LafargeHolcim improves outlook, lifts dividend

Friday, 18. November 2016 10:35

Giant cement maker LafargeHolcim said on Friday that it intends to buy back shares worth one billion Swiss francs within the next two years, expressing confidence in the strength of the portfolio and cash-generating potential. Besides from announcing the possibility of special dividends to return excess cash to investors, the company headquartered in the town of Jona said it will increase the dividend from 1.5 to two francs next year and further from there. The press release noted the target for the average payout ratio is 50%.

Cost savings worth an additional 200 million francs would bring the earnings before interest, tax, depreciation and amortization before restructuring costs, or adjusted operating EBITDA, to seven billion francs in 2018, the company said and noted the segment is adjusted for the divestment program worth five billion francs and foreign exchange movements. The new figure compares to the target headline operating EBITDA of at least eight billion francs for the same year and the adjusted figure of 5.75 billion francs achieved in 2015. 

The company dropped 1.82% to 53.9 francs at 10:16 a.m. CET in Zurich, compared to the weakening of benchmark SMI index by 0.39%. Lafarge was by far the worst performer, followed by Roche, which shed 0.81%. The building materials maker earlier dipped as low as 52.95 francs.

Image: EPA / Steffen Schmidt

Related Links: LafargeHolcim Ltd.
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