Swiss cement group Holcim surprised with a near 50-per cent leap in net profit for the first half of the year today but also reported that sales fell.
The group, which is working to crimp costs, said that the net figure rose by 47.4 per cent to 571 million Swiss francs (460.6 million euros, $ 612.3 million).
Cement and concrete are important indicators of economic activity since they are tied to activity in the construction industry which reacts quickly to the general climate for business and household confidence.
Analysts polled by the AWP agency had broadly expected an outcome of 529 million Swiss francs.
But sales were lower than analysts had expected, totalling 9.6 billion Swiss francs, a fall of 5.1 per cent on a 12-month comparison.
Analysts had expected 9.7 billion Swiss francs.
The group said that sales had fallen because of weak economic conditions.
Sales had been lower than expected in India, its key market in Asia, and also in Canada, Mexico and Morocco.
Another factor had been a hard winter in the northern hemisphere which had crimped activity in the construction industry.
Holcim said that a programme to contain costs was going well. Action to restructure the business was beginning to have a clear effect in Latin America and in Europe.
The company said that it expected sales of cement this year to increase but that sales of aggregates and concrete mix ready for use would be lower than in 2012.
The group stood by its financial targets and said it expected to achieve internal growth of its operating and net profit figures.
However this is more cautious than its outlook at the end of the first quarter of the year when it spoke of achieving a “significant” increase.
At the end of July, French group Lafarge, the biggest cement-maker in the world and Holcim’s main rival, also struck a more cautious note saying that it now expected sales of concrete to rise by 3.0 per cent, having mentioned previously growth of up to 4.0 per cent.