The slides for the analyst presentation - Lafarge

Granulats et Béton - Afrique du Sud, 

stade Moses Mabhida 

2010 Full Year Results 

February 18, 2011

Disclaimer 

This document may contain forward-looking statements. Such forward-looking statements 

do not constitute forecasts regarding the Company’s results or any other performance 

indicator, but rather trends or targets, as the case may be. These statements are by their 

nature subject to risks and uncertainties, many of which are outside our control, including, 

but not limited to the risks described in the Company’s annual report available on its 

Internet website (www.lafarge.com). These statements do not reflect future performance of 

the Company, which may materially differ. The Company does not undertake to provide 

updates of these statements. 

More comprehensive information about Lafarge may be obtained on its Internet website 

(www.lafarge.com). 

This document does not constitute an offer to sell, or a solicitation of an offer to buy 

Lafarge shares. 

2



Bruno Lafont 

Chairman and CEO

Group Positioned for Recovery in 2011 

� Successful cash generation measures in 2010 built strong base 

for the upcoming year 

� Drove structural cost savings of €220M 

� Improved working capital by 11 days 

� Secured divestments of over €500M 

� Strategy focused on profitable sales growth 

� Diversified portfolio benefited from recovery of mature markets 

� Started 12 MT of capacity in emerging markets 

� Maintained resilient pricing 

� Executed asset swap that establishes a leadership position 

in growing Brazil market 

4

Higher Volumes to Drive 2011 Earnings Growth 

� High quality plants to capture volume growth in emerging markets 

� Fundamental drivers of construction remain strong 

� Market expansion is absorbing new capacities 

� Lafarge’s strategically placed 68 MT of capacity additions between 

2006 and 2010 will drive growth 

� New Brazilian assets significantly contributing to results 

� Lower cost base in place as volumes improve in developed markets 

� Large room for recovery 

� Significant operating leverage potential as volumes return 

� Taking further action to offset the impact of higher inflation 

� Price increase announcements made / being planned 

� Cost cutting actions continue to be significant 

A return to growth 

5

€2 Billion Debt Reduction in 2011 

� Actions secure a minimum of €1Bn debt reduction 

� Reduction of capex by €400M 

� Reduction of dividend by 50% to €1 per share 

� Reduction of costs and working capital 

� Higher cash flows from operations provide upside 

� Use divestments as an accelerator of this process 

� At least €750 million of divestments in 2011 

A significantly improved financial structure 

6

North America 

21MT 

4% 

65% 

A Well Diversified Portfolio in Place to Capture 

the Growth of Our Markets 

Latin America 

12MT 

5% 

75% 

Western Europe 

37MT 

2% 

55% 

Middle East 

and Africa 

55MT 

6% 

80% 

Central and Eastern Europe 

20MT 

6% 

55% 

Asia 

Total Capacity end 2010 

Construction Growth Forecast through 2020* 

Utilization rates for 2010 

Capacity already in place to capture growth as developed 

markets recover and emerging markets continue to grow 

* Source: Global Construction 2020 report prepared in 2010 by Global Construction Perspectives and Oxford Economics 

72MT 

8% 

75% 

7

Further Development of 11 million tons for 2011 

Brazil 

0.4 MT 

Algeria 

0.5 MT 

Poland 

0.5 MT 

Hungary 

1 MT 

Nigeria 

2.2 MT 

Iraq 

0.4 MT 

Saudi 

2 MT India 

1 MT 

China 

3 MT 

Diverse geographic portfolio of capacity additions 

to generate solid returns 

8

A Focus on Egypt 

� Latest facts 

� 7 days of sales interruption in total 

� Sales have resumed since February 5th and are near pre-crisis levels 

� Egypt represents 4% of the Group’s 2010 revenues 

� Stability is returning and long-term growth potential of Egypt 

is very significant 

� Largest growing population in the Middle East 

� Significant requirements for new housing and infrastructure 

9

Portfolio Optimization – A Non-Cash Deal 

that Strengthens Lafarge’s UK Position 

� Lafarge and Anglo American to create a leading United Kingdom 

construction materials company 

� 50/50 Lafarge UK / Tarmac joint venture combining cement, aggregates, 

ready-mix concrete, and asphalt/paving businesses 

� Non-cash transaction 

� Combined revenues of £1.8 billion and EBITDA of £210 million for 2010 

� The combined operations will unlock significant value 

� EPS accretive to Lafarge 

� Generates at least £60M in annual synergies 

• economies of scale 

• introduction of valued added products across a wider geographic reach 

� JV to benefit from a future recovery in the UK market 

� Significant aggregates reserves 

� Next steps 

� Regulatory approval 

� Businesses will operate independently during this process 

10

Strong Potential for the Future 

� Volume improvement to underpin earnings growth 

� Recovery of mature markets 

� Continued growth in emerging markets 

� Management actions leverage strength of growth 

� Strategically diversified geographic portfolio of assets 

� Cost reduction part of the Group’s culture 

� Non-cash deals that strengthen local positions 

� Significant debt reduction for 2011 

� Operational cash flows 

� Divestments 

11

Granulats et Béton - Brésil, 

Musée d'Art Contemporain 

Jean-Jacques Gauthier 

Chief Financial Officer

Solid Performance in 2010 in a Challenging 

Environment 

� Fourth Quarter Highlights 

� Cement volumes rose in the quarter, the first increase since Q4 2008 

� Current operating income increased 7%, helped by the strength 

of the Brazilian assets acquired in Q3 and favorable foreign exchange 

� €50M of structural cost savings partially offset the higher cost 

of inflation 

� Strong cash flows due to working capital actions 

� Full Year Highlights 

� Rate of volume declines slowed significantly for the year 

� Pricing remained resilient in the face of a challenging environment 

� Achieved target of securing more than €500M of divestments 

� Exceeded structural cost savings target, achieving €220M for the year 

� Generated strong free cash flows of €2.2Bn (1) for the year 

(1) Excluding the €338m one-time payment for the Gypsum competition fine paid in the third quarter 2010 

13

Key Figures 

12 months 4 th Quarter 

€m 2009 2010 Variation lfl 2009 2010 Variation lfl 

Sales 15,884 16,169 2% -3% 3,641 3,959 9% - 

EBITDA 3,600 3,614 - -6% 768 824 7% -2% 

Current Operating Income 2,477 2,441 -1% -8% 494 530 7% -4% 

Operating Margin 15.6% 15.1% -50bp 13.6% 13.4% -20bp 

Net income Group share (1) 736 827 12% (38) 62 nm 

Earnings per share (in €) 2.77 2.89 4% (0.13) 0.22 nm 

Net dividend (in €) (2) 2.00 1.00 

ROCE (3) 6.0% 5.8% 

Free cash flow 2,834 2,151 (4) -24% 1,123 848 -24% 

Net debt 13,795 13,993 1% 

(1) Net income attributable to the owners of the parent company. 

(2) Subject to approval of Annual General Meeting 

(3) After tax, using the effective tax rate 

(4) Excluding the €338m one-time payment for the Gypsum competition fine paid in the third quarter 2010 

14

Exceeded 2010 Cost-Cutting Target 

� Driving permanent cost savings for the Group 

� Leveraging industrial technical expertise, purchasing power, 

and knowledge sharing through the Group network 

� Focus on energy efficiency, industrial productivity and SG&A 

Structural cost cuts (million €) 

70 

0,4% * 

*% of sales 

170 

180 

1,0% * 0,9% * 

230 

1,4% * 

2006 2007 2008 2009 

220 

1,4% * 

2010 

Achieving over €1Bn of structural cost savings since 2006 

>200 

Obj 2011 

15

Brésil, cimenterie, usine d’Arcos 

Cement

Cement Highlights 

(1) Before elimination of inter divisional sales 


MT 2009 2010 Variation lfl 2009 2010 Variation lfl 

Volumes 141.2 135.7 -4% -3% 33.6 34.4 2% 1% 

€m 

Sales (1) 10,105 10,280 2% -3% 2,288 2,514 10% 1% 

EBITDA 3,076 3,005 -2% -7% 683 695 1% -7% 

Current Operating Income 2,343 2,230 -5% -10% 507 503 -1% -9% 

€ 

EBITDA / t 21.8 22.1 

Operating margin 

23.2% 21.7% 

2009 2010 

� Volumes increased in Q4 for the first time since Q4 

2008, supported by a return to growth in emerging 

markets. 

� Prices were resilient in a challenging environment, 

despite price declines in some markets. 

� For the year, our cost reduction program supported 

a solid 2010 EBITDA margin of 29.2%, despite rising 

variable costs in the second half of the year. 

17

Cement highlights 

Resilient earnings in a challenging environment 

By geographical zone 


2009 2010 Variation 2009 2010 Variation 

COI (€m) 2,343 2,230 -5% 507 503 -1% 

Western Europe 507 427 -16% 130 70 -46% 

North America 24 79 229% (1) 13 nm 

Central and Eastern Europe 262 193 -26% 47 22 -53% 

Middle East and Africa 1,048 1,000 -5% 212 267 26% 

Latin America 140 193 38% 35 58 66% 

Asia 362 338 -7% 84 73 -13% 

� In Western Europe, positive UK volume trends and strong cost reduction only partially offset the impact of the 

steep volume declines in Greece and Spain. In Q4, poor weather and fewer carbon credit sales lowered results. 

� North America volume recovery and cost containment supported earnings growth for both the FY and Q4. 

� Central and Eastern Europe results were impacted by difficult economic conditions in Romania and lower prices 

in Poland. Market trends in Russia and Poland improved in the second half, although harsh weather and fewer 

carbon credit sales weighted on Q4 results. 

� MEA market trends were positive but results were lower for the year due to the entrance of new capacities 

(Jordan) and production shortfalls (Algeria). Q4 volumes returned to growth and current operating income 

benefited from the reversal of a regulatory fee on raw materials in Egypt. 

� Latin America grew due to dynamic market trends and newly integrated Brazil assets. 

� Asia earnings declined due to lower prices in South Korea and China, compounded by rising costs. 

18

Ciment - Granulats et Béton - Brésil, 

centre administratif gouvernemental 

de l'état de Minas Gerais 

Aggregates & Concrete

Aggregates & Concrete Highlights 

Signs of Improvement for Aggregates Volumes 

and Tight Cost Management 

Volumes 

Pure Aggregates MT 

Ready-Mix Concrete Mm 3 

€m 



2009 2010 Variation lfl 2009 2010 Variation lfl 

196.0 

37.1 

193.2 

34.0 

-1% 

-8% 

Sales (1) 5,067 5,093 1% -3% 1,173 1,260 7% -1% 

EBITDA 458 482 5% -6% 116 123 6% -4% 

Current Operating Income 193 216 12% -8% 46 53 15% -8% 


3.8% 

4.2% 

2009 2010 

1% 

-5% 

48.3 

8.6 

48.1 

8.4 

0% 

-2% 

0% 

-3% 

� Sales stabilized in the fourth quarter, supported by 

volume growth in North America and in the United 

Kingdom. 

� Operating margin improved, reflecting continuous 

cost containment and aggregates volumes 

improvement. 

� Ready-Mix sales of Value Added Products 

improved at comparable scope 

and contributed to earnings. 

20

Plätre- Afrique du Sud, immeuble de 

Johannesburg 

Gypsum

Gypsum 

Continuing Results Improvements 



Mm² 2009 2010 Variation lfl 2009 2010 Variation lfl 

Volumes 667 690 3% 3% 165 173 5% 5% 

€m 

Sales (1) 1,355 1,441 6% 2% 320 351 10% 4% 

EBITDA 119 143 20% 13% 17 30 76% 61% 

Current Operating 

Income 


2.8% 

4.0% 

2009 2010 

38 58 53% 42% (4) 10 nm nm 

� Organic growth in sales both year-to-date 

and in Q4. 

� Solid market trends in Asia and in the UK. 

� Operating margin improved in a context of slightly 

lower prices, thanks to tight cost control and 

improved volumes. 

22



Net Income

Net Income 


€m 2009 2010 2009 2010 

Current Operating Income 2,477 2,441 494 530 

Other income (expenses) (227) (272) (209) (127) 

Finance costs, net (926) (723) (1) (248) (224) 

Income from associates (18) (16) (4) (2) 

Income taxes (260) (316) (16) (32) 

Non-controlling interests (310) (287) (55) (83) 

Net income Group Share (2) 736 827 (38) 62 

(1) Including the gain on the disposal of Cimpor shares for €161m 

(2) Net income attributable to the owners of the parent company. 

24



Cash Flow and Debt 

Highlights

Cash Flow 


€m 2009 2010 2009 2010 

Cash flow from operations 

Change in working capital 

Sustaining capex 

2,177 

1,029 

(372) 

2,156 (1) 

354 

(359) 

405 

891 

(173) 

(1) The €338m one-time payment for the Gypsum competition fine paid in the third quarter 2010 is excluded from the cash flow 

from operations and presented in a separate line to facilitate comparability of periods 

(2) Including debt acquired / Net of the debt disposed of, and including the non controlling interests’ share in capital increase of subsidiaries 

(mainly EBRD additional investment in our operations in Eastern Europe in Q4 2009 and Q4 2010) 

(3) Including the divestment of a minority stake in Lafarge Malayan Cement Berhad for €141m in Q3 2010 

323 

698 

(173) 

Free cash flow excluding non recurring payment 2,834 2,151 (1) 1,123 848 

Non-recurring payment (1) - (338) - - 

Free cash flow 2,834 1,813 1,123 848 

Development investments (2) 

Divestments (2) 

(1,349) 

919 

(1,034) 

364 (3) 

(338) 

286 

(198) 

78 

Cash flow after investments 2,404 1,143 1,071 728 

Dividends 

Equity issuance (repurchase) 

Currency fluctuation impact 

Change in fair value 

Others 

(536) 

1,448 

33 

(138) 

(122) 

(849) 

26 

(490) 

41 

(69) 

(26) 

3 

(111) 

(64) 

(55) 

(28) 

6 

(128) 

54 

35 

Net debt reduction (increase) 3,089 (198) 818 667 

Net debt at the beginning of period 16,884 13,795 14,613 14,660 

Net debt at period end 13,795 13,993 13,795 13,993 

26

Successful Working Capital Actions 

to Maximize Cash Flow Generation 

� Strict Working Capital brought close to 30 sales days 

at the end of 2010 

Strict Working Capital in days of sales 

� Actions generated more than € 350 million of additional cash flows 

in 2010. 

27

Balanced Debt Maturity Schedule 

and Strong Liquidity 

2 000 

1 800 

1 600 

1 400 

1 200 

1 000 

800 

600 

400 

200 

0 

Lafarge SA Commercial paper Lafarge SA Bonds & other MLT instruments 

Subsidiaries debt instruments 

Securitization programs 

Orascom acquisition facility (drawings) 

at December 31, 2010 (€m) (1) 

2011 2012 2013 2014 2015 2016 2017 2018 2019 After 

2019 

� Successfully refinanced €2.7Bn in 2010 with an average interest 

cost of 4.5% and average maturity of 6.5 years. 

� Cash and cash equivalents and committed unused credit lines fully 

cover short-term obligations. 

(1) Excluding puts on shares and derivatives instruments: €0.3bn in 2010 and 2009 

28

Strong Liquidity Backed 

by Well Balanced Committed Credit Lines 

€m, as at December 31, 2010 

Line 

currency 

Line 

size 

Amount 

available 

Expiry 

date 

Financial 

covenant 

MAC 

clause 

Syndicated credit facility EUR 1,764 1,764 28/07/13 (1) No No 

Bilateral committed credit facilities EUR 2,024 2,024 Various (2) No No 

Total Lafarge SA committed 

credit lines 

3,788 3,788 

� Cash and cash equivalents of €3.3Bn 

� Lafarge SA committed unused credit lines of €3.8Bn with average 

maturity of 2.7 years 

� Only €510m maturing by the end of 2012 

� 24 banks participating to the syndicated credit facility 

� No financial covenants on any credit facility 

(1) Except €110m, maturing on July 28, 2012. 

(2) From April 2011 to July 2015 

29



Outlook 2011

2011 Outlook – Market * Overview 

Volumes (%) Price Highlights 

North America 1 to 4 + Progressive recovery; prices improving 

Western Europe -5 to -2 =/+ 

Central and Eastern Europe 3 to 6 + 

Slowdown in Spain and Greece with 

modest improvement in France 

Solid market trends in Russia and Poland; 

Romania lower with stabilization 

elsewhere; prices improving 

Middle East and Africa 4 to 7 =/+ (1) Solid market trends in most countries 

Latin America 7 to 10 + Solid market trends; prices improving 

Asia 5 to 8 + Solid market trends; prices improving 

Overall 3 to 6 + 

* Market growth forecast at national level 

(1) Relative to year-end pricing; down at average pricing 

Solid market trends in most emerging 

countries and stabilization or slow 

recovery in mature markets 

31

2011 Outlook – Other Elements 

(1) Impacted by country mix 

� +8% energy cost increase (1 euro per tonne) 

� Structural cost reduction of a further €200 m in 2011 

� Cost of debt (gross): 5.7% 

� Tax rate: 26% (1) 

� Capital expenditures: 

- Sustaining: ~ €0.5 Bn 

- Development: ~ €0.5 Bn 

32



Conclusion



Appendices 

I. 2011 Market Overview

2011 Outlook – Market (1) overview 

Cement 

North America 

United States 

Canada 


France 

United Kingdom 

Spain 

Greece 


Poland 

Romania 

Russia (1) 

Serbia 

Latin America 

Brazil 

Honduras 

Ecuador 

Market Volumes 

(%) 

1 to 4 

1 to 4 

3 to 6 

-5 to -2 

1 to 4 

-1 to 2 

-15 to -12 

-10 to -7 

3 to 6 

7 to 10 

-7 to -4 

8 to 11 

0 to 3 

7 to 10 

8 to 11 

4 to 7 

4 to 7 

Middle East and Africa 

Algeria 

Egypt 

Iraq 

Jordan 

Kenya 

Morocco 

Nigeria 

South Africa 

Syria 

Asia 

China (1) 

India (1) 

Indonesia 

Malaysia 

Philippines 

South Korea 

(1) Market growth forecast at national level except for China, India and Russia for which only relevant markets are considered 

Market Volumes 

(%) 

4 to 7 

5 to 8 

3 to 6 

10 to 13 

0 to 3 

3 to 6 

1 to 4 

8 to 11 

0 to 3 

3 to 6 

5 to 8 

6 to 9 

7 to 10 

6 to 9 

3 to 6 

5 to 8 

-6 to -3 

Overall 3 to 6 

35

2011 Outlook – Market overview 

Aggregates & Concrete – Gypsum 

� Aggregates and Concrete 

� Gypsum 

� Mature markets: subdued volume growth in North America with 

contrasted trends in Western Europe. 

� Emerging markets: volume growth in most countries. 

� Price improvement expected for both Pure Aggregates and Ready-Mix 

concrete in a challenging context. 

� Volume and price improvement. 

36

Brésil, cimenterie, usine d’Arcos 

II. Other Information 

Cement - Regional information

YTD Sales at December 31, 2010 – Cement 

Like for Like Sales Variance Analysis by Region and in Major Markets (1) 

Cement – Analysis by Region and in Major 

Markets as at December 31, 2010 

(1) Variance on like for like sales on domestic markets before elimination of sales between Divisions 

(2) Other effects: including price effects, product and customer mix effects 

(3) Volumes in the United States: 5.8%; in Canada: 9.9% 

(4) Pure price effect: +0.4% 

(5) Mainly due an increase in excise taxes 

Volume effect Other effects (2) Activity variation 

vs. 2009 

North America 6.8% (3) -3.5% 3.3% 


France 


Spain 

Germany 

Greece 


Poland 

Romania 

Serbia 

Russia 

Middle East and Africa 

Egypt 

Iraq 

Jordan 

Algeria 

South Africa 

Morocco 

Kenya 

Nigeria 

Latin America 

Brazil 

Ecuador 

Asia 

China 

South Korea 

India 

Malaysia 

Philippines 

-9.3% 

-6.4% 

3.3% 

-17.5% 

-2.2% 

-26.0% 

-6.6% 

3.1% 

-18.5% 

-12.3% 

-0.2% 

-6.5% 

-5.0% 

12.0% 

-46.2% 

-6.7% 

8.1% 

-2.9% 

-12.8% 

0.2% 

5.2% 

7.0% 

9.7% 

-2.9% 

-2.5% 

-11.0% 

7.7% 

-0.8% 

1.3% 

-1.8% 

-0.7% (4) 

-3.1% 

-8.8% 

2.1% 

-0.8% 

-2.0% 

-7.8% 

-1.4% 

13.3% 

2.2% 

1.8% 

-1.2% 

1.7% 

4.4% 

1.2% 

3.6% 

0.4% 

1.2% 

-0.8% 

2.0% 

2.4% 

2.7% 

2.8% 

-2.5% 

-8.5% 

7.3% (5) 

3.9% 

3.1% 

-11.1% 

-7.1% 

0.2% 

-26.3% 

-0.1% 

-26.8% 

-8.6% 

-4.7% 

-19.9% 

1.0% 

2.0% 

-4.7% 

-6.2% 

13.7% 

-41.8% 

-5.5% 

11.7% 

-2.5% 

-11.6% 

-0.6% 

7.2% 

9.4% 

12.4% 

-0.1% 

-5.0% 

-19.5% 

15.0% 

3.1% 

4.4% 

Cement domestic markets -4.0% 0.3% -3.7% 

38

Cement: North America 

(1) By destination 




Volumes (1) 12.7 13.6 7% 7% 2.9 3.4 17% 17% 

€m 

Sales (2) 1,189 1,333 12% 3% 260 324 25% 12% 

EBITDA 154 216 40% 23% 29 46 59% 33% 

Current Operating Income 24 79 229% 133% (1) 13 nm nm 

€ 

EBITDA / t 12.1 15.9 


2.0% 

5.9% 

2009 2010 

� Positive volume trends in Canada and in the United 

States helped by higher infrastructure spending 

and stabilization in the residential markets. 

� Prices remained solid in Canada and eroded 

in the United States. 

� Earnings strongly improved due to significant cost 

cutting measures and continued volume growth. 

39

Cement: Western Europe 


MT 2009 2010 Variation 2009 2010 Variation 

Volumes (1) 22.6 20.3 -10% 5.3 4.7 -11% 

€m 

Sales (2) 2,104 1,892 -10% 486 426 -12% 

EBITDA 659 575 -13% 165 106 -36% 

Current Operating Income 507 427 -16% 130 70 -46% 

€ 

EBITDA / t 29.2 28.3 


24.1% 

22.6% 

2009 2010 



� Positive volume trends in the UK with progressive stabilization 

in France and Germany. Spain and Greece continued to suffer 

from the economic environment. 

� Prices resilient overall in a challenging context. 

� Margins in Q4 further impacted by poor weather and lower 

carbon credit sales of an incremental €30M. Year-to-date, 

EBITDA margin remained above 30% due to strict cost cutting 

measures across the region. 

40

Cement: Central And Eastern Europe 





Volumes (1) 11.9 11.1 -7% -7% 2.4 2.4 - - 

€m 

Sales (2) 795 757 -5% -8% 162 170 5% 1% 

EBITDA 303 242 -20% -22% 57 35 -39% -34% 

Current Operating Income 262 193 -26% -27% 47 22 -53% -46% 

€ 

EBITDA / t 25.5 21.8 


33.0% 

25.5% 

2009 2010 

� Volume trends improved over the course of the year with strong 

market trends in Russia and Poland in H2, while Romania still 

suffers from the economic crisis. 

� Prices, while down for the year especially in Poland, improved 

in Q4 versus last year due to positive pricing in Russia. 

� 2010 EBITDA margin was a solid 32%. 

� Q4 current operating income and margins further impacted by 

poor weather and lower carbon credit sales of an incremental 

€8M. 

41

Cement: Middle East and Africa 





Volumes (1) 44.1 40.2 -9% -7% 10.2 10.0 -2% 1% 

€m 

Sales (2) 3,566 3,530 -1% -5% 786 857 9% 4% 

EBITDA 1,304 1,264 -3% -6% 276 330 20% 14% 

Current Operating Income 1,048 1,000 -5% -9% 212 267 26% 16% 

€ 

EBITDA / t 29.6 31.4 


29.4% 

28.3% 

2009 2010 

� Q4 sales increased by 9%, with a positive contribution of most 

markets, the main exception being Jordan. First contribution 

of our new plants in Syria and Uganda. 

� Prices were resilient in a challenging context. 

� 2010 EBITDA margin was at 35.8%;Q4 EBITDA margin was 

at 38.5%, benefiting from higher sales and from the reversal 

of a regulatory fee on past raw materials purchases in Egypt 

of €67M. 

42

Cement: Latin America 





Volumes (1) 7.6 8.4 11% 5% 1.7 2.5 47% 9% 

€m 

Sales (2) 614 722 18% 7% 133 213 60% 13% 

EBITDA 172 228 33% 12% 41 69 68% 11% 

Current Operating Income 140 193 38% 12% 35 58 66% 12% 

€ 

EBITDA / t 22.6 27.1 


22.8% 

26.7% 

2009 2010 

� Organic growth of sales was 13% in the quarter 

and 7% year-to date, driven by positive market trends 

in the region. 

� Pricing improvement. 

� The successful integration of the acquired assets in 

Brazil significantly contributed to the earnings growth. 

� Margins significantly improved due to higher sales, 

contained costs and the level of margins of our new 

assets in Brazil. 

43

Cement: Asia 





Volumes (1) 42.3 42.1 - - 11.1 11.4 3% 3% 

€m 

Sales (2) 1,837 2,046 11% - 461 524 14% -1% 

EBITDA 484 480 -1% -10% 115 109 -5% -17% 


€ 

EBITDA / t 11.4 11.4 


19.7% 

16.5% 

2009 2010 

� Q4 volumes increased 3%, helped by positive 

market trends overall and with the progressive 

contribution of our new capacities. 

� In a challenging environment, prices were resilient in 

most countries outside South Korea, and stabilized 

in China versus Q3 levels. 

� Continuous cost cutting measures partly mitigated 

higher variable costs. 

44

Ciment - Granulats et Béton - Brésil, 

centre administratif gouvernemental 

de l'état de Minas Gerais 

III. Other information 

Aggregates & Concrete Division 

by Product Line and Geographical zone

Pure Aggregates 




Volumes 196.0 193.2 -1% 1% 48.3 48.1 - - 

€m 

Sales (1) 1,907 2,036 7% 2% 455 499 10% 2% 

EBITDA 276 320 16% 9% 74 81 9% - 

Current Operating 

Income 


6.2% 

8.0% 

2009 2010 

118 163 38% 26% 31 39 26% 16% 

� Sales increased by 2% like for like in the fourth 

quarter, supported by positive volume trends in North 

America and in the UK and despite harsh weather 

in December. 

� Overall, price level improved. 

� Continuous tight cost control management 

is reflected in the increase of operating margins, 

together with the improvement 

in prices. 

46

Ready-Mix Concrete 



Mm 3 2009 2010 Variation lfl 2009 2010 Variation lfl 

Volumes 37.1 34.0 -8% -5% 8.6 8.4 -2% -3% 

€m 

Sales (1) 2,920 2,838 -3% -6% 666 696 5% -3% 

EBITDA 146 113 -23% -32% 34 25 -26% -38% 



2.1% 

0.8% 

2009 2010 

� Volumes declined 3% like for like in the fourth quarter 

versus 5% year-to-date, helped by improved volume trends 

in the UK and in North America and despite harsh weather 

in December. 

� Price levels, while down for the year, largely stabilized 

at Q2 levels. 

� Significant cost containment and the contribution of Value 

Added Products partly offset the impact of lower sales. 

47

YTD Sales at December 31, 2010 

Like for Like Sales Variance Analysis by Region and in Major Markets 

Aggregates & Concrete Volume effect Other effects* 

Pure Aggregates 

France 


North America 

South Africa 

Ready-mix Concrete 

France 


North America 

South Africa 

* Other effects: including price effects, product and customer mix effects 

0.9% 

-2.9% 

8.8% 

6.3% 

-34.4% 

-5.0% 

-4.5% 

5.1% 

4.5% 

-23.3% 

0.8% 

0.5% 

2.1% 

0.5% 

4.1% 

-1.2% 

-1.0% 

-2.0% 

-3.3% 

2.4% 

Activity variation 

vs. 2009 

1.7% 

-2.4% 

10.9% 

6.8% 

-30.3% 

-6.2% 

-5.5% 

3.1% 

1.2% 

-20.9% 

48

Aggregates & Concrete 

Additional Information by Geographical Zone 

Volumes (1) 

Pure Aggregates (millions of tonnes) 

Of which Western Europe 

North America 

Other countries 

Ready-mix (millions of m 3 ) 


North America 


Sales (2) (millions of €) 


(2) Before elimination of inter divisional sales by origin 


2009 2010 

196.0 

65.6 

93.8 

36.6 

37.1 

14.1 

6.7 

16.3 

193.2 

61.9 

97.4 

33.9 

34.0 

13.0 

7.1 

13.9 

Var like f/ 

like 

1% 

-5% 

2009 2010 

48.3 

15.6 

24.4 

8.3 

8.6 

3.3 

1.5 

3.8 

48.1 

14.3 

25.1 

8.7 

8.4 

3.0 

1.9 

3.5 

Var like f/ 

like 

Total Aggregates & Concrete 5,067 5,093 -3% 1,173 1,260 -1% 

Of which Pure Aggregates Total 


North America 


Of which Ready-mix Total 


North America 


1,907 

830 

774 

303 

2,920 

1,270 

702 

948 

Current Operating Income (millions of €) 

Total Aggregates & Concrete 193 216 -8% 46 53 -8% 


North America 


94 

18 

81 

62 

96 

58 

23 

12 

11 

4 

39 

10 

2,036 

807 

913 

316 

2,838 

1,181 

793 

864 

2% 

-6% 

455 

189 

197 

69 

666 

296 

164 

206 

499 

185 

232 

82 

696 

275 

203 

218 

49 

- 

-3% 

2% 

-3%

Plätre- Afrique du Sud, immeuble de 

Johannesburg 

IV. Other information 

Gypsum division by Geographical zone

Gypsum 

Additional Information by Geographical Zone 

Volumes 

(1) Before elimination of inter divisional sales by origin 


2009 2010 

Var like f/ 

like 

2009 2010 

Var like f/ 

like 

Total Boards (millions of m²) 667 690 3% 165 173 5% 

Sales (1) (millions of €) 

Total Gypsum 1,355 1,441 2% 320 351 4% 


North America 


762 

180 

413 

Current Operating Income (millions of €) 

Total Gypsum 38 58 42% (4) 10 nm 


North America 


48 

(43) 

33 

753 

184 

504 

58 

(46) 

46 

175 

40 

105 

4 

(13) 

5 

180 

42 

129 

13 

(13) 

10 

51



V. Other Information 

Income statement

Other Income (Expenses) 


€m 2009 2010 2009 2010 

Net gains (losses) on disposals 103 45 41 (5) 

Impairment of assets (164) (1) (154) (2) (123) (1) (60) 

Restructuring (155) (122) (83) (63) 

Others (11) (41) (44) 1 

Total (227) (272) (209) (127) 

(1) Of which 90 million euros impairment loss recognized on cement assets in Western Europe 

(2) Mostly comprise impairment loss on assets located in Western Europe and South Korea and closure costs of a paper plant in Sweden 

53

Finance Costs and Average Interest rate 


Finance Costs in €m 2009 2010 2009 2010 

Financial charges on net debt (760) (773) (174) (193) 

Foreign exchange (37) (26) (31) (2) 

Others (129) 76 (1) (43) (29) 

Total (926) (723) (248) (224) 

December 31, 2009 December 31, 2010 

Average interest rate Interest rate Interest rate 

Spot Average Spot Average 

Total gross debt (2) €15.7 Bn 5.3% 5.1% €17.0 Bn 5.5% 5.3% 

Of which: Fixed rate 68% 6.3% 66% 6.7% 

Floating rate 32% 2.9% 34% 3.1% 

(1) Including gain on disposal of Cimpor for €161m 

(2) Excluding puts: €0.3Bn 

54



VI. Other Information 

Statement of Financial Position (1) Statement of Financial Position & Cash Flow Statement 

(1) & Cash Flow Statement 

(1) Former Balance sheet

Statement of Financial position (1) 

€m 

Capital Employed 

Out of which: 

Goodwill 

Prop, plant & equip. 

Working Capital 

Other 

Dec. 

31, 2009 

31,836 

13,249 

16,699 

921 

967 

Dec. 

31, 2010 

33,762 

14,327 

17,912 

440 

1,083 

Financial assets 1,591 863 

Total 33,427 34,625 

(1) Former balance sheet 

€m 

Equity 

Out of which: 

Shareholders’ equity 

Non controlling 

interests 

Dec. 

31, 2009 

16,800 

14,977 

1,823 

Dec. 

31, 2010 

18,224 

16,144 

2,080 

Net debt 13,795 13,993 

Provisions 2,832 2,408 

Total 33,427 34,625 

56

Investments and Divestments 


€m 2009 2010 2009 2010 

Sustaining capital expenditures 372 359 173 173 

Development capital expenditures 1,234 950 308 155 

Acquisitions 115 84 30 43 

Capital expenditure 1,721 1,393 511 371 

Divestments (1) 919 364 (2) 286 78 

(1) Including the non controlling interests’ share in capital increase of subsidiaries, mainly composed of EBRD additional investment 

in our cement operations in Eastern Europe and the gross debt disposed of as part of the divested operations 

(2) Including the divestment of a minority stake in Lafarge Malayan Cement Berhad for €141m in Q3 2010 

57

Gross Debt (1) by Currency 

and by Source of Financing as at December 31 

USD 

€bn 4.0 

24% 

GBP 

€bn 0.8 

5% 

Split by currency 

CNY 

€bn 0.4 

3% 

Other 

€bn 1.3 

7% 

EUR 

€bn 10.5 

61% 

Total Gross Debt (1) : €17.0Bn 

(1) Excluding puts: €0.3Bn 

Commercial 

paper 

4% 

€bn 0.7 

Split by source of financing 

Banks and 

others 

25% 

€bn 4.3 

Notes / Private 

placements 

4% 

€bn 0.7 

Debentures 

67% 

€bn 11.3 

58

Key definitions 

Volumes Volumes are shown by destination 

Sales by Division 

EBITDA 

Current Operating Income 

Sales by Division are disclosed by origin, and before 

elimination of inter divisional sales 

Current Operating Income before depreciation and 

amortization 

Operating Income before “capital gains, impairment, 

restructuring and other” 

Operating margin Current Operating Income / Sales 

Free Cash Flow 

Like for Like variation 

Net operating cash flow generated by continuing operations 

less sustaining capital expenditures 

Like for Like variation corresponds to the variation 

at constant scope and exchange rates 

Strict Working Capital Trade receivables plus inventories less trade payables 

Strict Working Capital 

in days sales 

Strict Working Capital end of N * 90 days 

Sales of the last quarter 

59

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