canadian fixed-income investor update 2014 michel r gerber senior investor relations officer swetlana iodko investor relations officer holcim ltd

Financial positioning and financing Merger between Holcim and Lafarge Outlook 2014 - Conclusions... Financial positioning and financing Merger between Holcim and Lafarge Outlook 2014 -

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Strength Performance Passion

Canadian fixed-income investor update

IFZ - MAS Corporate Finance 20_10 – Funding

December 7, 2012, 14.10 – 17.50

Michel R Gerber, Senior Investor Relations Officer

Swetlana Iodko, Investor Relations Officer

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Financial positioning and financing

Merger between Holcim and Lafarge

Outlook 2014 - Conclusions

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Presence on all five continents and in around 70 countries

2013 Net sales of CHF 19.7 bn and operating EBITDA of CHF 3.9 bn

Canadian fixed-income investor update, 2014-05-26 3

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Fundamental trends support our business …

The right place to be

Population

growth

Continued urbanization Economic growth

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Canadian fixed-income investor update, 2014-05-26

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Europe 37%

Asia

Pacific

30%

Latin America 8%

Africa Middle

East 14%

Europe 18%

North America 6%

Latin America 11%

Asia Pacific 38%

Africa Middle East 27%

Europe 13%

North America 5% Latin America 10%

Asia Pacific 42%

Africa Middle East 29%

Cement demand split mature vs emerging markets

Cement demand evolution by region (excl China)

Mature Emerging Source: BMI, National cement associations, Holcim estimates

… resulting in long-term cement consumption growth driven

by emerging markets and recovery in Europe and the US

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Over the past 10 years, Holcim invested about CHF 35 billion to establish a global

footprint which is unique in the industry

Well positioned to address growth in cement demand

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organic and inorganic growth

initiatives

CAPEX and financial

investments

ongoing projects) sufficient to

capture growth

existing plants coupled with

ongoing cost reduction initiatives

resulting in higher ROIC

Value creation from our existing asset base

-500 500 1'500 2'500 3'500 4'500 5'500 6'500

Cash flow from operating activities CAPEX Financial (de)/investments

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Macro economic development and the impact for the cement industry

First quarter 2014 results, Holcim Leadership Journey

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improvement

operating EBITDA and further reduction in NWC

Czech Republic

advanced Group in the building materials industry

Q1 2014 Milestones

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The five areas of operating profit growth by 2014

Customer Excellence CHF 500 million

Energy and AFR

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Holcim Leadership Journey is on track

All figures in million CHF

2014

cum Target

achieved cumulative since 2012

2012 2013

4) excluding CHF 16 million of restructuring costs in Europe (mainly Spain)

3) Original amount w as projected < CHF 120 million for 2013; having spent already CHF 239 million, no additional restructuring cash costs are foreseen at this stage

achieved achieved 3M

1) The base line is the financial year 2011 amounting to CHF 2'308 million (excluding one-off charges 2011 of CHF 375 m and w ithout fluctuations in currency, changes

in scope of consolidation and similar market conditions) Adjusted for the sale of 25% of Cement Australia and Siam City Cement, the new base is CHF 2'193 million

2) Additional CAPEX net comes from prioritization of CAPEX based on the speed of the returns (ROIC).

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<1y 1-2y 2-3y 3-4y 4-5y 5-6y 6-7y 7-8y 8-9y 9-10y >10y

Loans Capital markets

Financial debt, maturities and liquidity as of March 31, 2014

Maturity profile 1 (mCHF)

1 After risk-related adjustments of CHF 392 million from current financial

liabilities to long-term financial liabilities

Liquidity summary

• Cash + marketable securities: CHF 2,016 million

• Cash + marketable securities + unused committed credit lines: CHF 6,558 million

Debt summary

• Current financial liabilities 1 : CHF 2,493 million

• Fixed to floating ratio: 58% to 42%

• Capital markets 79%; Loans 21%

• Corporate vs subsidiary debt: 81% to 19%

• Ø total maturity: 5.2 years

• CP borrowings: CHF 466 million

• No financial covenants in Corporate credit lines

ST/LT ratings summary as of April 28, 2014

• S&P Credit Rating: A-2 / BBB, outlook stable

• Fitch Credit Rating: F2 / BBB, outlook stable

• Moody’s Credit Rating: P2 / Baa2, outlook negative

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Overall debt reduced by CHF 6.6 billion since 2008

Share of capital market financing at around 80%

Loans Capital markets Share of capital market financing (r.h scale)

Share of capital market financing

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Access to a wide range of capital markets – only CHF 0.9 bn

of capital markets instruments maturing until year-end 2014

Capital markets funding distribution as per Q1 2014 Capital market maturities Q1 2014 – 2015

Mar-15Apr-15Jul-15Nov-15Dec-15

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Q4 06

Q4 07

Q4 08

Q4 09

Q4 10

Q4 11

Q4 12

Q4 13

Average maturity substantially increased to 5.2 years with long-dated bonds in USD, EUR and CHF

USD 50 m bond (20 years)

USD 500 m bond (10 years) USD 250 m bond (30 years)

Major capital market transactions since January 1, 2013

Average maturity of financial liabilities (in years)

CHF 250 m bond (8.5 years)

EUR 500 m bond (10 years)

Amendment and extension EUR 2.0 bn Syndicated Revolving Committed Credit Facility

Target

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Developed

# of

Note: pre-disposals, pre-group elimination, post regional elimination

Combined sales by region

(in billion)

3.8 3.2

Asia

61%

39%

CHF 8.6 / EUR 7.0

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Unique value proposition for shareholders

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• Company domiciled in Switzerland

• Capitalise on developed markets recovery

• Divestments of assets representing CHF 6bn / EUR 5bn of sales

• 60% exposure to emerging markets post divestments

• No country above c 10% of sales

• Boards of both companies have unanimously approved the transaction

• Thomas Schmidheiny, GBL and NNS fully support the transaction

• Best growth platform in the industry and superior operating profitability

• CHF 1.7bn / EUR 1.4bn of run-rate synergies

• Strict capital allocation discipline and strong financial structure:

targeted solid Investment Grade credit ratings

• Attractive dividend payout policy

• Exchange ratio of 1 Holcim share for 1 Lafarge share

• Transaction closing expected in H1 2015

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• 60% of pro forma sales

• 13 countries out of our Top 20 with strong infrastructure needs2

• 6% CAGR for construction outputs expected until 20253

Developed

markets

• 40% of pro forma sales

• Significant recovery potential

LatAm

c 60% Emerging markets

Eastern Europe

c 40% Developed markets

Western Europe

Capturing the recovery in developed markets while ensuring long-term sustainable growth in emerging markets

1 Pro forma of divestments

2 Ranked below 50 in the World Economic Forum Global Competitiveness index for quality of overall infrastructure 2012-2013

3 Global Construction 2025 - A global forecast for the construction industry to 2025

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Operational synergies

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» Operational optimisation / best practices

• E.g logistics, distribution, IT, energy consumption CHF 240 m / EUR 200 m

» Procurement

• Savings in overlapping countries

• Economies of scale in centralized procurement for

selected categories

» Selling, General and Administrative

» Innovation deployed on a larger scale

• Cross-fertilization of value-added product portfolios

CHF 410 m / EUR 340 m

CHF 300 m / EUR 250 m

CHF 240 m / EUR 200 m

CHF 1.2 bn / EUR 1.0 bn Total synergies at EBITDA level

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Financing and cash flow synergies

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» Financing savings CHF 120 m / EUR 100 m (from end of year 1)

Up to CHF 240 m / EUR 200 m (over time)

» Capital expenditures

• Best practice on maintenance capex

• Higher efficiency on expansion capex

» Working capital savings

• Sharing of best practices

CHF 250 m / EUR 200 m

CHF 500 m / EUR 410 m (over 3 years)

CHF 1.7 bn / EUR 1.4 bn Total synergies

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Operational Synergies Financing Synergies Capex Synergies Implementation Costs Working Capital Savings

CHF 0.1 / EUR 0.0

CHF 0.7 / EUR 0.5

CHF 1.7 / EUR 1.4 CHF 1.7 / EUR 1.4 Pre-tax synergies (CHF bn / EUR bn) – phased in over 3 years

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Key steps to closing

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Works council

consultations • Lafarge and Holcim works council consultations initiated immediately

Divestments • Process to start immediately

• After regulatory approvals:

 Holcim EGM approvals

 Launch public exchange offer

Transaction closing expected in H1 2015

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• Holcim expects cement volumes to increase in all Group regions

• Aggregates volumes expected to remain flat overall as increases in Asia Pacific, Europe, North America, and Africa Middle East are offset

by negative volumes in Latin America

• Ready-mix concrete volumes also expected to increase in most

regions with the exception of Europe and Latin America

• Holcim expects that organic growth in operating profit can be

achieved in 2014

• The ongoing focus on the cost base coupled with all the benefits

expected from the Holcim Leadership Journey will lead to a further expansion in operating margins

Outlook for 2014

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• Cement consumption growth driven by emerging markets and

recovery in Europe and US

• Holcim with current footprint well positioned to address growth in

cement demand without adding any significant new capacities

• The proposed merger with Lafarge will add significant value for all stakeholders

• The unmatched global footprint of the combination between Holcim and Lafarge will lead to less additional capital for expansion and

therefore even more attractive returns to shareholders

• The ongoing focus on the cost base coupled with all the benefits

expected from the Holcim Leadership Journey will lead to a further expansion in operating margins in 2014 and beyond

Conclusions

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quarter results for 2014

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Disclaimer

Cautionary statement regarding forward-looking statements

This presentation may contain certain forward-looking statements relating to the Group’s future business, development and economic performance

Such statements may be subject to a number of risks, uncertainties and other important factors, such as but not limited to (1) competitive pressures; (2)

legislative and regulatory developments; (3) global, macroeconomic and

political trends; (4) fluctuations in currency exchange rates and general

financial market conditions; (5) delay or inability in obtaining approvals from authorities; (6) technical developments; (7) litigation; (8) adverse publicity

and news coverage, which could cause actual development and results to

differ materially from the statements made in this presentation Holcim

assumes no obligation to update or alter forward-looking statements whether

as a result of new information, future events or otherwise

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