24th Mar 2005 18:35
Compagnie de Saint-Gobain24 March 2005 March 24, 2005 press release FINAL RESULTS FOR 2004: Confirmation of the figures published at the end of January 2005 > STRONG GROWTH IN OPERATING PERFORMANCE - Sales up 8.2% to EUR 32,025 million, - Operating income up 7.8% to EUR 2,632 million, up 10.3% at constant exchange rates*. On a like-for-like basis: - Sales up 4.6% - Operating income up 8.1% > NET INCOME EXCLUDING CAPITAL GAINS UP BY 10%, to EUR 1,122 million > FURTHER DECREASE IN NET DEBT, to EUR 5.6 billion. DIVIDEND FOR 2004 recommended for approval by the AGM: EUR 1.28 per share, up 11.3%. 2005 TARGETS CONFIRMED: > to achieve 6% growth in operating income at constant exchange rates (average 2004 exchange rates) and based on comparable accounting standards. > to maintain strong free cash flow levels. (*) based on average 2003 exchange rates At its meeting of Thursday March 24, 2005, the Board of Directors ofSaint-Gobain reviewed the Group's consolidated financial statements for 2004. • Analysis of the 2004 key consolidated data: The key consolidated data for the Group, as well as the results by businesssector, division and geographical area set out in the appendix, are exactly thesame as the estimated figures published at the end of January(**). These figuresare as follows: 2003 2004 in EUR in EUR % millions millions change (1) (2) (2)/(1) Net sales 29,590 32,025 +8.2%Operating income 2,442 2,632 +7.8%Dividend income 12 3 -75.0%Interest and other financial charges, net (457) (441) -3.5%Non-operating costs (275) (280) +1.8%Income before profit on sales of non-current assets and 1,722 1,914 +11.1%taxesProfit (loss) on sales of non-current assets, net 86 (44) n.m.Provision for income tax (595) (603) +1.3%Amortization of goodwill (154) (155) +0.6%Share in net results of equity investees 6 8 +33.3%Net income before minority interests 1,065 1,120 +5.2%Minority interests (26) (37) +42.3%Net income 1,039 1,083 +4.2%Earnings per share (in EUR) 2,99 3.18 +6.4%Earnings per share excluding treasury stock (in EUR) 3,09 3.23 +4.5%Net income excluding profit on sales of non-current assets 1,020 1,122 +10.0%Earnings per share excluding profit on sales of 2.93 3.29 +12.3%non-current assets (in EUR)Earnings per share excluding profit on sales of 3.03 3.35 +10.6%non-current assets and treasury stock (in EUR)Cash flow from operations 2,471 2,612 +5.7%Cash flow excluding capital gains tax 2,540 2,608 +2.7%Capital expenditure 1,351 1,537 +13.8%Investments in securities 789 899 +13.9%Net indebtedness 5,657 5,566 -1.6% All of the comments made at the end of January(**) about the Group'sconsolidated financial statements therefore apply to the final figures. * * * Asbestos claims against CertainTeed in the United States: The Group confirms the figures and comments relating to 2004, published at theend of January(**) concerning this issue. At the initiative of the new Chairman of the US Senate Judiciary Committee,active negotiations have resumed in the past few weeks concerning the draftlegislation to create a federal asbestos trust fund. A new bill is expected tobe put before the Senate soon. * * * • Annual General Meeting: The Board of Directors also reviewed the accounts of Compagnie de Saint-Gobain,the parent company. Net income amounted to EUR 766 million for the year endedDecember 31, 2004, compared with EUR 514 million for 2003. At the General Meeting of the Company's shareholders, called for June 9, 2005,the Board will recommend the distribution of EUR 429 million (representing 38.2%of net income excluding capital gains). The dividend per share would thereforeamount to EUR 1.28, an increase of 11.3% over last year. Based on today'sclosing share price, this dividend represents a gross yield of 2.75%. Thedividend will be paid entirely in cash as from June 23, 2005. In addition, the Board of Directors will ask the General Meeting of June 9, 2005to renew the terms of office as directors of Gianpaolo Caccini, Jean-Martin Folzand Michel Pebereau, and to appoint Gerhard Cromme, Chairman of theThyssenKrupp's Supervisory Board (replacing Rolf-E. Breuer), and Jean-CyrilSpinetta, Chariman of Air-France KLM (replacing Bruno Roger), to the Board ofDirectors. • 2005 outlook and targets: the Group confirms that in 2005 it willaim to achieve 6% growth in operating income at constant exchange rates (average2004 exchange rates) and based on comparable accounting standards. The groupalso aims to maintain strong free cash flow levels. (**) The press release relating to the Group's estimated 2004 results -published at the end of January 2005 - is available on the Saint-Gobain websiteat www.saint-gobain.com. Forthcoming results announcements: - Main impacts of the changeover to IFRS on the Group's 2004 consolidatedfinancial statements: March 29, 2005, after close of trading on the Parisstock-exchange. - Sales for the first quarter of 2005 (under IFRS): April 26, 2005, after closeof trading on the Paris stock-exchange. Investor Relations Department Mrs. Florence Trious-Teixeira Tel.: +33 1 47 62 45 19Mr. Alexandre ETUY Tel.: +33 1 47 62 37 15 Fax: +33 1 47 62 50 62 Final results by Business Sector, Division andGeographic Area(In millions of euros) Change on a Change on Change on a comparableI. SALES 2003 2004 an actual comparable structure and structure structure currency basis basis basis1degrees) By sector and division:Building Distribution (1) 11 305 13 679 +21,0% +5,3% +5,0%High-Performance Materials (1) 4 452 4 717 +6,0% +3,7% +8,9%Ceramics and Plastics & Abrasives 3 256 3 473 +6,7% +5,3% +10,8%Reinforcements 1 212 1 264 +4,3% -0,2% +4,0%Flat Glass (1) 4 298 4 394 +2,2% +1,4% +2,9%Packaging (1) 3 869 3 779 -2,3% -2,8% +0,8%Construction Products (1) 6 233 6 004 -3,7% +0,5% +4,3%Building Materials 2 824* 2 625 -7,0% +3,1% +9,6%Insulation 1 909 2 018 +5,7% +5,0% +8,1%Pipe 1 516 1 381 -8,9% -9,3% -9,1%Internal sales and misc. -567 -548 n.m. n.m. n.m.GROUP TOTAL 29 590 32 025 +8,2% +2,4% +4,6% 2degrees) By geographic area:France 9 926 10 704 +7,8% +4,1% +4,1%Other western European countries 12 225 13 743 +12,4% +1,7% +1,2%North America 5 735 5 727 -0,1% +0,3% +10,1%Emerging countries and Asia 3 127 3 553 +13,6% +8,9% +13,9%Internal sales -1 423 -1 702 n.m. n.m. n.m.GROUP TOTAL 29 590 32 025 +8,2% +2,4% +4,6% (1) including inter-divisioneliminations * including companies sold in 2003:304 million euros Change onII.OPERATING INCOME 2003 2004 an actual structure basis1degrees) By sector and division:Building Distribution 560 737 +31,6%High-Performance Materials 370 466 +25,9%Ceramics and Plastics & Abrasives 273 392 +43,6%Reinforcements 97 74 -23,7%Flat Glass 471 440 -6,6%Packaging 442 440 -0,5%Construction Products 584 507 -13,2%Building materials 265* 195 -26,4%Insulation 168 242 +44,0%Pipe 151 70 -53,6%Miscellaneous 15 42 +180,0%GROUP TOTAL 2 442 2 632 +7,8% 2degrees) By geographical area:France 884 825 -6,7%Other western European countries 779 906 +16,3%North America 452 481 +6,4%Emerging countries and Asia 327 420 +28,4%GROUP TOTAL 2 442 2 632 +7,8% * including companies sold in 2003:61 million euros Change on 2003 2004 an actualIII. CASH FLOW structure basis1degrees) By sector and division:Building Distribution 398 515 +29,4%High-Performance Materials 435 490 +12,6%Ceramics and Plastics & Abrasives 291 356 +22,3%Reinforcements 144 134 -6,9%Flat Glass 548 508 -7,3%Packaging 504 490 -2,8%Construction Products 526 538 +2,3%Building Materials 172* 203 +18,0%Insulation 210 267 +27,1%Pipe 144 68 -52,8%Miscellaneous 60** 71** +18,3%GROUP TOTAL 2 471 2 612 +5,7% 2degrees) By geographic area:France 832 827 -0,6%Other western European countries 800 878 +9,8%North America 450** 441** -2,0%Emerging countries and Asia 389 466 +19,8%GROUP TOTAL 2 471 2 612 +5,7% * including companies sold in 2003:56 million euros ** after asbestos-related charge (net of tax)of _66m in 2003 and _72m in 2004. Change on an 2003 2004 actualIV. CAPITAL EXPENDITURE structure basis1degrees) By sector and division:Building Distribution 213 249 +16,9%High-Performance Materials 251 239 -4,8%Ceramics and Plastics & Abrasives 108 132 +22,2%Reinforcements 143 107 -25,2%Flat Glass 364 448 +23,1%Packaging 265 302 +14,0%Construction Products 257 294 +14,4%Building Materials 117* 102 -0,1%Insulation 90 145 +61,1%Pipe 50 47 -6,0%Miscellaneous 1 5 n.m.GROUP TOTAL 1 351 1 537 +13,8% 2degrees) By geographic area:France 305 361 +18,4%Other western European countries 459 483 +5,2%North America 233 274 +17,6%Emerging countries and Asia 354 419 +18,4%GROUP TOTAL 1 351 1 537 +13,8% * including companies sold in 2003:14 million euros Saint-Gobain's acquisitions in 2004 Financial investment of €658 million for additional sales of almost €2 billion The purpose of this press release is to provide an update on the acquisitionscarried out by the Group in 2004 (not including share buybacks by Compagnie deSaint-Gobain), and particularly those which were not specifically announced atthe time. Acquisitions are a cornerstone of the Group's business development strategy, andare mainly pursued in three directions: - Building Distribution - primarily made up of local-based operationsoffering significant external growth potential in Europe, particularly throughbolt-on acquisitions, and acquisitions of small and medium-sized companies. - High-Performance Materials - involving operations carried out on aglobal scale - offers acquisition opportunities in both developed and emergingcountries, allowing the Group to respond to the needs of its industrial partnersaround the world. - Historic Businesses - whose growth potential is primarilyconcentrated in emerging countries (China, India, Latin America, Russia andEastern Europe). In each of these three groups of businesses, Compagnie de Saint-Gobain is facedwith a broad spectrum of acquisition opportunities. The opportunities it decidesto take up are selected on the basis of stringent criteria, including thequality of the teams available, responsiveness to customer needs, and provenability to create value for the Group. In 2004, excluding Dahl, the Saint-Gobain Group primarily carried out bolt-onacquisitions in the Building Distribution sector, alongside various transactionsin emerging countries within the Historic Businesses and High-PerformanceMaterials sectors. * * * Overview of 2004 acquisitions by group of businesses 2004 acquisitions Value of Debt Enterprise Estimated 2004 securities acquired value full-year sales *(in • m) acquiredDistribution - Dahl 384 312 696 1,503Distribution - bolt-on acquisitions 145 -17 128 317Historic Businesses 102 7 109 120High-Performance Materials 27 3 30 28 TOTAL acquisitions 658 305 963 1,968 • Building Distribution: Financial investment of €529 million for additionalsales of €1,820 million. In addition to the acquisition of the Scandinavian-based Dahl (financialinvestment of €384 million and €1,503 million in acquired sales), theDistribution sector carried out 30 bolt-on acquisitions in France, the UnitedKingdom and Germany, representing a financial investment of €145 million foradditional sales of €317 million. The principal transactions broken down by country were as follows: France - 18 companies acquired (61 sales outlets), representing total full-yearsales of €135 million - 8 specialized distributors, namely Boch Freres, a tiling and bathroomspecialist, Mi-Landes (Cazenave group) in south-western France, specialized inroofing products, Cessac and Sobem - two companies specializing in wood andpaneling based in the Paris region and in Normandy, the Paris-based plumbing andheating specialist Navatte, and Salgado, operating in the plumbing and heatingsector in the Aude and Pyrenees orientales regions. - 10 general distributors, namely Le Groupe Lejeune in Brittany, PorcherMateriaux based in Central France, and Combronde. United Kingdom - 10 companies acquired (24 sales outlets), representing totalfull-year sales of €79 million - 5 specialized distributors, including Northern Ireland-based Philip M.Bassett, specializing in plumbing and heating, Eastern Glazed Ceramics, adistributor of ceramic wall and floor tiles in south-western England, and tilingspecialists Maxon Tile Distributors. - 5 general distributors, including Pudsey Building Supplies in Yorkshire, E.P.Builders Merchants in Leicester and Stanley Milnes Ltd. Germany - 2 companies acquired (19 sales outlets), representing full-year salesof €103 million The acquisitions involved two specialist distributors, namely Kluwe, tilingdistributor, and Muffenrohr, specialized in public works, in which the Grouppurchased the remaining stake of 50%. • Historic Businesses: Financial investment of €102 million for additionalsales of approximately €120 million. Acquisitions in emerging countries: 11 transactions representing full-year salesof approximately €53 million In line with the Group's business model, growth in the Historic Businesses ismore keenly felt in emerging countries, where domestic markets will prove key tobusiness expansion efforts in the next few years. - In emerging countries, the Flat Glass sector made a series of acquisitions,primarily in China, where the largest acquisition concerned the Quingdao floatline. These transactions represent full-year sales of €36 million. - Acquisitions in the Construction Products sector (Building Materials &Insulation) in the Czech Republic and in China represented full-year sales of€17 million at the transaction date. Other acquisitions by the Historic Businesses: 10 transactions for full-yearsales of €67 million The Historic Businesses made a series of local and regional bolt-onacquisitions, particularly in the Construction Products sector, representing €54million in sales. In the Mortars business, the Building Materials divisionacquired French-based Mauer, Eurovente/Strasservil, Emfi France (plantspecialized in glues for tiling), as well as Lusocil in Portugal. The Insulationdivision acquired Plafometal, the leading French producer of metal frames andsuspended metal ceilings. • High-Performance Materials: Financial investment of €27 million foradditional sales of €28 million. The High-Performance Materials sector made a series of investments in emergingcountries with the aims of partnering its industrial customers worldwide and ofreducing its costs. All of the sector's financial investments were made inReinforcements: - In China, the Group created Saint-Gobain Technical Fabrics HongFa, ajoint-venture based in Changzhou specializing in fabrics for the compositesindustry. - In Russia, the Group acquired 85% of Steklovolokno, the leadingmanufacturer of reinforcement threads in Russia. - In Romania, the Group acquired Rompoliner, specialized distributor ofproducts for reinforcements. * * * Investor Relations Department Florence TRIOU-TEIXEIRA Tel.: +33 (0)1 47 62 45 19Alexandre ETUY Tel.: +33 (0)1 47 62 37 15 Fax: +33 (0)1 47 62 50 62 This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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