holcim strength performance passion 3rd quarter results 2012 and outlook presentation of november 7 2012

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Presentation of November 7, 2012

The spoken word prevails

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2) Holcim sold more cement than in the first nine months of last year This confirms that the unique

geographic diversification of the Group is supporting results In the aggregates segment and to a lesser extent in the ready-mix concrete business, volumes declined This is primarily the result of the crisis in Europe and the weaker demand for these construction materials in Oceania Positive is the fact that over the course of the year Holcim was increasingly able to pass on cost increases to prices Compared with the volumes and net sales, financial results developed over proportionately positive and the Group also achieved slightly better margins Furthermore, I would like to highlight the solid cash flow from operating activities and the better gearing compared with year-end 2011 The Holcim Leadership Journey, our Group-wide program introduced in May, is progressing positively Regions and Group companies have already started to

implement measures and organizational adjustments at Group level have been made These include the introduction of a leaner management structure for Europe, and the creation of a Project Management Office

to monitor the progress of the Holcim Leadership Journey Guidelines to measure the operational and financial progress of the program have also been put in place The detailed financial impact of the entire Holcim Leadership Journey will be released together with the year-end results 2012 The like-for-like

operating EBITDA compared with last year increased by 6.4 percent This includes restructuring costs of 58 million Swiss francs linked to the Holcim Leadership Journey Adjusted for the costs and eliminating the favorable impact of CO2 sales this year, the like-for-like operating EBITDA increased by 8 percent

3) Furthermore, Asia's construction industry benefitted from robust demand, primarily in the big markets Major private and public construction projects supported our sales volumes Due to the combination of innovative products and related services, Holcim is a preferred supplier on many big construction sites However, construction activity was subdued in the Pacific rim, where demand in the non-resource regions remained weak In the Group region Asia Pacific Holcim sold more cement than last year, primarily

supported by rising cement sales volumes in India, the Philippines, Indonesia and Thailand Due to the excellent business climate in Singapore, deliveries of ready-mix concrete did not decline significantly in this Group region The drop in aggregates shipments is a consequence of the subdued construction activity in the Pacific region The construction of the new cement plant in Tuban in East Java made considerable headway The facilities will commence cement production at the end of 2013 and resolve current capacity bottlenecks In view of the positive development of the Indonesian market, Holcim has approved the

construction of a second identical kiln line in Tuban which will go into operation by end of 2014 Despite heavy competitive pressure, Holcim was able to pass on inflationary-induced cost increases to prices and to generate better margins In absolute terms, Ambuja Cements achieved the largest improvement in results, followed by Holcim Indonesia, Holcim Australia and Holcim Philippines

• Rising cement deliveries in the first nine months of 2012

• Price increases support earnings, slightly better margins

• Higher operating EBITDA

• Solid cash flow from operating activities

• Net income significantly higher than last year

• Holcim Leadership Journey progresses according to plan

2

2012 January-Sept 2011

like-for-like

• Robust demand in Asia, but subdued building activity in the Pacific rim

• Rising cement deliveries, but declining aggregates and ready-mix

concrete sales volumes due to Australia

• Inflation-induced cost increases have been passed on to customers

• Higher operating EBITDA primarily due to India, Indonesia, Holcim

Australia and the Philippines

• Solid organic growth at operating EBITDA level

Asia Pacific continues its growth track

3

like-for-like

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3

4) In most Latin American markets the construction industry remained robust This includes countries like El Salvador, Ecuador or Colombia In Mexico however, building activity declined slightly in the aftermath of the July presidential elections, and in Brazil, the overheated economy cooled down The economic situation in the inflationary driven Argentina was difficult Holcim Apasco in Mexico and Holcim El Salvador increased sales volumes in all segments Holcim also achieved higher cement shipments in Costa Rica, Nicaragua, Colombia, Ecuador, Brazil and Chile In the ready-mix concrete area, the reduction in volumes is primarily the result of optimizing margins in this business at Holcim Brazil Due to weaker demand, sales volumes declined in all segments in Argentina The operating EBITDA of the Group region Latin America increased despite higher input costs and the weaker Brazilian currency Operating margins also improved This reflects not only the higher cement sales volumes and the better price situation, but also ongoing efforts to control costs

5) In the European Union the debt crisis and austerity budgets also impacted business development in the construction sector Countries in the south and east of the continent were hit particularly hard by the

recession However, economic activity developed positively in Russia and Azerbaijan Aggregate Industries

UK could not escape the negative market development Holcim also experienced declining sales volumes in Belgium, the Netherlands and France Despite lower demand in Spain, Holcim Spain was more or less able

to maintain sales of cement and clinker due to exports In Italy, construction markets remained subdued Holcim Germany sold slightly less cement, but more aggregates and ready-mix concrete Due to increasing imports, Holcim Switzerland experienced lower sales volumes in all segments In all markets of this Group region, the price situation remained difficult In Eastern and Southeastern Europe public and private

investment activity remained modest Due to the integration of VSH in Slovakia, cement shipments in

Eastern Europe practically achieved the previous year’s level In the ready-mix concrete business the Group companies in Romania, Croatia and the Czech Republic increased deliveries Bulgaria was hit particularly hard by the present difficult market situation The situation of the construction industry in Russia and

Azerbaijan was very different: solid growth in the construction industry supported demand for cement in both markets and price increases could be implemented in Russia Holcim has also decided to modernize the Volsk plant in the Volga region with a new kiln line which will go on stream in the third quarter of 2016 Including restructuring measures of 47 million Swiss francs, consolidated operating EBITDA declined in Europe A substantially lower performance was achieved at Holcim Switzerland, Aggregate Industries UK and Holcim France Better operating results were primarily achieved by the Group companies in Azerbaijan and Russia The new and leaner management structure of Europe is deployed and in place to handle the difficult economic situation in that Group region

• Demand for building materials remains predominantly steady

• House building and infrastructure expansion are growth drivers

• Higher cement sales and partially better market prices

• Significantly better operating results in Colombia, Ecuador and

El Salvador

• Increasing operating EBITDA and better margin, despite higher

energy costs

Latin America remains a pillar of the Group’s success

4

like-for-like

• Debt crisis and restrictive budgetary policies weaken demand

• Declining sales in all segments and further price pressure

• Restructuring costs impact performance

• Better results in Russia and Azerbaijan

• Weaker operating results in Group region Europe

Europe’s economy is suffering from the debt crisis

5

like-for-like

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6) In North America the economy continued to expand at a moderate pace Development in the US

construction sector differed considerably from region to region In the northern states with a Holcim market presence, demand for residential and commercial real estate increased In Canada, investment activity remained lively Holcim US sold more cement Aggregate Industries US increased deliveries of ready-mix concrete Shipments of aggregates remained below the previous year's level, and asphalt sales declined Holcim Canada also sold more cement and ready-mix concrete, partly due to favorable weather conditions for construction Due to delays in projects, sales of aggregates decreased Sales of asphalt remained stable Operating EBITDA for Group region North America improved significantly All three Group companies achieved better financial results, and the operating results of Holcim US and Holcim Canada improved strongly Aside from increases in sales volumes, the reasons for the improvement in margin included lower energy costs and better prices

7) Over the course of the year, Africa Middle East lost some momentum due to the lack of dynamism in important markets such as Morocco and Lebanon Social housing remained the main pillar of growth The Lebanese economy felt the conflict and turmoil in Syria This had an impact on construction activity

particularly in the north of the country, while it remained lively in the region of Beirut In all segments, delivery volumes of Holcim Morocco almost reached the level of the previous year, but market prices weakened over the course of 2012 At Holcim Lebanon, shipments of cement declined However, due to several construction projects in the region of Beirut, deliveries of ready-mix concrete slightly rose In the Indian Ocean region, the Group companies recorded slightly lower sales of cement In West Africa and the Arabian Gulf local grinding stations increased their deliveries of cement The reduction in operating EBITDA can be attributed largely to adverse market conditions and higher production costs in Lebanon

• Moderate economic growth continues in the US with regional

differences; in Canada, investment activity remains lively

• Higher cement and ready-mix concrete shipments, but declining

aggregates business

• Lower energy costs and partially higher prices

• All Group companies achieved higher operating EBITDA

deliveries

6

like-for-like

• In Morocco, construction activity decreased over the course of the

year, and Lebanon was affected by the political unrest in the region

• Stable construction markets in the Indian Ocean and in West Africa

• Lower sales volumes of cement, but higher deliveries of aggregates

and ready-mix concrete

• Decreasing operating EBITDA due to Lebanon, but stable results in

Morocco, West Africa and Indian Ocean

Lack of activity in Africa Middle East

7

like-for-like

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5

8) Let us begin with the review of the key financial figures of the third quarter before turning to the nine months 2012 results Net sales increased by 9.8 percent driven by like-for-like growth of 3.2 percent and foreign currency developments contributing 6.2 percent While Cement recorded a flat volume growth and Aggregates and Ready-Mix concrete continued to witness negative volume developments compared to last year, all three product categories continued to record mid- to high-single digit price that contributed

substantially to the overall sales growth Continued efforts on the operating cost base resulted in fixed costs growing at a lower rate than sales, offsetting parts of the proportional increase in variable costs driven by higher raw material and energy costs As a result of this and above all the higher prices, the operating

EBITDA increased to 1.2 billion Swiss francs, expanding the operating EBITDA margin on a like-for-like base from 20.2 percent in the third quarter 2011 to 20.8 percent in the third quarter 2012 Adjusting for the 21 million Swiss francs restructuring costs related to Hungary and the 3 million Swiss francs lower CO2 sales, the margin even reached 21.2 percent The operating profit benefited from the aforementioned

developments and together with a slightly reduced depreciation and amortization increased by 13.9 percent

to 762 million Swiss francs Adjusting for the 3 million Swiss francs lower CO2 sales in Europe and the one-off costs of 60 million Swiss francs related to the Holcim Leadership Journey, the operating profit margin improved to 14.1 percent, up from 12.6 percent a year ago The net income attributable to Holcim

shareholders increased by 10.5 percent to 394 million Swiss francs, while the cash flow from operating activities, driven by the improved operating EBITDA, increased to 896 million Swiss francs

9) Let us now cover the key financial figures for the first nine months of 2012 Net sales amounted to 16.2 billion Swiss francs, up 4.8 percent compared to the first nine months of 2011 On the pricing side all three product groups recorded encouraging results, hence contributing to top line growth Volume developments offered a somewhat different picture, with volumes in Cement softening during the course of the nine months compared to last year prompted mainly by lower demand in Argentina and Morocco Aggregates and Ready-mix concrete recorded negative year-on-year volume developments mainly in mature markets Continued efforts on the cost side resulted in fixed costs increasing under proportionally, hence partially compensating for the increase in variable costs related to an increase mainly in raw material and energy As a result the operating EBITDA increased by 5.9 percent, or a good 6.4 percent on a like-for-like base Adjusting for the higher CO2 sales of 11 million Swiss francs and the 58 million Swiss francs restructuring costs, the operating EBITDA increased to nearly 3.2 billion Swiss francs, yielding a margin of 19.7 percent compared to the stated 19.4 percent Excluding the one-off impacts from the Holcim Leadership Journey of 98 million Swiss francs on operating profit level and the aforementioned CO2 sales, the operating profit margin reached 12.1 percent compared to the stated 11.6 percent Cash flow from operating activities improved by a good 19.1 percent to 1.1 billion Swiss francs, driven by a higher operating EBITDA and lower taxes paid

Key financial figures – Q3 2012

Due to rounding, numbers presented throughout this report may not add up precisely to the totals provided All ratios and variances are calculated using the underlying amount rather than the

presented rounded amount.

Sales volumes

- Aggregates (mt) 49.2 44.8 -9.6% 0.7% -8.9%

- Ready-mix (mm 3

Net income - shareholders

Million CHF

(if not otherwise stated)

+/-8

Key financial figures – 9M 2012

1 Calculated on the weighted average number of shares outstanding

F Full Year

Sales volumes

- Cement (mt) 144.3 108.1 111.4 2.4% 0.7% 3.0%

- Aggregates (mt) 173.0 130.4 120.3 -8.7% 1.0% -7.7%

- Ready-mix (mm 3 ) 48.4 36.1 35.5 -2.8% 1.1% -1.7%

Operating EBITDA 3'958 2'971 3'147 6.4% 0.1% -0.7% 5.9%

Operating profit 1'933 1'753 1'879 9.4% -1.0% -1.3% 7.2%

Million CHF

(if not otherwise stated)

+/-Net income - shareholders

of Holcim Ltd

9

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Cement – Sales volumes by region

Million t

53.2 56.2 59.5

16.8 18.0 18.5

20.1 20.6 20.1

8.4 8.5 8.9

6.8 6.5 6.4

∆ 9M 11/9M 12 LFL Change in

structure Total

Latin America 3.0% 0.0% 3.0%

North America 4.2% 0.0% 4.2% Africa Middle East -0.9% 0.0% -0.9%

Total Group 9M 2010 102.8 9M 2011 108.1 9M 2012 111.4

10

Aggregates – Sales volumes by region

Million t

structure Total Asia Pacific -4.7% 0.0% -4.7% Latin America -3.3% 0.0% -3.3%

North America -6.9% 2.7% -4.2% Africa Middle East 6.0% 0.0% 6.0%

19.6 22.3 21.2

9.0 10.9 10.6

59.5 63.6 56.2

28.8 31.9 30.6

1.9 1.7 1.8

Total Group 9M 2010 118.8 9M 2011 130.4 9M 2012 120.3

11

Ready-mix concrete and asphalt – Sales volumes by region

Million m 3 /t

9.4 9.8 9.7

7.7 8.2 7.8

Total Asphalt

12.4 12.2

11.1

4.4 4.2 3.5

4.2 5.1

6.0 3.4 3.5 3.1

0.8 0.8 0.9

structure Total Asia Pacific -0.5% 0.0% -0.5% Latin America -5.2% 0.0% -5.2%

North America 10.5% 7.3% 17.8% Africa Middle East 1.4% 0.0% 1.4%

Total Ready-mix

12

Exchange rates

1 Weighted by net sales 9M 2012,

2 Weighted by net sales full year 2011

Statement of income

average exchange rates in CHF 9M 10 9M 11 9M 12 +/-

Statement of financial position

exchange rates in CHF 30/09/11 31/12/11 30/09/12 +/-

13

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7

16) Net sales amounted ot 16.2 billion Swiss francs, representing an overall increase of 4.8 percent

Excluding changes in the scope of consolidation amounting to 0.2 percent and foreign exchange movements contributing a negative 0.3 percent, the like-for-like change amounted to an increase of 4.9 percent On a like-for-like base Group sales benefitted from solid cement volume growth in Group region Asia Pacific, North America and Latin America, while on Group region Africa Middle East recorded sound volume growth

in aggregates Group region North America recorded good growth in ready-mix concrete volumes On a like-for-like base cement prices increased in Group region Asia Pacific, Latin America and to a lesser extent North America, Africa Middle East and Europe Aggregates pricing on a like-for-like base was mainly driven

by Group region Asia Pacific, followed by Europe, North America and Latin America

-178

-228

-435

-916 -854

-508 -244 -140

331

-203 -181

65

-3.1%

-4.3%

-9.2%

-14.9% -15.1%

-9.0%

-5.2%

-2.6%

6.2%

-8.0%

-14.2% -14.7%

-10.5%

6.1%

Net sales impact Operating EBITDA impact

14

Million CHF

Net sales

15

Million CHF

Net sales by region

9M 2010 9M 2011 9M 2012

6020 5929 6579

2587 2467 2613

5136 4691 4434

2449 2151 2394

849 706 726

Million CHF

structure Currency Total Asia Pacific 12.8% 0.2% -2.0% 11.0%

Latin America 7.4% -0.8% -0.7% 5.9%

North America 3.7% 1.8% 5.8% 11.3%

Africa Middle East 2.4% -0.3% 0.8% 2.9%

16

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18) Operating EBITDA nearly reached 3.2 billion Swiss francs, an increase of 5.9 percent This was mainly driven by better prices and a favorable development of the cost base that more than offset the impact from the overall slight volume decline in Aggregates and Ready-mix concrete Adjusting for the slightly negative currency impact of minus 0.7 percent and the changes in the scope of consolidation of 0.1 percent, the operating EBITDA increased by a solid 6.4 percent Excluding the impact from higher CO2 sales of 22 million Swiss francs compared to the previous year’s 11 million Swiss francs and deducting the 58 million Swiss francs related to the Holcim Leadership Journey one-off cash costs, the like-for-like operating EBITDA increased by some 8 percent

19) The Group region Asia Pacific improved its operating EBITDA by 14.5 percent to roughly 1.5 billion Swiss francs despite the weak Indian rupee On a like-for-like base the growth even reached 17.5% Key contributors were Ambuja Cements, Holcim Indonesia, Holcim Australia and Holcim Philippines While slightly lower volumes prevented Holcim Vietnam from reaching last years level, higher costs impacted the financial result of Holcim Malaysia The operating EBITDA in Group region Latin America increased by a good 8.8 percent to 721 million Swiss francs despite inflationary cost pressures in Argentina in addition to higher energy costs in some countries On a like-for-like base the increase amounted to a solid 8.4 percent This result was achieved from a combination of volume growth, partially improved market prices and last but not least the continued cost focus While the Group companies in Colombia, Ecuador, El Salvador and Chile

Net sales by region

Net sales 9M 2012

Europe 26.5%

Asia Pacific 39.3%

Africa Middle East 4.3%

Latin America 15.6%

North

America

14.3%

17

Operating EBITDA

21.6%

Margin Million CHF

3'577

2'971 3'147

3'577

2'971 3'147

18

Operating EBITDA by region

9M 2010 9M 2011 9M 2012

1439

1264 1446

762 662 721

855 707 577

366 264 348

286 237 221

Million CHF

Latin America 8.4% -0.2% 0.7% 8.8%

North America 25.2% 0.3% 6.6% 32.0%

Africa Middle East -7.4% 0.2% 0.1% -7.1%

19

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9

posted substantially better operating results compared to last year, Mexico, Brazil and Argentina were not able to match previous year’s levels due to increasingly challenging market conditions Brazil’s operating result was particularly impacted by adverse currency developments The Group region Europe witnessed an 18.4 percent decline of its operating EBITDA to 577 million Swiss francs On a like-for-like base this decline was only slightly lower at minus 18.2 percent Restructuring costs of 47 million Swiss francs in Spain,

Hungary and UK negatively impacted the operating EBITDA development, while higher CO2 sales of 11 million Swiss francs had a positive impact While the Group companies in Russia and Azerbaijan posted significantly better operating results, Holcim Switzerland, Aggregate Industries UK and Holcim France

recorded lower results compared to last year due to weaker demand Group region North America posted the highest operating EBITDA growth at 32.0 percent and 25.2 on a like-for-like base to 348 million Swiss francs The strengthening of the US Dollar contributed some 6.6 percent to this performance All Group companies posted better operating results Operating EBITDA in Group region Africa Middle East declined

by 7.1 percent to 221 million Swiss francs The decline was largely driven by adverse market conditions and higher production costs in Lebanon The Group companies in Morocco and West Africa managed to match last year's levels

22) Below operating profit, other income amounted to 20 million Swiss francs, up 17 million Swiss francs The contribution from associated companies declined to 73 million Swiss francs, down from 104 million

Operating profit

2'178

1'753 1'879

Margin

Like-for-Like (LFL) -292 -12.5% -139 -6.4% 165 9.4%

Change in structure 103 4.4% -6 -0.3% -17 -1.0%

Forex movements 30 1.3% -280 -12.8% -22 -1.3%

Total change -159 -6.8% -425 -19.5% 126 7.2%

20

Million CHF

Operating profit by region

1

9M 2010 9M 2011 9M 2012

1003 890 1044

608

515 557

377 295 159

95 30 110

245 201 184

Latin America 7.0% -0.2% 1.1% 8.0%

North America 278.9% -20.2% 12.9% 271.5%

Africa Middle East -9.2% 0.5% -0.2% -8.9%

21

Million CHF

Net income

1,223

1,004

1,108 875

9.8%

Net income Net income - shareholders of Holcim Ltd

22

Million CHF

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Swiss francs over first nine months in 2011 with the main driver being the lower profit from the stake in China and Egypt Financial income increased by 28 million Swiss francs to 189 million Swiss francs mainly driven

by higher interest on cash and marketable securities Financial expenses decreased from 606 million to 572 million Swiss francs mainly as a result of lower foreign exchange losses and lower unwinding of discounts on provisions After a tax charge of 482 million Swiss francs, Group net income increased from 1,004 million Swiss francs to 1,108 million Swiss francs Adjusting for non-controlling interests, the net income improved

by 9.8 percent to 783 million Swiss francs

24) The financing requirement for the first nine months of 2012 amounted to 229 million Swiss francs Higher operating EBITDA and lower income taxes more than offset higher working capital needs and financial expenses, thus resulting in a cash flow from operating activities of 1,107 million Swiss francs, up 19.1 percent On a like-for-like base the increase reached 22.7 percent For the first nine months, investments to sustain the asset base decreased to 394 million Swiss francs on a net base, with roughly 75 percent of this being allocated to Cement Expansion investments at 469 million Swiss francs, was down 19.6 percent While around 80 percent of this was invested in Cement, Aggregates and Ready-mix concrete each

accounted for 10 percent These lower investments combined with the dividends paid supported the overall increase of the cash flow generation capacity in the first nine months 2012

Cash flow from operating activities

2'053

12.4%

1'107 930

23

Million CHF

Statement of cash flows

Full Year

Cash flow from operating activities 2,753 930 1'107 19.1%

Net investments to maintain productive

Free cash flow 2,001 502 713 41.8%

Financing surplus/(requirement) 248 -729 -229 68.5%

24

Financial position

Million CHF

Net financial debt Total shareholders' equity Gearing

25

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