Saint-Gobain: 2009 Action Plan: Ahead of Targets
PARIS, February 25, 2010 /PRNewswire-FirstCall/ --
2009 ACTION PLAN: AHEAD OF TARGETS
- Sales prices: +0.8% over the year.
- Cost savings over the year: EUR1,100m.
- Second-half operating income and recurring net income
well above the first half: respectively, +38% and +94%.
- Free cash flow(1) for the year above EUR1bn (EUR1,019m), and
reduction of EUR1.4bn in working capital requirements (WCR).
- Sharp reduction in capex: -EUR900m and
tight rein on acquisitions, down to EUR204m.
- Balance sheet strengthened: EUR3.1bn of net debt paid down;
gearing ratio cut to 53% of equity.
2009 DIVIDEND UNCHANGED AT EUR1 PER SHARE
2010 TARGET: STRONG GROWTH IN OPERATING INCOME (AT CONSTANT EXCHANGE
RATES (2))
2009 KEY FIGURES FY 2009 H1 2009 H2 2009 Change
(EURm) H2/H1
Net sales 37,786 (-13.7%) 18,715 19,071 +1.9%
Operating income 2,216 (-39.3%) 930 1,286 +38%
Recurring net income(3) 617 (-67.8%) 210 407 +94%
1. Excluding the tax effect of capital gains and losses on disposals,
exceptional asset write-downs and material non-recurring provisions.
2. Exchange rates for 2009.
3. Excluding capital gains and losses on disposals, asset write-downs and
material non-recurring provisions.
Operating performance
Against the backdrop of an unprecedented economic and financial crisis affecting virtually all sectors and countries across the globe, trading for the Group was sluggish throughout 2009 in most of its businesses and geographic areas. However, there was a relative improvement over the second half of the year compared with the first half, in terms of both like-for-like growth and profitability. Gains in profitability were chiefly attributable to the cost cutting program implemented. The Group therefore considers that business bottomed out overall in 2009. Nevertheless, the global economic climate remained very challenging in the second half of the year. Only Asian and Latin American countries saw a significant pick-up in trading between the first and second half of the year (around 20%), and have now put the crisis behind them. While trading in both Western and Eastern Europe along with North America seems to have stabilized overall at a low level (particularly in Construction), certain industries such as the automotive sector saw an improvement in the second half of the year. Household consumption, in turn, remained relatively less affected by the downturn in the economic climate in 2009.
The Group as a whole reported a 13.2% decline in like-for-like sales for 2009 (-15.5% in the first half and -10.8% in the second). This decline is due to a sharp 14.0% fall in sales volumes over the year (-17.2% in the first half and -10.6% in the second). Sales prices, in contrast, held firm over the year in all business sectors except Flat Glass, allowing the Group to benefit from a positive spread between prices and the cost of raw materials and energy. However, prices slipped 0.2% in the second half of the year after a rise of 1.7% in the six months to June 30, due mainly to a strong performance in the comparative period. The cost savings realized by the Group drove a significant rise in its operating margin in the second half of the year, up to 6.7% versus 5.0% in the first half.
1degrees) Performance of Group business sectors
All of the Group's business sectors with the exception of Packaging were hit by a sharp decline in sales volumes and profitability over the year, although there was a relative improvement in the second half compared with the six months to June 30.
After being the hardest hit by the economic crisis in the first half of 2009, Innovative Materials staged the strongest recovery in the second half of the year, in terms of both sales and profitability, lifting the sector's operating margin from 2.7% in the first half to 6.7% in the following six months.
- Flat Glass posted a strong like-for-like advance in sales in the second
half of the year compared with the six months to June 30, powered by a
sharp upturn in sales volumes in Asia and Latin America, and in
Automotive Flat Glass across the globe, as well as a steep rise in the
price of commodity products (float glass) in Europe during the second
half of the year. Buoyed by the impact of the cost cutting program
launched in 2009 and by the fall in the cost of raw materials and
energy, the operating margin for the second half jumped to 6.0% of
sales, versus 0.6% of sales in the first half of 2009.
- High-Performance Materials (HPM) also saw like-for-like trading rally
between the first and second six months of the year. This reflects the
upturn in Asian and Latin American economies, and more generally, the
recovery of some HPM markets linked to industrial output. HPM reported
a significant improvement in its operating margin over the second half
of the year, up to 7.8% versus 5.5% in the first half, boosted by the
cost savings achieved and upbeat sales prices amid falling raw
materials and energy costs.
Trading in the Construction Products (CP) Business Sector stabilized over the second half of 2009 compared with the first half, both for the sector as a whole and for each of its businesses. The restructuring measures carried out and a positive price impact in Exterior Solutions throughout the year pushed the sector's operating margin up to 9.5% in 2009 from 8.9%, with the increase gathering pace in the second half of the year (9.9% versus 9.1% in the six months to June 30).
- Owing to a more favorable basis for comparison (particularly in the UK
and US), the like-for-like decline in Interior Solutions sales was
smaller in the second half of 2009 compared to the first (down 14.8%
versus 19.5%). The operating margin crept up slightly in the second
half, to 6.9% compared with 6.7% for the previous six months, as the
cost savings achieved were partly offset by the erosion in sales prices
in the six months to December 31, 2009.
- Exterior Solutions also saw a relative improvement in sales volumes in
the second half of the year compared to the first six months, chiefly
in North America, Asia and emerging countries. Over the year as a whole
and in the six months to December 31, the sector's profitability also
continued to benefit from a favorable price effect (despite a much
higher basis for comparison in the second half of the year compared
with the first six months) and from the positive impact of the
restructuring measures carried out. Consequently, its operating margin
rose significantly over the year, up to 11.8% versus 8.1%, with the
increase picking up pace in the second half (12.5% versus 11.2% in the
six months to June 30).
Building Distribution also saw a slight improvement in trading in the second half of the year compared with the first, with sales declining only 9.9% after 14.5% in the first half. While the UK and Spain remained the hardest hit by the economic crisis, their performance now benefits from a weaker comparative period (second-half 2008). Germany and Scandinavia continued to hold up well in the second half of the year. Most other European countries and the United States reported a slight slowdown in the pace of decline compared with the first half. Upbeat sales margins and especially the restructuring measures carried out helped drive a significant improvement in the sector's operating margin, up to 3.4% in the second half of the year from 1.4% in the first half.
Packaging continued to turn in a solid performance despite the crisis, with sales and operating income for the year virtually unchanged from 2008. However, its like-for-like trading slipped 3.8%, as the positive momentum in sales prices failed to fully offset the decline in sales volumes in Europe. The operating margin for the sector improved slightly on 2008, up to 12.7% compared with 12.5% previously.
2degrees) Analysis by geographic area
All of the geographic areas where the Group operates were affected by the economic crisis throughout 2009. However, there was a relative improvement in the second half of the year compared with the first half, fueled mainly by the recovery of certain industrial markets. The pace of the decline in like-for-like sales slowed and operating margins improved significantly. After a sharp upturn in activity between the first and second six months of the year, Latin America and Asia in particular have now put the crisis behind them, with fourth-quarter trading for these regions on a par with their performance in the three months to December 31, 2008.
- In France, trading remained sluggish in the second half of the year,
dampened by lackluster activity in construction and industrial markets.
However, the operating margin for the region improved, up to 5.6% in
the second half of 2009 from 5.4% in the six months to June 30.
- Other Western European countries benefited from a noticeable uptrend in
the second half of the year, with negative organic growth coming in at
11.4% versus negative growth of 19.5% in the six months to June 30.
This was due chiefly to second-half trading advances across Germany
(particularly in industry) and Scandinavia compared with the first
half, as well as a more favorable basis for comparison in the UK and
Spain. Combined with the impact in the second half of the year of cost
savings achieved since the onset of the crisis, this performance
sparked a significant improvement in the region's operating margin, up
to 5.6% of sales compared with 3.2% in the first half.
- North America was affected by the continuing decline in construction
coupled with the collapse in industrial markets over the first half of
the year. Like-for-like sales retreated 14.5% over the year. The
decline was smaller in the second half due to a slowdown in the
decrease in volumes. Over the year as a whole, the operating margin
rose sharply to 8.9% from 5.1% in 2008, on the back of the
restructuring measures carried out and robust sales prices, with the
increase gathering pace in the second half of the year (8.9% versus
8.8% in the first half).
- Emerging countries and Asia bounced back strongly between the first and
second six months of the year, with sales rebounding 12.9% after
trading picked up in Latin American and Asian economies - where like-
for-like growth between the two periods came in at 18.7%. Eastern
European countries are recovering more slowly, and trading remains very
slack. The decline in sales for the region slowed markedly in the
second half compared with the first (down 9.3% versus 13.5%), while the
operating margin almost doubled to 8.5%, from 4.5% in the six months to
June 30, 2009.
2009 consolidated financial statements
The Group's 2009 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 25, 2010. Key consolidated data are summarized below:
2008 2009 %
EUR EUR change
millions millions
Sales and ancillary revenue 43,800 37,786 -13.7%
Operating income 3,649 2,216 -39.3%
Operating depreciation and amortization 1,511 1,514 +0.2%
EBITDA (op. inc.+ operating depreciation
and amortization) 5,160 3,730 -27.7%
Non-operating costs (710) (596) -16.1%
Capital gains and losses on disposals and (127) (380) +199.2%
exceptional
asset write-downs
Dividends received 3 0 n.m.
Business income 2,814 1,240 -55.9%
Net financial expense (750) (805) +7.3%
Income tax (638) (196) -69.3%
Share in net income of associates 11 2 n.m.
Income before minority interests 1,437 241 -83.2%
Minority interests (59) (39) -33.9%
Recurring net income(2) 1,914 617 -67.8%
Recurring(2) earnings per share(3) (in EUR) 5.00 1.20 -76.0%
Net income 1,378 202 -85.3%
Earnings per share(3) (in EUR) 3.60 0.39 -89.2%
Cash flow from operations(4) 3,524 2,303 -34.6%
Cash flow from operations excluding 3,487 2,268 -35.0%
capital gains tax(5)
Capital expenditure 2,149 1,249 -41.9%
Free cash flow (excluding capital gains 1,338 1,019 -23.8%
tax)(5)
Investments in securities 2,358 204 -91.3%
Net debt 11,679 8,554 -26.8%
1 Including the EUR400 million provision for Flat Glass fines.
2 Excluding capital gains and losses on disposals, asset write-downs and material non-recurring provisions.
3 Calculated based on the number of shares outstanding at December 31 (512,931,016 shares in 2009 versus 382,571,985 in 2008). Based on the weighted average number of shares outstanding (473,244,410 shares in 2009 versus 374,998,085 in 2008), recurring earnings per share comes out at EUR1.30 (versus EUR5.10 in 2008), and earnings per share comes out at EUR0.43 (versus EUR3.67 in 2008).
4 Excluding material non-recurring provisions.
5 Excluding the tax effect of capital gains and losses on disposals, asset write-downs and material non-recurring provisions.
Sales declined 13.7%. The positive 0.9% impact of changes in the scope of consolidation was offset by a negative 1.4% currency impact, reflecting a decline in the pound sterling and Brazilian real against the euro. Like-for-like (comparable Group structure and exchange rates), consolidated sales fell 13.2%: sales volumes retreated 14.0%, while prices remained upbeat, gaining 0.8%.
Operating income shed 39.3%. The Group's operating margin came in at 5.9% of sales (8.4% excluding Building Distribution), versus 8.3% (11.0% excluding Building Distribution) in 2008.
In line with the target set by the Group, second-half operating income outperformed operating income for the six months to June 30, 2009, up by 38% to EUR1,286 million from EUR930 million. This essentially reflects the impact of cost savings achieved by the Group.
As a result, the second-half operating margin was up significantly on the margin for the first six months of 2009 (6.7% versus 5.0%), but remained slightly down on the margin for second-half 2008 (6.7% versus 7.6%).
EBITDA (operating income + operating depreciation and amortization) fell 27.7%. The consolidated EBITDA margin came in at 9.9% of sales (14.1% excluding Building Distribution), compared with 11.9% of sales (15.8% excluding Building Distribution) in 2008. The consolidated EBITDA margin in the second half of 2009 was close to its level of second-half 2008 (10.7% versus 11.0%), thanks to the cost cutting program.
Non-operating costs came in at EUR596 million (EUR310 million in 2008, excluding EUR400 million in provisions for Flat Glass fines). The rise in non-operating costs reflects the acceleration in restructuring measures and other adjustments made in response to the crisis, which represented costs of EUR435 million in 2009 versus EUR190 million in 2008. Accruals to the provision set aside for asbestos-related litigation involving CertainTeed in the United States totaled EUR75 million in 2009, as in 2008.
The net balance of capital gains and losses on disposals and exceptional asset write-downs was a negative EUR380 million, including EUR348 million in exceptional asset write-downs. This amount includes EUR215 million for the write-down of a portion of the goodwill relating to the Gypsum business in the United States. The balance primarily reflects write-downs of assets linked to restructuring measures and site closures initiated during the period.
Business income tumbled 55.9% after taking into account the items mentioned above (non-operating costs, capital gains/losses on disposals and exceptional asset write-downs).
Net financial expense edged up to EUR805 million from EUR750 million in 2008, mainly reflecting the rise in the interest cost of pensions (up EUR105 million on 2008), while net borrowing costs were down 12%. The average cost of net debt came out at 5.5%, on a par with 2008.
Recurring net income (excluding capital gains and losses, exceptional asset write-downs and material non-recurring provisions) shed 67.8% year-on-year to EUR617 million. Based on the number of shares outstanding at December 31, 2009 (512,931,016 shares versus 382,571,985 shares at December 31, 2008), recurring earnings per share came out at EUR1.20, down 76.0% on 2008 (EUR5.00). Recurring net income almost doubled in the second half of the year compared with the first, up 94% to EUR407 million from EUR210 million, comfortably meeting the target set by the Group (second-half recurring net income to outperform recurring net income for the first half).
Net income came in at EUR202 million, down 85.3% year-on-year. Based on the number of shares outstanding at December 31, 2009 (512,931,016 shares versus 382,571,985 shares at December 31, 2008), earnings per share came out at EUR0.39, down 89.2% on 2008 (EUR3.60).
Capital expenditure was scaled back 41.9% to EUR1,249 million (versus EUR2,149 million in 2008), and represented 3.3% of sales (4.9% in 2008). The bulk of these investments (55%) focused on markets linked to energy efficiency (Flat Glass - including Solar Power - and Construction Products), and on selective growth projects in emerging countries (e.g., new float-line in Egypt and plasterboard plant in Abu Dhabi).
Cash flow from operations totaled EUR2,303 million, down 35% on 2008. Before the tax impact of capital gains and losses on disposals and asset write-downs, cash flow from operations was EUR2,268 million versus EUR3,487 million in 2008, also down 35%.
Free cash flow (cash flow from operations less capital expenditure) fell 23.3% and 23.8% before the tax impact of capital gains and losses on disposals and asset write-downs, but in both cases was ahead of the Group's EUR1 billion target, at EUR1,054 million and EUR1,019 million, respectively, or 2.8% and 2.7% of sales. In second-half 2009 alone, free cash flow came out at EUR469 million (before the tax impact of capital gains and losses on disposals and asset write-downs), up 45% on second-half 2008. This represents the Group's highest second-half free cash flow in the last five years, and reflects the critical importance of cash flow management to the Group.
The difference between EBITDA and capital expenditure fell 18% over the year, to EUR2,481 million compared with EUR3,011 million in 2008, representing 6.6% of sales (6.9% in 2008). However, this indicator improved significantly in the second half, compared to both the first half of the year (up 12%), and especially the second half of 2008 (up 15%).
After six years of continuous improvements, operating working capital requirements (WCR) were slashed once again, down to 31 days' sales at December 31, 2009 from 38 days' sales at end-2008, representing a cash gain of EUR1.4 billion over the year.
Investments in securities totaled EUR204 million (down 91.3% on 2008), and chiefly resulted from acquisitions carried out in 2008 but only completed in 2009. Of this amount, EUR86 million concerned energy efficiency (solar power and thermal insulation), and EUR70 million related to Asia and emerging countries.
Net debt came in at EUR8.6 billion at December 31, 2009, down EUR3.1 billion, or 26.8%, on December 31, 2008 (EUR11.7 billion). This reflects improvements in operating working capital requirements and a steep reduction in capital expenditure, as well as the rights issue carried out at the beginning of the year. Net debt represents 53% of shareholders' equity, compared with 80% at December 31, 2008. The net debt to EBITDA ratio came out at 2.3X, stable compared with end-December 2008.
Update on asbestos claims in the US
Some 4,000 claims were filed against CertainTeed in 2009, compared with 5,000 in 2008. Over the year, 8,000 claims were settled (as in 2008), bringing the total number of outstanding claims to 64,000 at December 31, 2009, versus 68,000 at December 31, 2008.
A total of USD 77 million in indemnity payments were made over the 12 months to December 31, 2009, versus USD 71 million in the year to December 31, 2008.
In light of these trends, an additional provision of EUR75 million was recorded in 2009 (the same euro amount as in 2008), bringing the coverage for CertainTeed's asbestos-related claims to around USD 500 million at December 31, 2009 versus USD 502 million at December 31, 2008.
Crisis action plan: all goals of the action plan unveiled at the beginning of the year and stepped up in July accomplished
Against the backdrop of an unprecedented economic crisis, the Group resolutely implemented its action plan, which was stepped up in the second half of the year.
In 2009, Saint-Gobain:
- continued to give clear operating priority to sales prices,
which inched up 0.8% over the year despite the downward trend in
inflation. The spread between sales prices and raw materials and energy
costs therefore had a very positive impact throughout the year, due
mainly to the rise in sales prices in the first half and to the fall in
raw materials and energy costs in the six months to December 31.
- implemented and extended the cost cutting program across all
of its businesses:
- EUR1.1 billion in additional cost savings were unlocked over
the year compared with 2008 (versus an initial goal of EUR600 million,
raised to EUR700 million in April and EUR1.1 billion in July). This
brings total cost savings realized in 2008 and 2009 to EUR1.5 billion.
- continued to optimize free cash flow generation, by:
- generating EUR1 billion in free cash flow despite the spike
in restructuring costs, thus meeting the objective set at the beginning
of 2009;
- maintaining a tight rein on working capital requirements
(WCR), which fell by EUR1.4 billion (a reduction of 7 days' sales) in
2009;
- slashing capital expenditure, which dropped EUR900 million
over the year compared with an initial target reduction of EUR500
million, increased to EUR700 million in July).
- significantly curbed acquisitions: financial investments in
2009 (EUR204 million) were down 91% on the same year-ago period and are
mainly related to the completion of acquisitions undertaken in 2008 in
the energy efficiency segment (solar power and thermal insulation) as
well as in Asia and emerging countries.
- Thanks to these measures, coupled with a successful EUR1.5
billion rights issue and payment of 65% of the 2008 dividend in stock,
the Group has paid down EUR3.1 billion in net debt and strengthened its
balance sheet: the gearing ratio has been cut to 53% of equity versus
80% at end-December 2008, while the net debt to EBITDA ratio stabilized
at 2.3X.
Outlook and objectives for 2010
After a particularly tough year in 2009, the Group expects the economic environment to prove somewhat better overall in 2010, but with contrasting trends across each region.
In Western Europe and North America, the economic mood appears fragile, and trends are expected to vary widely from one country to the next (improvement in Anglo-Saxon countries, further declines in Southern Europe). Trading conditions should remain challenging in construction markets. In contrast, the upturn in industrial markets observed in the second half of 2009 should continue, thanks to rebuilding of inventory levels. Lastly, household consumption markets should hold firm.
The recovery in Asia and emerging countries should gather pace in 2010, spurred by vigorous growth in Latin America and Asia, and particularly Brazil, China and India. The upswing in Eastern European countries appears slower and more subdued.
Against this backdrop, the Group will continue to react and adapt to developments in its markets in 2010, and will pursue its 2009 action plan priorities with a highly selective approach. Accordingly, Saint-Gobain will:
- continue to give priority to sales prices.
- continue to implement cost cutting measures, targeting an
additional EUR200 million in cost savings, focused on countries and/or
businesses with limited short-term recovery prospects as well as
businesses reliant on capital expenditure.
This will come on top of the full benefits of the 2009 cost cutting measures set to boost 2010 operating income, with EUR400 million in cost savings in second-half 2009 carried over to first-half 2010. Therefore, total cost savings in 2010 are expected to exceed 2009 cost savings by EUR600 million, prompting to an upswing in earnings and operating margins. All in all, the Group's cost base will have been slashed by EUR2.1 billion in 2010 compared to 2007.
- continue to maintain strict financial discipline.
- finally, thanks to its robust financial structure,
Saint-Gobain will be ideally placed to leverage any growth
opportunities in its markets, buoyed by a highly selective and tempered
investment policy (capex and investments in securities). This policy
will be anchored around emerging countries, energy efficiency and solar
power, which should represent more than 80% of capacity investments by
the Group's industrial businesses in 2010.
The Group's targets for 2010 are therefore:
- strong growth in operating income at constant exchange rates
(2009 exchange rates);
- free cash flow of above EUR1 billion;
- a persistently robust financial structure.
In terms of dividend policy, at its meeting of February 25, Compagnie de Saint-Gobain's Board of Directors decided to recommend to the June 3, 2010 Shareholders' Meeting the same dividend amount as in 2009, i.e. EUR1 per share, payable in cash or in shares*, at shareholders' discretion. The dividend represents 83% of recurring EPS and 256% of EPS, and a net dividend yield of 2.6% based on the closing share price at December 31, 2009. The record date set for June 8 will be followed by a take-up period of 15 days between June 9 and June 23. The dividends will therefore be paid in cash or in shares on July 2, 2010.
* regarding stock dividends, Compagnie de Saint-Gobain's Board of Directors will recommend that the Shareholders' Meeting set the issue price for any new shares by applying a 10% discount to the average opening share price over the 20 trading days preceding the Shareholders' Meeting of June 3, 2010, less the amount of the dividend.
Forthcoming results announcement
- Sales for the first quarter of 2010: April 22, 2010, after close of
trading on the Paris Bourse.
Appendix 1: Results by business sector and geographic area - Full Year
2008 2009 Change on Change on Change on a
(in EUR (in EUR an actual a comparable comparable
m) m) structure
structure structure
basis basis and currency
basis
I. SALES
By sector and
division:
Innovative Materials
(1) 9.677 7.792 -19.5% -18.5% -17.4%
Flat Glass 5.549 4.572 -17.6% -17.6% -14.9%
High-Performance
Materials 4.165 3.240 -22.2% -20.0% -21.1%
Construction
Products (1) 12.035 10.414 -13.5% -15.2% -14.4%
Interior Solutions 6.149 5.034 -18.1% -19.0% -17.2%
Exterior Solutions
Building 5.919 5.413 -8.5% -11.2% -11.3%
Distribution 19.696 17.101 -13.2% -14.5% -12.2%
Packaging 3.547 3.445 -2.9% -3.5% -3.8%
Internal sales and
misc. -1.155 -966 n.m. n.m. n.m.
GROUP TOTAL 43.800 37,786 -13.7% -14.6% -13.2%
(1) including intra-sector
eliminations
By geographic area:
France 13.076 11.495 -12.1% -12.3% -12.3%
Other Western
European countries 19.941 16.557 -17.0% -18.1% -15.6%
North America 5.499 4.864 -11.5% -10.1% -14.5%
Emerging countries
and Asia 7.404 6.377 -13.9% -16.5% -11.4%
Internal sales -2.120 -1.507 n.m. n.m. n.m.
GROUP TOTAL 43.800 37.786 -13.7% -14.6% -13.2%
2008 2009 Change on 2008 2009
(in EUR (in EUR an actual (in % of (in % of
m) m) sales) sales)
structure
basis
II. OPERATING INCOME
By sector and
division:
Innovative Materials 1.244 370 -70.3% 12.9% 4.7%
Flat Glass 701 155 -77.9% 12.6% 3.4%
High-Performance
Materials 543 215 -60.4% 13.0% 6.6%
Construction
Products 1.070 985 -7.9% 8.9% 9.5%
Interior Solutions 592 344 -41.9% 9.6% 6.8%
Exterior Solutions 478 641 34.1% 8.1% 11.8%
Building
Distribution 894 412 -53.9% 4.5% 2.4%
Packaging 442 437 -1.1% 12.5% 12.7%
Misc. -1 12 n.m. n.m. n.m.
GROUP TOTAL 3.649 2.216 -39.3% 8.3% 5.9%
By geographic area:
France 1.062 629 -40.8% 8.1% 5.5%
Other Western
European countries 1.530 730 -52.3% 7.7% 4.4%
North America 283 432 52.7% 5.1% 8.9%
Emerging countries
and Asia 774 425 -45.1% 10.5% 6.7%
GROUP TOTAL 3.649 2.216 -39.3% 8.3% 5.9%
2008 2009 Change on 2008 2009
(in EUR (in EUR an actual (in % of (in % of
m) m) sales) sales)
structure
basis
III. BUSINESS INCOME
By sector and
division:
Innovative Materials 712 70 -90.2% 7.4% 0.9%
Flat Glass 212 -46 -121.7% 3.8% -1.0%
High-Performance
Materials 500 116 -76.8% 12.0% 3.6%
Construction
Products 948 639 -32.6% 7.9% 6.1%
Interior Solutions 579 59 -89.8% 9.4% 1.2%
Exterior Solutions 369 580 57.2% 6.2% 10.7%
Building
Distribution 826 250 -69.7% 4.2% 1.5%
Packaging 432 395 -8.6% 12.2% 11.5%
Misc. -104(a) -114(a) n.m. n.m. n.m.
GROUP TOTAL 2.814 1.240 -55.9% 6.4% 3.3%
By geographic area:
France 838 462 -44.9% 6.4% 4.0%
Other Western
European countries 1.107 358 -67.7% 5.6% 2.2%
North America 162(a) 64(a) -60.5% 2.9% 1.3%
Emerging countries
and Asia 707 356 -49.6% 9.5% 5.6%
GROUP TOTAL 2.814 1.240 -55.9% 6.4% 3.3%
(a) after asbestos-related charge (before tax) of EUR75m in 2009 and 2008
2008 2009 Change on 2008 2009
(in EUR (in EUR an actual (in % of (in % of
m) m) sales) sales)
structure
basis
IV. CASH FLOW
By sector and
division:
Innovative Materials 1.170 385 -67.1% 12.1% 4.9%
Flat Glass 733 170 -76.8% 13.2% 3.7%
High-Performance
Materials 437 215 -50.8% 10.5% 6.6%
Construction
Products 885 659 -25.5% 7.4% 6.3%
Building
Distribution 650 283 -56.5% 3.3% 1.7%
Packaging 510 492 -3.5% 14.4% 14.3%
Misc. 309(a) 484(a) n.m. n.m. n.m.
GROUP TOTAL 3.524 2.303 -34.6% 8.0% 6.1%
By geographic area:
France 720 527 -26.8% 5.5% 4.6%
Other Western
European countries 1.655 797 -51.8% 8.3% 4.8%
North America 314(a) 451(a) 43.6% 5.7% 9.3%
Emerging countries
and Asia 835 528 -36.8% 11.3% 8.3%
GROUP TOTAL 3.524 2.303 -34.6% 8.0% 6.1%
(a) after asbestos-related charge (after tax) of EUR46m in 2009 and 2008
2008 2009 Change on 2008 2009
(in EUR (in EUR an actual (in % of (in % of
m) m) sales) sales)
structure
basis
V. CAPITAL
EXPENDITURE
By sector and
division:
Innovative Materials 799 456 -42.9% 8.3% 5.9%
Flat Glass 576 326 -43.4% 10.4% 7.1%
High-Performance
Materials 223 130 -41.7% 5.4% 4.0%
Construction
Products 758 364 -52.0% 6.3% 3.5%
Interior Solutions 528 199 -62.3% 8.6% 4.0%
Exterior Solutions 230 165 -28.3% 3.9% 3.0%
Building
Distribution 291 155 -46.7% 1.5% 0.9%
Packaging 283 259 -8.5% 8.0% 7.5%
Misc. 18 15 n.m. n.m. n.m.
GROUP TOTAL 2.149 1.249 -41.9% 4.9% 3.3%
By geographic area:
France 554 254 -54.2% 4.2% 2.2%
Other Western
European countries 682 414 -39.3% 3.4% 2.5%
North America 220 167 -24.1% 4.0% 3.4%
Emerging countries
and Asia 693 414 -40.3% 9.4% 6.5%
GROUP TOTAL 2.149 1.249 -41.9% 4.9% 3.3%
2008 2009 Change on 2008 2009
(in EUR (in EUR an actual (in % of (in % of
m) m) sales) sales)
structure
basis
VI. EBITDA
By sector and
division:
Innovative Materials 1.737 843 -51.5% 17.9% 10.8%
Flat Glass 1.016 444 -56.3% 18.3% 9.7%
High-Performance
Materials 721 399 -44.7% 17.3% 12.3%
Construction
Products 1.573 1.494 -5.0% 13.1% 14.3%
Interior Solutions 919 672 -26.9% 14.9% 13.3%
Exterior Solutions 654 822 25.7% 11.0% 15.2%
Building
Distribution 1.178 698 -40.7% 6.0% 4.1%
Packaging 650 657 1.1% 18.3% 19.1%
Misc. 22 38 n.m. n.m. n.m.
GROUP TOTAL 5.160 3.730 -27.7% 11.8% 9.9%
By geographic area:
France 1.434 1.013 -29.4% 11.0% 8.8%
Other Western
European countries 2.095 1.282 -38.8% 10.5% 7.7%
North America 516 674 30.6% 9.4% 13.9%
Emerging countries
and Asia 1.115 761 -31.7% 15.1% 11.9%
GROUP TOTAL 5.160 3.730 -27.7% 11.8% 9.9%
H2 H2 Change on H2 H2
2008 2009 an actual 2008 2009
(in EUR (in EUR structure (in % of (in % of
m) m) basis sales) sales)
VI. EBITDA
By sector and
division:
Innovative Materials 781 508 -35.0% 16.7% 12.7%
Flat Glass 445 288 -35.3% 16.7% 12.1%
High-Performance
Materials 336 220 -34.5% 16.5% 13.5%
Construction Products 731 763 4.4% 12.1% 14.7%
Interior Solutions 385 336 -12.7% 12.9% 13.5%
Exterior Solutions 346 427 23.4% 11.2% 15.8%
Building Distribution 569 442 -22.3% 5.9% 5.1%
Packaging 315 312 -1.0% 17.4% 18.3%
Misc. 19 19 n.m. n.m. n.m.
GROUP TOTAL 2.415 2.044 -15.4% 11.2% 10.7%
By geographic area:
France 672 507 -24.6% 10.7% 9.1%
Other Western
European countries 922 747 -19.0% 9.5% 8.8%
North America 282 327 16.0% 9.9% 13.8%
Emerging countries
and Asia 539 463 -14.1% 14.0% 13.5%
GROUP TOTAL 2.415 2.044 -15.4% 11.2% 10.7%
Appendix 3: Sales by business sector and geographic area - Fourth Quarter
Q4 Q4 Change on Change on Change on a
2008 2009 an actual a comparable comparable
structure
(in EUR (in EUR structure structure
m) m) basis basis and
currency
basis
SALES
By sector and
division:
Innovative Materials
(1) 2.228 2.038 -8.5% -8.2% -6.7%
Flat Glass 1.271 1.214 -4.5% -4.5% -4.4%
High-Performance
Materials 972 828 -14.8% -14.1% -10.7%
Construction Products 2.824 2.427 -14.1% -14.8% -12.6%
(1)
Interior Solutions 1.425 1.225 -14.0% -14.4% -12.5%
Exterior Solutions 1.407 1.209 -14.1% -15.1% -12.6%
Building Distribution 4.644 4.285 -7.7% -8.6% -8.4%
Packaging 919 825 -10.2% -8.9% -4.9%
Internal sales and
misc. -250 -224 n.m. n.m. n.m.
GROUP TOTAL 10.365 9.351 -9.8% -10.2% -8.8%
(1) including intra-sector
eliminations
By geographic area:
France 3.167 2.873 -9.3% -9.5% -9.5%
Other Western
European countries 4.577 4.111 -10.2% -10.3% -10.1%
North America 1.320 1.056 -20.0% -20.1% -9.7%
Emerging countries
and Asia 1.793 1.706 -4.9% -6.3% -6.4%
Internal sales -492 -395 n.m. n.m. n.m.
GROUP TOTAL 10.365 9.351 -9.8% -10.2% -8.8%
Appendix 4: CONSOLIDATED BALANCE SHEET
in EUR millions Dec 31, 2009 Dec 31, 2008
ASSETS
Goodwill 10.740 10.671
Other intangible assets 2.998 2.868
Property, plant and equipment 13.300 13.374
Investments in associates 123 116
Deferred tax assets 676 507
Other non-current assets 312 490
Non-current assets 28.149 28.026
Inventories 5.256 6.113
Trade accounts receivable 4.926 5.647
Current tax receivable 333 248
Other accounts receivable 1.202 1.424
Cash and cash equivalents 3.157 1.937
Current assets 14.874 15.369
Total assets 43.023 43.395
Liabilities and Shareholders' equity
Capital stock 2.052 1.530
Additional paid-in capital and legal
reserve 5.341 3.940
Retained earnings and net income for the
year 10.137 10.911
Cumulative translation adjustments (1,340) (1,740)
Fair value reserves (75) (161)
Treasury stock (203) (206)
Shareholders' equity 15.912 14.274
Minority interests 302 256
Total equity 16.214 14.530
Long-term debt 8.839 10.365
Provisions for pensions and other employee
benefits 2.958 2.443
Deferred tax liabilities 921 1.130
Provisions for other liabilities and
charges 2.169 1.950
Non-current liabilities 14.887 15.888
Current portion of long-term debt 1.880 1.364
Current portion of provisions for other
liabilities and charges 518 460
Trade accounts payable 5.338 5.613
Current tax liabilities 108 263
Other accounts payable 3.086 3.390
Short-term debt and bank overdrafts 992 1.887
Current liabilities 11.922 12.977
Total equity and liabilities 43.023 43.395
Appendix 5: Consolidated cash flow statement
(in EUR millions) 2009 2008
Net income attributable to equity holders of the parent 202 1.378
Minority interests in net income 39 59
Share in net income of associates, net of dividents
received 2 (7)
Depreciation, amortization and impairment of assets 1.857 1.681
Gains and losses on disposals of assets 32 (53)
Unrealized gains and losses arising from changes in fair
value and share-based payments 100 15
Changes in inventories 989 (205)
Changes in trade accounts receivable and payable, and
other accounts receivable and payable 509 477
Changes in tax receivable and payable (216) (96)
Changes in deferred taxes and provisions for other
liabilities and charges (124) (270)
Charge to provision for competition litigation 0 400
Net cash from operating activities 3.390 3.379
Purchases of property, plant and equipment [ 2009:
(1,249), 2008: (2,149) ] and intangible assets (1.319) (2.228)
Acquisitions of property, plant and equipment in finance
leases (16) (14)
Increase (decrease) in amounts due to suppliers of fixed
assets (105) (70)
Acquisitions of shares in consolidated companies [ 2009:
(200), 2008: (2,328) ], net of debt acquired (181) (2.937)
Acquisitions of other investments (4) (30)
Increase in investment-related liabilities 29 159
Decrease in investment-related liabilities (59) (103)
Investments (1.655) (5.223)
Disposals of property, plant and equipment and
intangible assets 71 174
Disposals of shares in consolidated companies, net of
net debt divested 6 46
Disposals of other investments and other divestments 6 27
Divestments 83 247
Increase in loans and deposits (39) (53)
Decrease in loans and deposits 47 55
Net cash used in investing activities / divestments (1.564) (4.974)
Issues of capital stock 1.923 356
Minority interests' share in capital increases of
subsidiaries 6 4
(Increase) decrease in treasury stock 6 (7)
Dividends paid (486) (767)
Dividends paid to minority shareholders of consolidated
subsidiaries and increase (decrease) in dividends payable (27) (65)
Net Cash from (used in) financing activities 1.422 (479)
Increase (decrease) in net debt 3.248 (2.074)
Net effect of exchange rate changes on net debt (56) 323
Net effect from changes in fair value on net debt (67)
Net debt at beginning of year (11.679) (9.928)
Net debt at end of year (8.554) (11.679)
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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