and to pay
dividends (2009 dividend paid in July 2010 on top of the 2010 dividend paid
in June 2011 for a total of EUR746 million) and share buy-backs. Net debt
came out at 50% of shareholders’ equity, versus 51% at June 30, 2010. The
net debt to EBITDA ratio came out at 1.8 versus 2.1 at end-June 2010.

Update on asbestos claims in the US

Some 2,000 claims were filed against CertainTeed in the first six months
of 2011, on a par with first-half 2010. A total of 4,000 claims were settled
during the period (2,000 in first-half 2010), bringing the total number of
outstanding claims to 54,000 at June 30, 2011, compared with 56,000 at
December 31, 2010.

A total of US$ 96 million in indemnity payments were paid in the US over
the year to June 30, 2011, compared with US$ 103 million in the year to
December 31, 2010.

Outlook and objectives for full-year 2011

After a very encouraging first half, the Group expects the conditions
observed on its various markets since the beginning of the year to continue
apace:

        - growth should remain vigorous in Asia and emerging
          countries;

        - industrial markets should remain upbeat in North America,
          while construction markets are likely to remain fairly sluggish;

        - industrial markets should continue to perform well in
          Western Europe, while the residential sector (new-builds and
          renovations) is expected to continue on an upward trend. Trading is
          expected to remain upbeat in France, Scandinavia and Germany;

        - household consumption markets should hold firm across all
          regions.

Against this backdrop, all of the Group’s business sectors should
continue to benefit from a positive growth momentum, despite a higher basis
for comparison in the second half.

To drive growth in its different businesses, Saint-Gobain will therefore
continue to:

– pursueits resolute and tempered development strategy,underpinned by
strict financial discipline. It will step up capital spending and
acquisitions, focusing on the Group’s main growth drivers (emerging
countries, energy efficiency and solar power – which should account for more
than 80% of growth capex in 2011 as a whole – as well as consolidation in
Building Distribution and Construction Products business sectors). Along
these lines, early this week the Group announced its acquisition of
Brossette and of the Build Center network in the UK;

– leverage its price-focused policy and endeavor to pass on the rise in
raw material and energy costs through sales price increases, particularly
amid rising inflation;

– maintain a tight rein on costs;

– keep a close watch on cash management and on maintaining a strong
balance sheet;

– maintain R&D efforts.

Consequently, Saint-Gobain is confident about its ability to achieve its
full-year 2011 targets:

– robust organic growth;

– double-digit growth in operating income (at constant exchange rates*),
despite the rise in raw material and energy costs;

– EUR1.3 billion in free cash flow, after a EUR500 million increase in
capital expenditure;

– a persistently strong balance sheet.

* average exchange rates for 2010.

Forthcoming results announcement

– Sales for the first nine months of 2011: October 25, 2011, after close
of trading on the Paris Bourse.

* * *

        Appendix 1: Results by business sector and
        geographic area
                                                   Change on Change on  Change on
                                              H1                 a          a
        I. SALES                   H1 2010   2011 an actual comparable comparable
                                   (in EUR   (in   structure structure  structure
                                     m)     EUR m)   basis     basis       and
                                                                         currency
                                                                          basis
        By sector and division:
        Innovative Materials (1)    4,535   4,827    +6.4%     +8.4%      +8.5%
        Flat Glass                  2,537   2,764    +9.0%     +8.9%      +8.2%
        High-Performance
        Materials                   2,010   2,082    +3.6%     +8.0%      +9.3%
        Construction Products (1)   5,422   5,713    +5.4%     +4.5%      +4.9%
        Interior Solutions          2,535   2,721    +7.3%     +6.3%      +6.0%
        Exterior Solutions          2,903   3,017    +3.9%     +3.3%      +4.1%
        Building Distribution       8,322   9,043    +8.7%     +8.4%      +7.3%
        Packaging (Verallia)        1,760   1,818    +3.3%     +2.4%      +4.2%
        Internal sales and misc.     -510    -526     n.m.      n.m.       n.m.
        Group Total                19,529  20,875    +6.9%     +6.9%      +6.7%
        (1) including intra-sector
        eliminations
        By geographic area:
        France                      5,786   6,138    +6.1%     +6.2%      +6.2%
        Other Western European
        countries                   8,161   8,828    +8.2%     +8.0%      +6.3%
        North America               2,846   2,772    -2.6%     -1.3%      +3.9%
        Emerging countries and
        Asia                        3,631   4,149   +14.2%    +13.7%     +12.4%
        Internal sales               -895  -1,012     n.m.      n.m.       n.m.
        Group Total                19,529  20,875    +6.9%     +6.9%      +6.7%
                                              H1
                                   H1 2010   2011             H1 2010    H1 2011
                                   (in EUR   (in              (in % of   (in % of
                                     m)     EUR m) Change on   sales)     sales)
        II. OPERATING INCOME                       an actual
                                                     structure basis
        By sector and division:
        Innovative Materials         471     602    +27.8%     10.4%      12.5%
        Flat Glass                   199     261    +31.2%      7.8%       9.5%
        High-Performance
        Materials                    272     341    +25.4%     13.5%      16.4%
        Construction Products        549     552     +0.5%     10.1%       9.7%
        Interior Solutions           173     216    +24.9%      6.8%       7.9%
        Exterior Solutions           376     336    -10.6%     13.0%      11.1%
        Building Distribution        197     327    +66.0%      2.4%       3.6%
        Packaging (Verallia)         227     226     -0.4%     12.9%      12.4%
        Miscellaneous                 1       13     n.m.       n.m.       n.m.
        Group Total                 1,445   1,720   +19.0%      7.4%       8.2%
        By geographic area:
        France                       358     442    +23.5%      6.2%       7.2%
        Other Western European
        countries                    415     551    +32.8%      5.1%       6.2%
        North America                342     310     -9.4%     12.0%      11.2%
        Emerging countries and
        Asia                         330     417    +26.4%      9.1%      10.1%
        Group Total                 1,445   1,720   +19.0%      7.4%       8.2%
                                              H1
                                   H1 2010   2011             H1 2010    H1 2011
                                   (in EUR   (in              (in % of   (in % of
                                     m)     EUR m) Change on   sales)     sales)
        III. BUSINESS INCOME                       an actual
                                                     structure basis
        By sector and division:
        Innovative Materials         382     475    +24.3%      8.4%       9.8%
        Flat Glass                   153     189    +23.5%      6.0%       6.8%
        High-Performance
        Materials                    229     286    +24.9%     11.4%      13.7%
        Construction Products        483     504     +4.3%      8.9%       8.8%
        Interior Solutions           122     195    +59.8%      4.8%       7.2%
        Exterior Solutions           361     309    -14.4%     12.4%      10.2%
        Building Distribution        160     267    +66.9%      1.9%       3.0%
        Packaging (Verallia)         217     220     +1.4%     12.3%      12.1%
        Miscellaneous              -41(a)   -10(a)   n.m.       n.m.       n.m.
        Group Total                 1,201   1,456   +21.2%      6.1%       7.0%
        By geographic area:
        France                       310     418    +34.8%      5.4%       6.8%
        Other Western European
        countries                    336     432    +28.6%      4.1%       4.9%
        North America              257(a)   208(a)  -19.1%      9.0%       7.5%
        Emerging countries and
        Asia                         298     398    +33.6%      8.2%       9.6%
        Group Total                 1,201   1,456   +21.2%      6.1%       7.0%
        (a) after asbestos-related charge (before tax) of EUR37.5m in H1 2010
        and EUR48.5m in H1 2011
                                              H1
                                   H1 2010   2011             H1 2010    H1 2011
                                   (in EUR   (in              (in % of  (in % of
                                     m)     EUR m) Change on   sales)     sales)
        IV. CASH FLOW                              an actual
                                                   structure basis
        By sector and division:
        Innovative Materials         463     600    +29.6%     10.2%      12.4%
        Flat Glass                   235     285    +21.3%      9.3%      10.3%
        High-Performance
        Materials                    228     315    +38.2%     11.3%      15.1%
        Construction Products        403     424     +5.2%      7.4%       7.4%
        Building Distribution        149     252    +69.1%      1.8%       2.8%
        Packaging (Verallia)         250     261     +4.4%     14.2%      14.4%
        Miscellaneous                166(a)  184(a)   n.m.      n.m.       n.m.
        Group Total                1,431   1,721    +20.3%      7.3%       8.2%
        By geographic area:
        France                       229     333    +45.4%      4.0%       5.4%
        Other Western European
        countries                    500     645    +29.0%      6.1%       7.3%
        North America                290(a)  291(a)  +0.3%     10.2%      10.5%
        Emerging countries and
        Asia                         412     452     +9.7%     11.3%      10.9%
        Group Total                1,431   1,721    +20.3%      7.3%       8.2%
        (a) after asbestos-related charge (after tax) of EUR23m in H1 2010
        and EUR30m in H1 2011
                                              H1
                                   H1 2010   2011             H1 2010    H1 2011
                                   (in EUR   (in              (in % of   (in % of
                                     m)     EUR m) Change on   sales)     sales)
        V. CAPITAL EXPENDITURE                     an actual
                                                     structure basis
        By sector and division:
        Innovative Materials         151     323    +113.9%     3.3%       6.7%
        Flat Glass                   116     251    +116.4%     4.6%       9.1%
        High-Performance
        Materials                     35      72    +105.7%     1.7%       3.5%
        Construction Products         97     147     +51.5%     1.8%       2.6%
        Interior Solutions            43      88    +104.7%     1.7%       3.2%
        Exterior Solutions            54      59      +9.3%     1.9%       2.0%
        Building Distribution         63      69      +9.5%     0.8%       0.8%
        Packaging (Verallia)         114      92     -19.3%     6.5%       5.1%
        Miscellaneous                  7      10       n.m.     n.m.       n.m.
        Group Total                  432     641     +48.4%     2.2%       3.1%
        By geographic area:
        France                        77      78      +1.3%     1.3%       1.3%
        Other Western European
        countries                    133     191     +43.6%     1.6%       2.2%
        North America                 66     113     +71.2%     2.3%       4.1%
        Emerging countries and
        Asia                         156     259     +66.0%     4.3%       6.2%
        Group Total                  432     641     +48.4%     2.2%       3.1%
                                              H1
                                   H1 2010   2011             H1 2010    H1 2011
                                   (in EUR   (in              (in % of   (in % of
                                     m)     EUR m) Change on   sales)     sales)
        VI. EBITDA                                 an actual
                                                    structure basis
        By sector and division:
        Innovative Materials         715     842    +17.8%     15.8%      17.4%
        Flat Glass                   352     421    +19.6%     13.9%      15.2%
        High-Performance
        Materials                    363     421    +16.0%     18.1%      20.2%
        Construction Products        811     803     -1.0%     15.0%      14.1%
        Interior Solutions           341     374     +9.7%     13.5%      13.7%
        Exterior Solutions           470     429     -8.7%     16.2%      14.2%
        Building Distribution        336     462    +37.5%      4.0%       5.1%
        Packaging (Verallia)         344     347     +0.9%     19.5%      19.1%
        Miscellaneous                 14      25      n.m.      n.m.       n.m.
        Group Total                2,220   2,479    +11.7%     11.4%      11.9%
        By geographic area:
        France                       547     622    +13.7%      9.5%      10.1%
        Other Western European
        countries                    687     819    +19.2%      8.4%       9.3%
        North America                466     425     -8.8%     16.4%      15.3%
        Emerging countries and
        Asia                         520     613    +17.9%     14.3%      14.8%
        Group Total                2,220   2,479    +11.7%     11.4%      11.9%
        Appendix 2: Sales by business sector and geographic area - Second
        Quarter
                                                   Change on Change on  Change on
                                              Q2                 a          a
        SALES                      Q2 2010   2011 an actual comparable comparable
                                   (in EUR   (in   structure structure  structure
                                     m)     EUR m)   basis     basis       and
                                                                         currency
                                                                          basis
        By sector and division:
        Innovative Materials (1)    2,429   2,441    +0.5%     +2.6%      +5.5%
        Flat Glass                  1,344   1,406    +4.6%     +4.6%      +5.8%
        High-Performance
        Materials                   1,089   1,042    -4.3%     +0.4%      +5.5%
        Construction Products (1)   3,009   3,055    +1.5%     +1.0%      +3.7%
        Interior Solutions          1,344   1,375    +2.3%     +2.3%      +3.9%
        Exterior Solutions          1,674   1,694    +1.2%     +0.3%      +3.9%
        Building Distribution       4,659   4,892    +5.0%     +4.7%      +4.5%
        Packaging (Verallia)          973     966    -0.7%     -1.7%      +2.2%
        Internal sales and misc.     -278    -278     n.m.      n.m.       n.m.
        Group Total                10,792  11,076    +2.6%     +2.7%      +4.4%
        (1) including intra-sector
        eliminations
        By geographic area:
        France                      3,108   3,228    +3.9%     +3.9%      +3.9%
        Other Western European
        countries                   4,539   4,732    +4.3%     +4.0%      +3.2%
        North America               1,597   1,471    -7.9%     -6.7%      +3.9%
        Emerging countries and
        Asia                        2,022   2,170    +7.3%     +7.2%      +9.7%
        Internal sales               -474    -525     n.m.      n.m.       n.m.
        Group Total                10,792  11,076    +2.6%     +2.7%      +4.4%
        Appendix 3: Consolidated balance sheet
                                                     June 30,
        (in EUR million)                               2011     Dec 31, 2010
                          ASSETS
        Goodwill                                         10,887       11,030
        Other intangible assets                           3,024        3,067
        Property, plant and equipment                    13,389       13,727
        Investments in associates                           132          137
        Deferred tax assets                                 677          700
        Other non-current assets                            307          272
        Non-current assets                               28,416       28,933
        Inventories                                       6,425        5,841
        Trade accounts receivable                         6,369        5,038
        Current tax receivable                               86          175
        Other accounts receivable                         1,412        1,248
        Cash and cash equivalents                         1,275        2,762
        Current assets                                   15,567       15,064
        Total assets                                     43,983       43,997
           Liabilities and Shareholders' equity
        Capital stock                                     2,141        2,123
        Additional paid-in capital and legal
        reserve                                           5,913        5,781
        Retained earnings and net income for the
        year                                             10,817       10,614
        Cumulative translation adjustments                (743)        (383)
        Fair value reserves                                (17)         (43)
        Treasury stock                                    (345)        (224)
        Shareholders' equity                             17,766       17,868
        Minority interests                                  378          364
        Total equity                                     18,144       18,232
        Long-term debt                                    6,581        7,822
        Provisions for pensions and other employee
        benefits                                          2,732        2,930
        Deferred tax liabilities                            913          909
        Provisions for other liabilities and
        charges                                           2,126        2,228
        Non-current liabilities                          12,352       13,889
        Current portion of long-term debt                 1,595        1,094
        Current portion of provisions for other
        liabilities and charges                             523          527
        Trade accounts payable                            5,840        5,690
        Current tax liabilities                             117          156
        Other accounts payable                            3,258        3,395
        Short-term debt and bank overdrafts               2,154        1,014
        Current liabilities                              13,487       11,876
        Total equity and liabilities                     43,983       43,997
        Appendix 4: Consolidated cash flow statement
        (in EUR million)                                         H1 2011 H1 2010
        Net income attributable to equity holders of the parent      768     501
        Minority interests in net income                              42      37
        Share in net income of associates, net of dividents
        received                                                      (1)     (1)
        Depreciation, amortization and impairment of assets          886     830
        Gains and losses on disposals of assets                      (21)     (9)
        Unrealized gains and losses arising from changes in fair
        value and share-based payments                                 4      32
        Changes in inventories                                      (692)   (416)
        Changes in trade accounts receivable and payable, and
        other accounts receivable and payable                     (1,267) (1,011)
        Changes in tax receivable and payable                         49     211
        Changes in deferred taxes and provisions for other
        liabilities and charges                                     (127)   (106)
        Net cash from operating activities                          (359)     68
        Purchases of property, plant and equipment [ H1-2011:
        (641), H1-2010: (432) ] and intangible assets               (676)   (451)
        Acquisitions of property, plant and equipment in finance
        leases                                                        (4)     (3)
        Increase (decrease) in amounts due to suppliers of fixed
        assets                                                      (173)   (152)
        Acquisitions of shares in consolidated companies [
        H1-2011: (172), H1-2010: (33) ], net of debt acquired       (183)    (70)
        Acquisitions of other investments                            (10)     (3)
        Increase in investment-related liabilities                     2      21
        Decrease in investment-related liabilities                    (6)     (2)
                               Investments                        (1,050)   (660)
        Disposals of property, plant and equipment and intangible
        assets                                                        74      45
        Disposals of shares in consolidated companies, net of net
        debt divested                                                 (2)     13
        Disposals of other investments and other divestments          (6)      9
                               Divestments                            66      67
        Increase in loans and deposits                               (19)    (27)
        Decrease in loans and deposits                                19      20
        Net cash used in investing activities / divestments         (984)   (600)
        Issues of capital stock                                      150     509
        Minority interests' share in capital increases of
        subsidiaries                                                   1       2
        Increase (decrease) in investment-related liabilities (put
        on minority interests)                                       (12)    (11)
        (Increase) decrease in treasury stock                       (122)     (4)
        Dividends paid                                              (603)   (509)
        Dividends paid to minority shareholders of consolidated
        subsidiaries and increase (decrease) in dividends payable    (14)    100
        Net Cash from (used in) financing activities                (600)     87
        Increase (decrease) in net debt                           (1,943)   (445)
        Net effect of exchange rate changes on net debt               37     (87)
        Net effect from changes in fair value on net debt             19       5
        Net debt at beginning of period                           (7,168) (8,554)
        Net debt at end of period                                 (9,055) (9,081)
        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


Source: newswire