Amrize Ltd Ordinary Shares

Good morning, everybody, and very warm welcome on behalf of Lafarge-Holcim to our analyst call following our Q1 trading update announcement today. With me in the room are Mr. Jan Jenic, the CEO of Lafarge-Holcim, and Geraldine Picot, the CFO of Lafarge-Holcim. It's my pleasure to hand over right away to Mr. Jan Jenic. Go ahead, Jan.

Yes, good morning, everyone. Thank you for joining for our Q1 performance update. I'm very excited to share some more background and information with you in the next one hour or so. I will start with a few comments highlighting what happened, and then Geraldine will give us more details on regions and on development, and I will come back for the outlook. So, very exciting. You see the momentum, which... came back to us in the second half of last year has further accelerated sales are up more than seven percent and then especially our bottom line our margins have increased very over proportionally and the ebit is more than 130 plus for q1 i'm very happy to see that we have um worked I would say very hard last year to make this exceptional record margins a reality. You remember we launched our action plan health cost and cash already in March last year with the goal to come out of the crisis more competitive. And this is something we achieved. You see the excellent run rates that we have in Q4. then continued into Q1, and we expect this to continue also for the full year. Very exciting to see that all five regions have contributed to these exceptional results. I would say the number one region was Latin America, where cement volumes were up 17%, and EBIT margins were far over-proportional. Same for Asia, with the dominant country being India, also with volumes up by 20% in Q1, and also over-proportional profit margin improvement. Not to forget Middle East Africa, we continued the improvements. Cement volumes also here in these emerging markets up 3%, and then also a big improvement in margins. In the mature markets, Europe and North America, the weather pulled us back a bit on the volume side, something I think we will catch up now in Q2, but also here, big margin improvements. So overall, I would say quite, satisfied to see that all the measures we took last year are paying off and we come with a very good growth momentum and an exceptional margin development into 2021. Same is true for our progress in sustainability. We have really accelerated, as you know, and here we just have received Number one rating for our sector from VGO, they gave us the highest sustainability ranking, A1+, which puts us not only on top of our sector, but also this is a ranking only achieved by 2% of all companies worldwide. For me as a sales guy, even more exciting is the fast rollout of our EcoPact, our green concrete, which is already now introduced in all five regions. And here we make big progress to be successful with this very, very important green concrete for the future. From my side, this is a bit the highlights. I think we really made the super progress not only in all KPIs, also in sustainability. And now Gerardine gives us a bit more details and background on the regions and on the financial numbers.

Thank you, Jan. Let's go into slide 10 and start with the volumes. So this chart reflects the healthy recovery of the business in the quarter. In cement, as you can see, we recorded 6% like-for-like growth versus 2020. The strong volume performance has been achieved, mainly thanks to the emerging markets, while mature regions have been slower to recover. North America shows a decrease of 5% in cement volumes due to bad weather in the U.S., partly mitigated by the excellent trend of Canada East. LATAM recorded an outstanding performance again this quarter, achieving cement volume growth of plus 17%. All countries have contributed to growth with double-digit performance in major markets such as Mexico, Brazil, and Argentina. IPEC achieved a growth of 20% in cement volumes. In particular, India recorded double-digit growth benefiting from the stimulus programs in rural and urban residential construction. Cement volumes in Europe decreased by 2% on average, Some Western European countries, such as France, Spain, and Italy, recorded a double-digit growth. In contrast, Germany, Russia, and Poland experienced softer markets. Middle East-Africa average growth of 3% in cement volumes also reflects contrasting situation with strong growth in Iraq, stable activity in Nigeria and Egypt, while Algeria incurred a slight decline. Aggregate volumes declined by 4% light for light, mainly due to the slow market in the US. Ready Mix volume increased by 2%, boosted by a good rebound in France. If we now look at our net sales, you can see that our Q1 2021 net sales stood at 5,362 million Swiss francs, up 1.3% compared to Q1 2020. we achieved an excellent like-for-like growth of plus 7.4%. Overall, this growth reflects mainly a volume increase by 4.3% and an average price increase of plus 3.5%. If we compare with Q1 2019, which was not affected by the COVID crisis, we also recorded a strong like-for-like growth of plus 4.4%, almost entirely attributable to pricing. The Q1 2021 like-for-like growth in themselves was partially offset by currency translation, which had an impact of minus 6.5%. This stems from several currencies which have depreciated compared to the Swiss francs, but primarily the Indian rupee, the Argentinian peso, and the Nigerian nera. Let's now move on to the recurring EBIT. which I'm very pleased to say has more than doubled in total from 262 million Swiss francs in Q1 2020 to reach 528 million Swiss francs this quarter. The absolute growth of 266 million Swiss francs mainly includes an outstanding like-for-like growth of 342 million Swiss francs, partly offset by the currency translation effect of minus 79 million Swiss francs due to the currencies I just indicated. Focusing on the drivers of the organic growth, the volume effect explains an increase of 48% or 125 million Swiss francs, mainly attributable to the recovery in the cement volumes. The strong positive price of a cost of 220 million Swiss francs reflects several favorable actions Firstly, the increase in our average selling price by 3.5%, and secondly, the continued cost monitoring, which has allowed a reduction of 54 million Swiss francs in the operating cost. The contribution of our JVs increased by 10 million Swiss francs, mainly thanks to Washington, which was strongly impacted by COVID-19 lockdown at the beginning of last year in China. If we now move to the slide 13 here, you can see that we have, as a group, as Jan mentioned, a recurring EBIT margin in Q1 that has risen by 4.9 percentage points. And the slide provides an overview of the results by region. I will comment on each one in detail shortly. But at this stage, you will notice that all the regions have increased their EBIT margins and that their like-for-like EBIT growth is significantly over-proportionate to their sales growth. So let's start with North America. As usual, Q1 is a seasonally low quarter. Net sales decreased by 6.5% like-for-like. The bad weather in January and February impacted negatively the aggregates and cement business in the U.S. These volumes were partly mitigated by a positive pricing impact of plus 2.2% like-for-like. Recurring EBIT increased by 27.7% like-for-like, over-proportionately to sales, mainly thanks to efficiencies in both variable and fixed costs. Latin America delivered another quarter of outstanding performance, with net sales up 31.4% like-for-like and recurring EBIT up 68.9% like-for-like. Double digit volume growth versus last year across all business segments strongly contributed to the top line increase. Cement volumes exceeded the 2019 level by plus 10%. This exceptional growth was driven by strong cement demand from residential housing in the region and also from our continued participation in large iconic infrastructure projects in Mexico. The region delivered a record recurring EBIT margin expansion of plus 8.1 percentage points, the highest in the group, further driven by improved pricing and a strong operational performance. If we now turn to Europe, performance has been solid in Q1, with net sales up 3.5% like for like and recurring EBIT up 102% like for like. Well, still slightly behind last year, the volumes in all business segments have seen strong trends in March across the majority of our markets in Europe. In particular, France saw strong volume performance versus 2020 from the lockdowns of last year. The region recorded an increase in its recurring EBIT margin by 1.7 percentage points, supported by strong pricing trends and the successful execution of of our health cost and cash action plan. You can see as well a strong improvement in profitability in Middle East Africa, where recurring EBIT increased by 48.1% like for like, over proportionally to the net sales growth of 5.1% like for like. Cement volumes grew in the quarter, driven by good trends observed in Iraq, Kenya, Nigeria, Additionally, we benefited from sales of our branded products as well as export activities. Again, a continuous turnaround contributed to a strong improvement in the recurring EBIT margin of the region by 3.8 percentage points. Let's now move to APAC, another region with a very strong performance for the quarter, with net sales up 17% like for like. and a recurring EBIT which recorded a growth of 86% like for like. Double-digit volume growth of cement and aggregates versus last year were the key driver of the top-line expansion. Further, and similar to Latin America, cement volumes even surpassed the level of 2019 on a like for like basis. India delivered a very solid performance in the quarter, expanding its recurring EBIT margin by more than 6 percentage points. This strong performance was mainly driven by double-digit volume growth coming from the stimulus programs in rural and urban areas, effective price management, and strong operational efficiency in the country. We also have seen improving activities in Australia and stronger contributions from our Chinese operations. As a result, the region delivered a record recurring EBIT margin improvement of 7.3 percentage points. With this, I hand over to you, Jan.