PARIS, February 24, 2011 /PRNewswire-FirstCall/ -- Publication of sales
for the fourth quarter of 2010 and of results for the year ended December 31,
2010.
KEY FIGURES 2009 2010 Change
2010/2009
(EURm)
Sales 37,786 40,119 +6.2%
Operating income 2,216 3,117 +41%
Recurring net income(1) 617 1,335 +116%
Net income 202 1,129 +459%
2010 dividend: EUR1.15 (up 15%), paid entirely in cash Results of 2010 action plan:
- Sales prices: up 0.8% over the year; up 1.4% over the second
half
- Cost savings: EUR600m over the year; EUR2.1bn in the second half
- Strong growth in operating income (at constant exchange rates*):
up 33.7%, with second-half operating income significantly outperforming
(up 15.7%) the first-half figure
- Free cash flow(2): up 51% to EUR1.5bn, despite the rise in
capex
- Ongoing fall in net debt: EUR1.4bn of net debt paid down over 12
months; gearing ratio cut to 39% of equity
Pierre-Andre de Chalendar, Chairman and Chief Executive Officer of Saint-Gobain, commented:
"In 2010, in a global economy still recovering from the crisis, our sales volumes got back on an upward trend and our priority focus on sales prices paid off. We delivered a sharp upswing in our results, driven in particular by the significant cost savings achieved over the past few years.
Overall in 2011, we expect to see more upbeat trading conditions in our key markets (particularly new-build and renovation markets in Europe). Nevertheless, we will see a sharp rise in raw material and energy costs that we will endeavor to limit by pursuing our priority focus on raising sales prices. Against this backdrop, Saint-Gobain is targeting robust organic growth and double-digit growth in operating income** for 2011.
Leveraging its financial strength, the Group will resolutely adopt a tempered development policy to boost this return to growth. It will step up its capital expenditure and financial investments, targeting emerging countries and high value-added Habitat solutions. Given an increase in its capital expenditure of EUR500 million in 2011, Saint-Gobain is targeting free cash flow of EUR1.3 billion."
* Exchange rates for 2009.
** Exchange rates for 2010.
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.
Operating performance
Against the backdrop of a global economy still recovering from the crisis, the Group returned to growth in 2010, reporting a 1.9% increase in like-for-like sales (comparable Group structure and exchange rates). This performance was driven by robust momentum in emerging countries and Asia and by vigorous trading in industrial markets. Construction markets remained rather sluggish on the whole in North America, but improved steadily over the year in both Western and Eastern Europe, and particularly in the UK, Germany and Scandinavia (which represent almost half of the Group's construction sales in Western Europe). Household consumption remained relatively stable over the year.
Overall, the Group reported 1.9% organic growth for 2010, breaking down as 1.0% growth in the first half (positive volume and price impacts of 0.9% and 0.1%, respectively), and 2.8% growth in the second half (with both volumes and prices up 1.4%). Despite severe weather conditions in Europe at the end of the year, organic growth accelerated between the third and fourth quarters, from 2.3% to 3.3%. Sales prices held firm over the year in all Business Sectors, offsetting the rise in the cost of raw materials and energy at Group level.
Against this backdrop, Saint-Gobain resolutely implemented all of its action plan priorities and outperformed each of its targets:
- sales prices were increased by 1.4% in the second half and
by 0.8% over the year;
- costs were slashed by EUR600 million, driving a sharp 40.7%
increase in operating income, which came in 15.7% higher in the second
half than in the six months to June 30, 2010. The Group's operating
margin widened sharply, up to 7.8% of sales from 5.9% in 2009. In the
second half, the operating margin came in at 8.1%, outperforming its
second-half 2008 level (7.6%), even though sales volumes remained 9.4%
below their level in the second half of 2008;
- the Group generated EUR1.5 billion in free cash flow and
further reduced net debt by EUR1.4 billion, thereby reinforcing its
cash resources and strong financial structure.
1) Performance of Group Business Sectors
Innovative Materials delivered the Group's best organic growth performance, at 12.3%. The Business Sector reported double-digit growth in both the first and second halves of 2010, despite a much tougher basis for comparison over the six months to December 31. Markets related to industrial output confirmed their recovery throughout the year, both in North America and Western Europe. The Sector was also buoyed by very strong 21.6% organic growth over the year in Asia and emerging countries, which represent 37.6% of its sales. Together with the impact of the Group's cost savings programs, this helped drive a steep rise in the Sector's operating margin, which came in at 11.0% compared with 4.7% in 2009. The operating margin for the second half was 11.6% (6.7% in second-half 2009), ahead of the 11.5% achieved in second-half 2008.
- Flat Glass reported an 8.4% rise in like-for-like sales over the year,
spurred by vigorous growth in Asia and emerging countries (41.5% of
Flat Glass sales), as well as the strong rebound in worldwide
automotive output. Sales of Flat Glass for the building industry in
Western Europe picked up gradually as from the second quarter in
Germany, France and Italy, but remained slack in other countries. Sales
prices for the Flat Glass Sector as a whole got back on an upward trend
in the second half, thanks largely to the increase in commodity prices
(float glass) in Europe. All of these factors, together with the cost
savings achieved, pushed the operating margin up to 8.4% of sales (9.0%
in the second half and 7.8% in the first), far more than double the
figure for 2009 (3.4% of sales).
- High-Performance Materials (HPM) like-for-like sales surged 17.9% over
the year and 16.8% in the second half. Overall, industrial output and
capital expenditure remained upbeat throughout the year, significantly
picking up pace in both Western and Eastern Europe during the second
half. Consequently, although HPM like-for-like sales remained below
their pre-crisis level, upbeat sales prices and fixed cost savings
provided the operating margin with very strong operating leverage,
putting it back on a par with previous record levels, at 14.3% of sales
in 2010 (compared with 6.6% of sales in 2009), and 15.1% of sales in
the second half.
Like-for-like sales for the Construction Products (CP) Business Sector remained stable over the year as a whole and in the second half, with improved second-half trading conditions in Western and Eastern Europe offset by the fall in sales in the United States (due to inventory run-downs by distributors in the third quarter). However, Construction Products sales improved further in the fourth quarter (up 3.7%) across all regions, and particularly Eastern Europe. The Business Sector's operating margin continued to rise, up to 9.7% from 9.5% in 2009, bolstered by the cost savings achieved and upbeat sales prices - particularly in the six months to December 31.
- Like-for-like Interior Solutions sales slipped 1.8% over 2010, despite
an 0.1% advance in the second half of the year driven by the fledgling
recovery in Western and Eastern Europe and healthy sales prices.
Markets in Asia and Latin America continued to enjoy robust growth
throughout the year, while US construction markets remained in the
doldrums. The operating margin continued to improve, up to 7.3% in 2010
(7.7% in the second half) versus 6.8% in 2009.
- Like-for-Like Exterior Solutions sales edged up 1.7% over the year,
bolstered by a further rise in sales prices for all of its components
(Industrial Mortars, Exterior Products and Pipe). Sales volumes were
Broadly stable for 2010 as a whole, with vibrant trading in Asia and
Latin America offset by a slowdown in business in both Western and
Eastern Europe. Trading conditions in North America remained sluggish.
However, fourth-quarter volumes were up sharply across the business,
particularly in Eastern Europe. The operating margin repeated its good
2009 performance, coming in at 11.8% of sales despite the hike in raw
material costs - especially in the second half.
Building Distribution saw a slight 1.5% decline in year-on-year trading, due to ongoing tough conditions in the first half. The Business Sector got back on the growth track in the second half of 2010 (up 1.0%), despite severe weather conditions at the end of the year. This uptrend was chiefly fueled by a gradual recovery in Germany, the UK and Scandinavia as from March (each of these countries delivering robust growth in the second half of the year). Trading in France was slightly down over the year as a whole, despite picking up in the six months to December 31. The downturn continued across Southern Europe and the United States, in spite of more favorable comparative figures. The operating margin for the Business Sector improved, up to 3.3% of sales (4.2% in the second half) from 2.4% of sales in the year-earlier period, mainly reflecting the impacts of streamlining measures, cost savings and a higher gross margin.
Packaging (Verallia) continued to report robust trading conditions and earnings, which remained virtually stable year-on-year. Nevertheless, the Business Sector's operating margin narrowed slightly to 12.2% of sales (12.7% of sales in 2009), with the sharper rise in sales prices in the second half failing to fully offset, over the year as a whole, the slowdown in volumes across Europe and to a lesser extent, the rise in energy costs.
2) Analysis by geographic area
In 2010 as well as the six months to December 31, 2010, the Group's organic growth performance continued to be led by Asia and emerging countries, which delivered double-digit organic growth over both periods. However, business in North America and Western Europe began to improve overall, with trading picking up pace in Western Europe in the second half of the year.
Profitability improved sharply across all regions.
- In France, trading was close to 2009 levels, in spite of a particularly
weak performance in the first quarter due to very cold winter weather.
Despite a gradual improvement over the year, construction markets
Remained relatively tough. In contrast, industrial markets proved
fairly upbeat. The operating margin for France improved sharply, up to
6.3% from 5.5% in 2009.
- Like-for-like sales in other Western European countries remained stable
over the year, with modest 2.1% growth in the second half more than
offsetting the 1.7% contraction in the six months to June 30.
Construction markets confirmed their gradual recovery throughout the
second half, led by a stronger growth momentum in Germany and
Scandinavia and a relative improvement in Spain. Thanks to the cost
savings achieved since the onset of the crisis, the operating margin
for the region surged to 5.9% (6.7% in the second half), compared to
4.4% in 2009 (5.6% in the six months to December 31, 2009).
- Trading in emerging countries and Asia (18.7% of Group sales) remained
vigorous, with organic growth picking up pace in the second half (up to
13.0% from 9.6% in the six months to June 30). This performance came on
the back of a return to growth in Central and Eastern Europe, and
particularly Poland. Asia and Latin America continued to deliver a
strong organic growth performance (up 17.3%) throughout the year. The
operating margin rose sharply, up to 10.1% of sales (10.9% in the
second half) from 6.7% one year earlier (8.5% in second-half 2009).
- North America posted organic growth of 6.5% for the year (1.7% in the
second half and 5.2% in the fourth quarter), bolstered by a sharp
rebound in businesses related to industrial output and a good
performance from all other businesses except Interior Solutions, which
suffered from continuing weakness in construction markets. The region's
operating margin - also boosted by the restructuring measures
implemented - continued to improve, up to 10.7% of
sales (8.9% of sales in 2009), despite inventory run-downs by
distributors in the third quarter and the rise in the cost of raw
materials in the second half.
2010 consolidated financial statements
The Group's 2010 consolidated financial statements and the financial statements of the Group's parent company, Compagnie de Saint-Gobain, were approved and adopted by Saint-Gobain's Board of Directors at its meeting of February 24, 2011. These financial statements have been audited by the Statutory Auditors. Key consolidated data are summarized below:
2009 2010 %
EURm EURm change
Sales and ancillary revenue 37,786 40,119 +6.2%
Operating income 2,216 3,117 +40.7%
Operating depreciation and amortization 1,514 1,535 +1.4%
EBITDA (op. inc. + operating 3,730 4,652 +24.7%
depreciation/amortization)
Non-operating costs (596) (446) -25.2%
Capital gains and losses on disposals, asset
write-downs, (380) (147) -61.3%
corporate acquisition fees and earn-out payments
Business income 1,240 2,524 +103.5%
Net financial expense (805) (739) -8.2%
Income tax (196) (577) +194.4%
Share in net income of associates 2 5 +150.0%
Income before minority interests 241 1,213 +403.3%
Minority interests (39) (84) +115.4%
Recurring net income(1) 617 1,335 +116.4%
Recurring(1) earnings per share(2) (in EUR) 1.20 2.51 +109.2%
Net income 202 1,129 +458.9%
Earnings per share(2) (in EUR) 0.39 2.13 +446.1%
Cash flow from operations(3) 2,303 3,004 +30.4%
Cash flow from operations excluding capital gains
tax(4) 2,268 2,987 +31.7%
Capital expenditure 1,249 1,450 +16.1%
Free cash flow (excluding capital gains tax)(4) 1,019 1,537 +50.8%
Investments in securities 204 129 -36.8%
Net debt 8,554 7,168 -16.2%
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 December 31 (530,836,441 shares in 2010 versus 512,931,016 shares in 2009). Based on the weighted average number of shares outstanding (517,954,691 shares in 2010 versus 473,244,410 in 2009), recurring earnings per share comes out at EUR2.58 (versus EUR1.30 in 2009), and earnings per share comes out at EUR2.18 (versus EUR0.43 in 2009).
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 6.2%, powered by a strong 3.9% positive currency impact. This reflects the appreciation against the euro of most currencies of the other monetary areas where the Group trades, namely Scandinavian and emerging country currencies (especially the Brazilian real). On a constant exchange rate basis*, sales therefore climbed 2.3%. Changes in Group structure had a mild +0.4% impact on sales. Like-for-like, Group sales moved up 1.9% (including a positive 1.1% volume impact and a positive 0.8% price effect), reflecting the acceleration in organic growth over the second half of the year, up to 2.8% (of which 3.3% in the fourth quarter), after 1.0% in the six months to June 30.
In line with targets, the Group's operating income rose sharply, up 40.7% (33.7% at constant exchange rates), powered mainly by the cost savings achieved. As a result, the operating margin improved significantly, up to 7.8% of sales (10.7% excluding Building Distribution), versus 5.9% (8.4% excluding Building Distribution) in 2009.
The Group outperformed its target in the second half of 2010 ("operating income for second-half 2010 slightly above the first half"), with a rise of 15.7% in operating income compared to first-half 2010 and of 30.0% compared to second-half 2009.
The Group's second-half operating margin rose steeply, up to 8.1% of sales (10.8% excluding Building Distribution), versus 6.7% of sales (9.1% excluding Building Distribution) in second-half 2009. It also came in higher than in second-half 2008 (7.6%, or 9.8% excluding Building Distribution), even though sales volumes remained 9.4% below the volumes recorded in that period.
EBITDA (operating income + operating depreciation and amortization) surged 24.7%. The consolidated EBITDA margin came in at 11.6% of sales (16.1% excluding Building Distribution), versus 9.9% (14.1% excluding Building Distribution) in 2009.
The consolidated EBITDA margin in the six months to December 31, 2010 exceeded its second-half 2008 level, at 11.8% versus 11.1%.
Non-operating costs fell 25.2% to EUR446 million (EUR596 million in 2009), thanks to lower restructuring costs. This amount includes a EUR97 million accrual to the provision for asbestos-related litigation involving CertainTeed in the US, the increase compared to 2009 reflecting the rise in indemnities paid over the last 12 months (see "Update on asbestos claims in the US" on page 7).
The net balance of capital gains and losses on disposals, asset write-downs and corporate acquisition fees was a negative EUR147 million. This amount comprises EUR87.1 million in capital gains (including the capital gain on the disposal of Advanced Ceramics) and EUR232.2 million in asset write-downs. These write-downs result primarily from restructuring plans and site closures initiated during the period. They include a EUR72 million write-down taken against part of the goodwill relating to certain Building Distribution businesses in the US and the Netherlands following restructuring measures launched in these companies in 2010.
Business income totaled EUR2,524 million in 2010, twice the figure for 2009 after taking into account the items mentioned above (non-operating costs, capital gains/losses on disposals and asset write-downs).
Net financial expense improved slightly, at EUR739 million versus EUR805 million in 2009. This chiefly reflects the reduction in net debt. The average cost of net debt came out at 5.6% in 2010, versus 5.5% in 2009.
Income tax rose sharply, up from EUR196 million to EUR577 million, chiefly due to the rise in pre-tax income and, to a lesser extent, the business tax reform introduced in France as of January 1, 2010, which led the Group to reclassify the new CVAE ("Cotisation sur la Valeur Ajoutee des Entreprises") tax as income tax.
Recurring net income (excluding capital gains and losses, asset write-downs and material non-recurring provisions) jumped 116.4% year-on-year, to EUR1,335 million. Based on the number of shares outstanding at December 31, 2010 (530,836,441 shares versus 512,931,016 shares at end-2009), recurring earnings per share came out at EUR2.51, up 109.2% on 2009 (EUR1.20).
Net income came in at EUR1,129 million, more than five times higher than the 2009 figure (EUR202 million). Based on the number of shares outstanding at December 31, 2010 (530,836,441 shares versus 512,931,016 shares at December 31, 2009), earnings per share came out at EUR2.13, more than five times higher than in 2009 (EUR0.39).
* Based on average exchange rates for 2009.
Capital expenditure climbed 16.1% to EUR1,450 million (versus EUR1,249 million in 2009), and accounted for 3.6% of sales (3.3% in 2009). This increase was mainly attributable to the upturn (especially in the second half) in growth capex focused on activities related to energy efficiency (Flat Glass - including solar power - and Construction Products) and on Asia and emerging countries. Overall, these markets accounted for almost 80% of the Group's total growth capex in 2010.
Cash flow from operations totaled EUR3,004 million in 2010, up 30.4% on the same period in 2009. Before the tax impact of capital gains and losses on disposals and asset write-downs, cash flow from operations climbed 31.7% to EUR2,987 million, up from EUR2,268 million one year earlier.
Free cash flow (cash flow from operations less capital expenditure) jumped 47.4% to EUR1,554 million, despite the rise in capital expenditure. Before the tax impact of capital gains and losses on disposals and asset write-downs, free cash flow surged 50.8% to EUR1,537 million, or 3.8% of sales (2.7% of sales in 2009). The Group therefore outperformed its target for full-year 2010 (initially EUR1 billion in free cash flow, subsequently raised to EUR1.4 billion in July).
In second-half 2010, despite the robust 38.5% increase in capital expenditure, free cash flow totaled EUR550 million (before the tax impact of capital gains and losses on disposals and asset write-downs). It advanced 17.2% compared to second-half 2009 (EUR469 million), which already stood as the Group's best second-half level of free cash flow over the last five years. This reflects the ongoing focus on cash flow management, including in a more upbeat growth environment.
The difference between EBITDA and capital expenditure increased 29% to EUR3,202 million in 2010, versus EUR2,481 million in 2009, representing 8.0% of sales (6.6% one year earlier).
After seven years of continuous improvements, operating working capital requirements (WCR) stabilized at a very good 31 days' sales at December 31, 2010, despite the trading upturn and the negative impact of the LME ("Loi de Modernisation de l'Economie") law in France.
Investments in securities totaled EUR129 million and primarily related to acquisitions focused on energy efficiency, solar power and emerging countries. In the second half of 2010, the Building Distribution Sector resumed its policy of bolt-on acquisitions in Europe, especially in Scandinavia.
Net debt stood at EUR7.2 billion at December 31, 2010. After an already sharp EUR3.1 billion reduction in 2009, net debt was reduced by a further EUR1.4 billion (16.2%) compared to December 31, 2009 (EUR8.6 billion), spurred essentially by the increase in free cash flow. Net debt came out at 39% of shareholders' equity, compared with 53% at December 31, 2009. The net debt to EBITDA ratio came out at 1.5, a significant improvement on a year earlier (2.3).
Update on asbestos claims in the US
Some 5,000 claims were filed against CertainTeed in 2010, compared with 4,000 in 2009. Over the year, 13,000 claims were settled (versus 8,000 in 2009), bringing the total number of outstanding claims to 56,000 at December 31, 2010, versus 64,000 at December 31, 2009.
Confirming the trends observed at the end of June 2010, a total of USD 103 million in indemnity payments were made in the 12 months to December 31, 2010, up from USD 77 million in the year-earlier period.
In light of these trends, and particularly the rise in indemnity payments, an additional provision of EUR97 million was accrued in 2010 (EUR75 million in 2009), bringing the total coverage for CertainTeed's asbestos-related claims to around USD 501 million at December 31, 2010, virtually stable compared to December 31, 2009 (USD 500 million).
2010 action plan: results ahead of targets
The Group resolutely implemented its action plan priorities during the year and outperformed its 2010 targets.
In 2010, Saint-Gobain:
- Continued to give clear operating priority to sales prices,
which rose 0.8% over the year (1.4% in the second half). The spread
between sales prices and raw material and energy costs therefore had a
positive impact on the year;
- Implemented and extended the cost cutting program:
- EUR600 million in additional cost savings were unlocked in
2010 compared with 2009, including EUR150 million in the second half,
bringing the total cost savings realized between 2007 and 2010 to
EUR2.1 billion.
- Continued to optimize free cash flow, by:
- generating EUR1.5 billion in free cash flow(1), ahead of the
target set in July (EUR1.4 billion, raised from an initial target of
EUR1.0 billion), despite the increase in capital expenditure,
- maintaining a tight rein on operating working capital
requirements (WCR), which remained at 31 days' sales despite the
negative impact of the LME law and the increase in sales.
- Thanks to these measures, the Group paid down net debt by a
further EUR1.4 billion, and again strengthened its balance sheet: the
gearing ratio has been slashed to 39% from 53% at end-December 2009,
while the net debt to EBITDA ratio fell to 1.5.
- At the same time, the Group resumed its selective
acquisitions and development policy, focusing on fast-growing
businesses and/or regions. It:
- increased its capital expenditure by 16% to EUR1,450 million
(including a rise of 38.5%, or EUR1,018 million in the second half),
with most growth capex earmarked for emerging countries and for energy
efficiency and solar power markets;
- gradually resumed its policy of bolt-on acquisitions, with
selective transactions also focused on energy efficiency, solar power
and emerging countries.
1. Excluding the tax impact of capital gains and losses on disposals, asset write-downs and material non-recurring provisions.
2011-2015 Strategy
Leveraging its very robust financial structure and significantly leaner cost base, the Group intends to pursue a profitable growth and expansion strategy over the next few years, with the aim of becoming the reference in sustainable Habitat. This strategy will chiefly involve:
- the gradual divestment of Packaging (Verallia), with the
process for minority flotation as from second-quarter 2011 launched on
October 13;
- bolstering the Group's positioning in high value-added
solutions for the Habitat market, so that high value-added solutions
represent 60% of the Group's sales by 2015 (compared to 51% currently);
- accelerating the Group's expansion in Asia and emerging
countries, with the aim of these regions accounting for 26% of the
Group's sales by 2015 (versus 19% currently).
This strategy will be underpinned by a constant focus on profitability
and strong financial discipline, in order to achieve the Group's ambitious
targets by 2015, namely:
Sales EUR55bn
Operating income EUR5.5bn
(10% of sales)
Recurring net income EUR3bn
ROI* (Return on investment) 25%
ROCE* (Return on capital employed) 14-15%
* Before tax
Outlook and objectives for 2011
2010 saw the Group emerge from the crisis and gradually return to growth. Overall in 2011, the Group expects more upbeat trading conditions in its main markets. However, trends will continue to vary widely from one region to the next:
- Asia and emerging countries should see ongoing vigorous
growth, with the recovery in Eastern Europe (especially Poland) picking
up pace.
- In North America, industrial markets should continue to
enjoy strong momentum. In contrast, construction markets are likely to
remain sluggish, although some signs of recovery could emerge during
the year.
- In Western Europe, trading on industrial markets should
remain brisk, while construction markets should continue to recover,
particularly new-build and renovation segments. This overall
improvement should nevertheless conceal continuing stark contrasts from
one country to the next: the Group's key markets (France, Germany, UK,
Scandinavia) should continue to recover, while Southern Europe will
remain challenging.
- Lastly, household consumption markets should hold firm
across all regions.
Against this backdrop, all of the Group's Business Sectors should benefit from a favorable growth momentum.
To support the return to growth on its main markets, the Group will resolutely adopt a tempered development policy in 2011, underpinned by a constant focus on profitability and strict financial discipline. Saint-Gobain will:
- resume a dynamic but selective and tempered investment
policy (capex and financial investments) anchored around the Group's
main growth drivers (emerging countries, energy efficiency, solar
power), supported by a strong financial structure. Along the lines of
2010, these markets should account for more than 80% of the Group's
growth capex in 2011;
- continue to give priority to sales prices and endeavor to
pass on the rising cost of raw materials and energy to sales prices,
amid rising inflation;
- continue to maintain a tight rein on costs;
- continue to keep a close watch on cash management and
financial strength;
- maintain its R&D efforts.
For 2011, the Group is therefore targeting:
- robust organic growth, with a bullish first quarter thanks
chiefly to very weak comparative figures;
- double-digit growth in operating income (at constant
exchange rates*), despite the rise in energy and raw material costs;
- free cash flow of EUR1.3 billion, after the EUR500 million
increase in capex;
- a persistently robust financial structure.
* Average exchange rates for 2010.
In terms of dividend policy, at its meeting of February 24, Compagnie de Saint-Gobain's Board of Directors decided to recommend to the June 9, 2011 Shareholders' Meeting a dividend payout of EUR605 million**, representing 45% of recurring net income and 54% of net income, i.e. a dividend of EUR1.15 per share, up 15% on the 2009 dividend. Based on the closing share price at December 31, 2010 (EUR38.50), this represents a dividend yield of 3.0%. The dividends will be paid entirely in cash on June 16, 2011, with the ex-coupon date scheduled for June 13, 2011.
* The dividend amount is based on the number of shares carrying dividend rights on January 31, 2011.
Forthcoming results announcement
- Sales for the first quarter of 2011: April 28, 2011, after close of
trading on the Paris Bourse.
Appendix 1: Results by business sector and geographic area - Full Year
change on change on change on a
I. SALES 2009 2010 an actual a comparable
comparable
(in EUR m) (in EUR structure structure structure
m) and
basis basis currency
basis
by sector and
division:
Innovative
Materials (1) 7.792 9.283 +19.1% +18.7% +12.3%
Flat Glass 4.572 5.218 +14.1% +14.3% +8.4%
High-Performance
Materials 3.240 4.088 +26.2% +25.0% +17.9%
Construction
Products (1) 10.414 10.940 +5.1% +4.3% +0.0%
Interior Solutions 5.034 5.195 +3.2% +2.1% -1.8%
Exterior Solutions 5.413 5.781 +6.8% +6.5% +1.7%
Building
Distribution 17.101 17.326 +1.3% +1.1% -1.5%
Packaging 3.445 3.553 +3.1% +3.1% +0.2%
Internal sales and
misc. -966 -983 n.m. n.m. n.m.
Group Total 37.786 40.119 +6.2% +5.8% +1.9%
(1) including intra-sector
eliminations
by geographic area:
France 11.495 11.388 -0.9% -1.0% -1.0%
Other Western
European countries 16.557 17.063 +3.1% +2.9% +0.2%
North America 4.864 5.516 +13.4% +12.5% +6.5%
Emerging countries
and Asia 6.377 7.983 +25.2% +23.8% +11.4%
Internal sales -1.507 -1.831 n.m. n.m. n.m.
Group Total 37.786 40.119 +6.2% +5.8% +1.9%
change on
II. OPERATING 2009 2010 an actual 2009 2010
INCOME
(in EUR m) (in EUR structure (in % of (in % of
m) sales) sales)
basis
by sector and
division:
Innovative
Materials 370 1.024 +176.8% 4.7% 11.0%
Flat Glass 155 439 +183.2% 3.4% 8.4%
High-Performance
Materials 215 585 +172.1% 6.6% 14.3%
Construction
Products 985 1.064 +8.0% 9.5% 9.7%
Interior Solutions 344 379 +10.2% 6.8% 7.3%
Exterior Solutions 641 685 +6.9% 11.8% 11.8%
Building
Distribution 412 578 +40.3% 2.4% 3.3%
Packaging 437 434 -0.7% 12.7% 12.2%
Misc. 12 17 n.m. n.m. n.m.
Group Total 2.216 3.117 +40.7% 5.9% 7.8%
by geographic area:
France 629 714 +13.5% 5.5% 6.3%
Other Western
European countries 730 1.007 +37.9% 4.4% 5.9%
North America 432 590 +36.6% 8.9% 10.7%
Emerging countries
and Asia 425 806 +89.6% 6.7% 10.1%
Group Total 2.216 3.117 +40.7% 5.9% 7.8%
change on
III. BUSINESS 2009 2010 an actual 2009 2010
INCOME
(in EUR m) (in EUR structure (in % of (in % of
m) sales) sales)
basis
by sector and
division:
Innovative
Materials 70 883 +1161.4% 0.9% 9.5%
Flat Glass -46 289 +728.3% -1.0% 5.5%
High-Performance
Materials 116 594 +412.1% 3.6% 14.5%
Construction
Products 639 928 +45.2% 6.1% 8.5%
Interior Solutions 59 305 +416.9% 1.2% 5.9%
Exterior Solutions 580 623 +7.4% 10.7% 10.8%
Building
Distribution 250 403 +61.2% 1.5% 2.3%
Packaging 395 404 +2.3% 11.5% 11.4%
Misc. -114 (a) -94 (a) n.m. n.m. n.m.
Group Total 1.240 2.524 +103.5% 3.3% 6.3%
by geographic area:
France 462 607 +31.4% 4.0% 5.3%
Other Western
European countries 358 779 +117.6% 2.2% 4.6%
North America 64 (a) 422 (a) +559.4% 1.3% 7.7%
Emerging countries
and Asia 356 716 +101.1% 5.6% 9.0%
Group Total 1.240 2.524 +103.5% 3.3% 6.3%
(a) after asbestos-related charge (before tax) of EUR75m in 2009 and
EUR97m in 2010
change on
IV. CASH FLOW 2009 2010 an actual 2009 2010
(in EUR m) (in EUR structure (in % of (in % of
m) sales) sales)
basis
by sector and
division:
Innovative
Materials 385 958 +148.8% 4.9% 10.3%
Flat Glass 170 505 +197.1% 3.7% 9.7%
High-Performance
Materials 215 453 +110.7% 6.6% 11.1%
Construction
Products 659 834 +26.6% 6.3% 7.6%
Building
Distribution 283 447 +58.0% 1.7% 2.6%
Packaging 492 488 -0.8% 14.3% 13.7%
Misc. 484 (a) 277 (a) n.m. n.m. n.m.
Group Total 2.303 3.004 +30.4% 6.1% 7.5%
by geographic area:
France 527 431 -18.2% 4.6% 3.8%
Other Western
European countries 797 1.167 +46.4% 4.8% 6.8%
North America 451 (a) 501 (a) +11.1% 9.3% 9.1%
Emerging countries
and Asia 528 905 +71.4% 8.3% 11.3%
Group Total 2.303 3.004 +30.4% 6.1% 7.5%
(a) after asbestos-related charge (after tax) of EUR46m in 2009
versus EUR59m in 2010
change on
V. CAPITAL 2009 2010 an actual 2009 2010
EXPENDITURE
(in EUR m) (in EUR structure (in % of (in % of
m) sales) sales)
basis
by sector and
division:
Innovative
Materials 456 562 +23.2% 5.9% 6.1%
Flat Glass 326 413 +26.7% 7.1% 7.9%
High-Performance
Materials 130 149 +14.6% 4.0% 3.6%
Construction
Products 364 422 +15.9% 3.5% 3.9%
Interior Solutions 199 194 -2.5% 4.0% 3.7%
Exterior Solutions 165 228 +38.2% 3.0% 3.9%
Building
Distribution 155 187 +20.6% 0.9% 1.1%
Packaging 259 261 +0.8% 7.5% 7.3%
Misc. 15 18 n.m. n.m. n.m.
Group Total 1.249 1.450 +16.1% 3.3% 3.6%
by geographic area:
France 254 290 +14.2% 2.2% 2.5%
Other Western
European countries 414 427 +3.1% 2.5% 2.5%
North America 167 201 +20.4% 3.4% 3.6%
Emerging countries
and Asia 414 532 +28.5% 6.5% 6.7%
Group Total 1.249 1.450 +16.1% 3.3% 3.6%
VI. EBITDA change on
2009 2010 an actual 2009 2010
(in EUR m) (in EUR structure (in % of (in % of
m) sales) sales)
basis
by sector and
division:
Innovative
Materials 843 1.506 +78.6% 10.8% 16.2%
Flat Glass 444 746 +68.0% 9.7% 14.3%
High-Performance
Materials 399 760 +90.5% 12.3% 18.6%
Construction
Products 1.494 1.584 +6.0% 14.3% 14.5%
Interior Solutions 672 711 +5.8% 13.3% 13.7%
Exterior Solutions 822 873 +6.2% 15.2% 15.1%
Building
Distribution 698 851 21.9% 4.1% 4.9%
Packaging 657 669 +1.8% 19.1% 18.8%
Misc. 38 42 n.m. n.m. n.m.
Group Total 3.730 4.652 +24.7% 9.9% 11.6%
by geographic area:
France 1.013 1.085 +7.1% 8.8% 9.5%
Other Western
European countries 1.282 1.547 +20.7% 7.7% 9.1%
North America 674 832 +23.4% 13.9% 15.1%
Emerging countries
and Asia 761 1.188 +56.1% 11.9% 14.9%
Group Total 3.730 4.652 +24.7% 9.9% 11.6%
Appendix 2: Results by business sector and geographic area - Second
Half
H2 H2 change on change on change on a
I. SALES 2009 2010 an actual a comparable
comparable
(in EUR m) (in EUR structure structure structure
m) and
basis basis currency
basis
by sector and
division:
Innovative
Materials (1) 3.991 4.748 +19.0% +18.5% +10.9%
Flat Glass 2.374 2.681 +12.9% +12.8% +6.7%
High-Performance
Materials 1.629 2.078 +27.6% +26.7% +16.8%
Construction
Products (1) 5.181 5.518 +6.5% +5.6% +0.2%
Interior Solutions 2.495 2.660 +6.6% +4.8% +0.1%
Exterior Solutions 2.703 2.878 +6.5% +6.5% +0.4%
Building
Distribution 8.657 9.004 +4.0% +3.8% +1.0%
Packaging 1.701 1.793 +5.4% +5.4% +0.7%
Internal sales and
misc. -459 -473 n.m. n.m. n.m.
Group Total 19.071 20.590 +8.0% +7.6% +2.8%
(1) including intra-sector
eliminations
by geographic area:
France 5.600 5.602 +0.0% +0.0% +0.0%
Other Western
European countries 8.458 8.902 +5.2% +5.1% +2.1%
North America 2.363 2.670 +13.0% +12.2% +1.7%
Emerging countries
and Asia 3.430 4.352 +26.9% +25.6% +13.0%
Internal sales -780 -936 n.m. n.m. n.m.
Group Total 19.071 20.590 +8.0% +7.6% +2.8%
H2 H2 change on H2 H2
II. OPERATING 2009 2010 an actual 2009 2010
INCOME
(in EUR m) (in EUR structure (in % of (in % of
m) sales) sales)
basis
by sector and
division:
Innovative
Materials 269 553 +105.6% 6.7% 11.6%
Flat Glass 142 240 +69.0% 6.0% 9.0%
High-Performance
Materials 127 313 +146.5% 7.8% 15.1%
Construction
Products 511 515 +0.8% 9.9% 9.3%
Interior Solutions 173 206 +19.1% 6.9% 7.7%
Exterior Solutions 338 309 -8.6% 12.5% 10.7%
Building
Distribution 296 381 +28.7% 3.4% 4.2%
Packaging 204 207 +1.5% 12.0% 11.5%
Misc. 6 16 n.m. n.m. n.m.
Group Total 1.286 1.672 +30.0% 6.7% 8.1%
by geographic area:
France 313 356 +13.7% 5.6% 6.4%
Other Western
European countries 470 592 +26.0% 5.6% 6.7%
North America 211 248 +17.5% 8.9% 9.3%
Emerging countries
and Asia 292 476 +63.0% 8.5% 10.9%
Group Total 1.286 1.672 +30.0% 6.7% 8.1%
H2 H2 change on H2 H2
III. BUSINESS 2009 2010 an actual 2009 2010
INCOME
(in EUR m) (in EUR structure (in % of (in % of
m) sales) sales)
basis
by sector and
division:
Innovative
Materials 128 501 +291.4% 3.2% 10.6%
Flat Glass 52 136 +161.5% 2.2% 5.1%
High-Performance
Materials 76 365 +380.3% 4.7% 17.6%
Construction
Products 219 445 +103.2% 4.2% 8.1%
Interior Solutions -80 183 +328.8% -3.2% 6.9%
Exterior Solutions 299 262 -12.4% 11.1% 9.1%
Building
Distribution 179 243 +35.8% 2.1% 2.7%
Packaging 177 187 +5.6% 10.4% 10.4%
Misc. -64 (a) -53 (a) n.m. n.m. n.m.
Group Total 639 1.323 +107.0% 3.4% 6.4%
by geographic area:
France 180 297 +65.0% 3.2% 5.3%
Other Western
European countries 257 443 +72.4% 3.0% 5.0%
North America -57 (a) 165 (a) +389.5% -2.4% 6.2%
Emerging countries
and Asia 259 418 +61.4% 7.6% 9.6%
Group Total 639 1.323 +107.0% 3.4% 6.4%
(a) after asbestos-related charge (before tax) of EUR37.5m in 2009
and EUR59.5m in 2010
H2 H2 change on H2 H2
IV. CASH FLOW 2009 2010 an actual 2009 2010
(in EUR m) (in EUR structure (in % of (in % of
m) sales) sales)
basis
by sector and
division:
Innovative
Materials 262 495 +88.9% 6.6% 10.4%
Flat Glass 129 270 +109.3% 5.4% 10.1%
High-Performance
Materials 133 225 +69.2% 8.2% 10.8%
Construction
Products 327 431 +31.8% 6.3% 7.8%
Building
Distribution 203 298 +46.8% 2.3% 3.3%
Packaging 232 238 +2.6% 13.6% 13.3%
Misc. 200 (a) 111 (a) n.m. n.m. n.m.
Group Total 1.224 1.573 +28.5% 6.4% 7.6%
by geographic area:
France 228 202 -11.4% 4.1% 3.6%
Other Western
European countries 438 667 +52.3% 5.2% 7.5%
North America 216 (a) 211 (a) -2.3% 9.1% 7.9%
Emerging countries
and Asia 342 493 +44.2% 10.0% 11.3%
Group Total 1.224 1.573 +28.5% 6.4% 7.6%
(a) after asbestos-related charge (after tax) of EUR23m in H2-2009
versus EUR36m in H2-2010
H2 H2 change on H2 H2
V. CAPITAL 2009 2010 an actual 2009 2010
EXPENDITURE
(in EUR m) (in EUR structure (in % of (in % of
m) sales) sales)
basis
by sector and
division:
Innovative
Materials 247 411 +66.4% 6.2% 8.7%
Flat Glass 176 297 +68.8% 7.4% 11.1%
High-Performance
Materials 71 114 +60.6% 4.4% 5.5%
Construction
Products 229 325 +41.9% 4.4% 5.9%
Interior Solutions 111 151 +36.0% 4.4% 5.7%
Exterior Solutions 118 174 +47.5% 4.4% 6.0%
Building
Distribution 88 124 +40.9% 1.0% 1.4%
Packaging 163 147 -9.8% 9.6% 8.2%
Misc. 8 11 n.m. n.m. n.m.
Group Total 735 1.018 +38.5% 3.9% 4.9%
by geographic area:
France 148 213 +43.9% 2.6% 3.8%
Other Western
European countries 244 294 +20.5% 2.9% 3.3%
North America 94 135 +43.6% 4.0% 5.1%
Emerging countries
and Asia 249 376 +51.0% 7.3% 8.6%
Group Total 735 1.018 +38.5% 3.9% 4.9%
VI. EBITDA H2 H2 change on H2 H2
2009 2010 an actual 2009 2010
(in EUR m) (in EUR structure (in % of (in % of
m) sales) sales)
basis
by sector and
division:
Innovative
Materials 508 791 +55.7% 12.7% 16.7%
Flat Glass 288 394 +36.8% 12.1% 14.7%
High-Performance
Materials 220 397 +80.5% 13.5% 19.1%
Construction
Products 763 773 +1.3% 14.7% 14.0%
Interior Solutions 336 370 +10.1% 13.5% 13.9%
Exterior Solutions 427 403 -5.6% 15.8% 14.0%
Building
Distribution 442 515 +16.5% 5.1% 5.7%
Packaging 312 325 +4.2% 18.3% 18.1%
Misc. 19 28 n.m. n.m. n.m.
Group Total 2.044 2.432 +19.0% 10.7% 11.8%
by geographic area:
France 507 538 +6.1% 9.1% 9.6%
Other Western
European countries 747 860 +15.1% 8.8% 9.7%
North America 327 366 +11.9% 13.8% 13.7%
Emerging countries
and Asia 463 668 +44.3% 13.5% 15.3%
Group Total 2.044 2.432 +19.0% 10.7% 11.8%
Appendix 3: Sales by business sector and geographic area - Fourth
Quarter
Q4 Q4 change on change on change on a
I. SALES 2009 2010 an actual a comparable comparable
(in EUR (in EUR structure structure structure
m) m) and
basis basis currency
basis
by sector and
division:
Innovative Materials
(1) 2.038 2.365 +16.0% +15.7% +9.0%
Flat Glass 1.214 1.364 +12.4% +12.4% +6.8%
High-Performance
Materials 828 1.010 +22.0% +21.1% +12.7%
Construction
Products (1) 2.427 2.671 +10.1% +9.1% +3.7%
Interior Solutions 1.225 1.323 +8.0% +6.1% +1.6%
Exterior Solutions 1.209 1.357 +12.2% +12.3% +6.0%
Building
Distribution 4.285 4.434 +3.5% +3.2% +0.6%
Packaging 825 870 +5.5% +5.5% +1.3%
Internal sales and
misc. -223 -228 n.m. n.m. n.m.
Group Total 9.351 10.112 +8.1% +7.7% +3.3%
(1) including intra-sector
eliminations
by geographic area:
France 2.873 2.868 -0.2% -0.2% -0.2%
Other Western
European countries 4.111 4.339 +5.5% +5.4% +2.4%
North America 1.056 1.229 +16.4% +15.7% +5.2%
Emerging countries
and Asia 1.706 2.152 +26.1% +24.9% +13.4%
Internal sales -395 -476 n.m. n.m. n.m.
Group Total 9.351 10.112 +8.1% +7.7% +3.3%
Appendix 4 : CONSOLIDATED BALANCE SHEET
in EUR millions Dec 31, 2010 Dec 31, 2009
ASSETS
Goodwill 11.030 10.740
Other intangible assets 3.067 2.998
Property, plant and equipment 13.727 13.300
Investments in associates 137 123
Deferred tax assets 700 676
Other non-current assets 272 312
Non-current assets 28.933 28.149
Inventories 5.841 5.256
Trade accounts receivable 5.038 4.926
Current tax receivable 175 333
Other accounts receivable 1.248 1.202
Cash and cash equivalents 2.762 3.157
Current assets 15.064 14.874
Total assets 43.997 43.023
Liabilities and Shareholders' equity
Capital stock 2.123 2.052
Additional paid-in capital and legal
reserve 5.781 5.341
Retained earnings and net income for the
year 10.614 10.137
Cumulative translation adjustments (383) (1.340)
Fair value reserves (43) (75)
Treasury stock (224) (203)
Shareholders' equity 17.868 15.912
Minority interests 364 302
Total equity 18.232 16.214
Long-term debt 7.822 8.839
Provisions for pensions and other
employee benefits 2.930 2.958
Deferred tax liabilities 909 921
Provisions for other liabilities and 2.228 2.169
charges
Non-current liabilities 13.889 14.887
Current portion of long-term debt 1.094 1.880
Current portion of provisions for other
liabilities and charges 527 518
Trade accounts payable 5.690 5.338
Current tax liabilities 156 108
Other accounts payable 3.395 3.086
Short-term debt and bank overdrafts 1.014 992
Current liabilities 11.876 11.922
Total equity and liabilities 43.997 43.023
Appendix 5: Consolidated cash flow statement
(in EUR millions) 2010 2009
Net income attributable to equity holders of the
parent 1.129 202
Minority interests in net income 84 39
Share in net income of associates, net of
dividents received (5) 2
Depreciation, amortization and impairment of
assets 1.755 1.857
Gains and losses on disposals of assets (87) 32
Unrealized gains and losses arising from changes
in fair value and share-based payments 53 100
Changes in inventories (404) 989
Changes in trade accounts receivable and payable,
and other accounts receivable and payable 299 509
Changes in tax receivable and payable 179 (216)
Changes in deferred taxes and provisions for (230) (124)
other liabilities and charges
Net cash from operating activities 2.773 3.390
Purchases of property, plant and equipment [
2010: (1,450), 2009: (1,249) ] and intangible
assets (1.520) (1.319)
Purchases of property, plant and equipment in
finance lease (2) (16)
Increase (decrease) in amounts due to suppliers
of fixed assets 48 (105)
Acquisitions of shares in consolidated companies
[ 2010 : (124), 2009 : (200) ], net of debt
acquired (132) (181)
Acquisitions of other investments (5) (4)
Increase in investment-related liabilities 17 29
Decrease in investment-related liabilities (16) (59)
Investments (1.610) (1.655)
Disposals of property, plant and equipment and
intangible assets 99 71
Disposals of shares in consolidated companies,
net of cash divested 197 6
Disposals of other investments and other
divestments 3 6
Divestments 299 83
Increase in loans and deposits (77) (39)
Decrease in loans and deposits 63 47
Net cash used in investing activities /
divestments (1.325) (1.564)
Issues of capital stock 511 1.923
Minority interests' share in capital increases of
subsidiaries 2 6
(Increase) decrease in treasury stock (24) 6
Dividends paid (509) (486)
Dividends paid to minority shareholders of
consolidated subsidiaries and increase (decrease)
in dividends payable (64) (27)
Cash flows from (used in) financing activities (84) 1.422
Increase (decrease) in net debt 1.364 3.248
Net effect of exchange rate changes on net debt 7 (56)
Net effect from changes in fair value on net debt 15 (67)
Net debt at beginning of year (8.554) (11.679)
Net debt at end of year (7.168) (8.554)
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
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