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Holcim Reports Higher EBIT Amid Lower Net Sales and Profit

Holcim Group shares rise as recurring EBIT and margins improve, despite a decline in net profit and sales. The company's outlook for fiscal 2025 is optimistic, with expected growth in EBIT and a proposed dividend increase.

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AI Rating:   6
Earnings Per Share (EPS)
Holcim reported earnings per share of 5.24 francs, which is a decrease of 2.3 percent from the previous year's EPS of 5.37 francs. However, adjusted EPS improved to 5.70 francs compared to 5.42 francs from last year, indicating a positive trend in adjusted earnings despite the decline in basic EPS.

Net Income
The net income for Holcim dropped 4.4 percent to 2.93 billion francs, down from 3.06 billion francs last year. This decline in net income could raise concerns among investors, as it reflects a negative performance compared to the previous fiscal year.

Recurring EBIT and Profit Margins
Despite the decrease in net income and sales, recurring EBIT grew by 6.1 percent to 5.05 billion francs, and the recurring EBIT margin improved to 19.1 percent from 17.6 percent a year ago. This indicates that the company is managing its operational efficiency well, which can be viewed positively by investors.

Revenue Growth
While net sales decreased by 2.2 percent to 26.41 billion francs, local currency sales witnessed a growth of 1.3 percent when compared to last year, showcasing resilience in performance within certain local markets. The organic sales growth reported was minimal at 0.2 percent.

Future Outlook
Looking forward, Holcim's emphasis on profitable growth, increasing recurring EBIT, and a proposed 11 percent increase in dividends to 3.10 Swiss francs per share may positively influence investor sentiment. Furthermore, the planned spin-off of the North American business and the expected listing on the stock exchange are strategic moves that could enhance future performance and returns for shareholders. Overall, the company is positioned for growth even with the current challenges.
Stocks:  HOLCIM