access german swiss austrian conference michel r gerber senior investor relations officer swetlana iodko investor relations officer 2014 holcim

© 2014 Access German, Swiss & Austrian Conference Michel R. Gerber, Senior Investor Relations Officer Swetlana Iodko, Investor Relations Officer © 2014 Agenda DB Access German, Swiss & Austrian Conference - June 11, 2014 Holcim at a Glance Macro Economic Development and the impact for the cement industry Merger between Holcim and Lafarge First quarter 2014 results Outlook 2014 – Conclusions © 2014 Holcim at a glance 130 cement plants around 200 limestone quarries / 450 aggregates operations 1’150 RMX plants in the world > 70’000 employees over 5’000 own RMX trucks / more than 3’000 subcontracted over 1’600’000’000 cement bags sold 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 DB Access German, Swiss & Austrian Conference - June 11, 2014 © 2014 Agenda Holcim at a Glance Macro Economic Development and the impact for the cement industry Merger between Holcim and Lafarge First quarter 2014 results Outlook 2014 – Conclusions DB Access German, Swiss & Austrian Conference - June 11, 2014 © 2014 -6 -4 -2 0 2 4 6 8 10 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013 2015 2017 World Advanced economies Emerging economies GDP at constant prices [annual % change] Forecast Slightly better economic recovery expected, although uncertainty remains, … • Global economic growth is expected to accelerate slowly from 3.0% in 2013 to 3.6% in 2014 and 3.9% in 2015 (IMF April 2014) • Major developed countries to expand simultaneously for the first time in several years • Emerging markets, on balance, should perform better in 2014 Source: IMF World Economic Outlook April 2014 Change in GDP Forecast [January '14 to April'14] ‐0.6 ‐0.5 ‐‐ 0.1 ‐0.1 ‐‐ 0.4 ‐0.2 ‐0.2 ‐‐ 0.1 ‐0.1 ‐ ‐ 0.3 2014 2015 [annual %change] DB Access German, Swiss & Austrian Conference - June 11, 2014 © 2014 fundamental trends support our business … The right place to be Population growth Continued urbanization Economic growth DB Access German, Swiss & Austrian Conference - June 11, 2014 © 2014 Europe 37% 45% 55% 22% 78% 16% 84% North America 10% 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% 1990 2013E 2030E 1990: ~0.8 Bn t 2013E: ~1.7 Bn t 2030E: ~2.7 Bn t 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 US DB Access German, Swiss & Austrian Conference - June 11, 2014 © 2014 Regional Construction Market Growth Forecast [CAGR] 7.1% 1.7% 6.5% 5.6% 4.9% 2.1% 6.6% 8.3% 8.7% 6.0% 5.9% 6.0% 1.4% 4.9% 4.2% 3.7% 0.9% 5.3% 7.2% 7.5% 4.9% 5.0% Total WesternEu rop e EasternEu rope North America South&CentralAm erica As iaPacif ic('developed') As iaPacif ic('emergin g' w/oIndia&China)) China India Middl eEast&North Africa Sub‐SaharanAfrica PreviousFC[CAGR2010‐2020] CurrentFC[CAGR 2013‐2025] ‐1.1% ‐0.3% ‐1.5% ‐1.4% ‐1.2% ‐1.1% ‐1.3% ‐1.1% ‐0.9% No te:Pre viousFCbasedonUSD2010prices&Curre ntFCbasedonUS D2012pri ces Change ‐1.1% ‐1.2% • Long term growth prospects remain positive for the majority of the regional construction sectors, driven by sound fundamentals and mega-trends • Following the pattern of expected slower GDP growth, growth projections for the sector are still strong • The compounded annual growth rate (CAGR) in construction spend is expected to be 6% for the period from 2013 to 2025 Oxford Economics remains positive on the long term prospects of the global construction sector Source: Oxford Economics - Global Construction Perspectives 2020 (March 2011) and 2025 (July 2013) DB Access German, Swiss & Austrian Conference - June 11, 2014 © 2014 China and North America will attract most of the additional construction spend, followed by Emerging Asia and India • In nominal dollar terms, China, North America, Emerging Asia and India are expected to attract more than two thirds of global construction spend • China is a growth driver with more than a third of 2013- 2025 value growth potential [36% TOT] • North America is expected to regain momentum driven by economic recovery and population growth [15% TOT] • New Asian Tigers (Indonesia, South Korea, Vietnam and Philippines) is expected see significant growth over the period - Indonesia is expected to become the worlds third largest housing market [12% TOT] • India considerable growth potential [9% of TOT] • Latin America (excl. Mexico) will grow at a relatively low rate [6% of TOT] • Weak economic fundamentals in Western Europe and stagnant population will result in low but stable growth [5% TOT] • Eastern Europe (driven by Russia and Turkey) is expected to grow almost as much as India [8% TOT] • Africa with significant growth rates, however small overall Source: Oxford Economics - Global Construction Perspectives 2025 (July 2013) Global Construction Market [2013-2025] 2'182 914 746 566 489 353 340 314 125 95 Chi na North America AsiaPacific ('em er ging' w/oIndia&Chin a)) India Eastern Euro pe South& CentralAmerica Mid dleEast &NorthAfrica We stern Euro pe AsiaPaci fic (' develope d') Sub‐Sa haran Africa 2013‐2025 Change  in USD bn No te: FCba sedonUSD2012pri ces 36% 15% 12% 9% 8% 6% 6% 5% 2% 2% %‐share in Globalgrowth USD bn in2013 1'677 1'442 783 409 628 650 6% 1'711 1'050 118 DB Access German, Swiss & Austrian Conference - June 11, 2014 © 2014 5 60 17 26 26 11 19 3 5 68 4 12 7 11 Holcim cement capacity as of December 31, 2013: 206 Mt * China not consolidated Over the past 10 years Holcim invested about CHF 35 billion to establish a global footprint unmatched in the industry Well positioned to address growth in cement demand DB Access German, Swiss & Austrian Conference - June 11, 2014 [...]... Swiss & Austrian Conference - June 11, 2014 © 2014 Contact information and event calendar Contact information Event calendar Bernhard A Fuchs Michel R Gerber Swetlana Iodko July 30, 2014 Half-year results for 2014 November 3, 2014 Press and analyst conference for the third quarter 2014 November 18, 2014 Investor Day in Zurich Investor Relations Phone +41 58 858 87 87 Fax +41 58 858 80 09 investor. relations@ holcim. com... 348 RMC volume sold (mm3) 31 39 70 DB Access German, Swiss & Austrian Conference - June 11, 2014 © 2014 Unique Value Proposition for Shareholders • • • • • New best-in-class global portfolio Superior growth and operating profitability Significant synergies Strict capital allocation discipline and strong capital structure Attractive returns for shareholders DB Access German, Swiss & Austrian Conference. .. 2015 DB Access German, Swiss & Austrian Conference - June 11, 2014 © 2014 Agenda Holcim at a Glance Macro Economic Development and the impact for the cement industry Merger between Holcim and Lafarge First quarter 2014 results Outlook 2014 – Conclusions DB Access German, Swiss & Austrian Conference - June 11, 2014 © 2014 Q1 2014 Milestones • Like-for-like sales increase in all segments • Strong momentum... 9.3% © 2014 Agenda Holcim at a Glance Macro Economic Development and the impact for the cement industry Merger between Holcim and Lafarge First quarter 2014 results Outlook 2014 – Conclusions DB Access German, Swiss & Austrian Conference - June 11, 2014 © 2014 Outlook for 2014 • Holcim expects cement volumes to increase in all Group regions • Aggregates volumes expected to remain flat overall as increases... 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 DB Access German, Swiss & Austrian Conference - June 11, 2014 © 2014 Operational Synergies Source » • » Estimated run-rate synergies Operational... impact for the cement industry Merger between Holcim and Lafarge First quarter 2014 results Outlook 2014 – Conclusions DB Access German, Swiss & Austrian Conference - June 11, 2014 © 2014 Geographical Complimentarity of Portfolios Combined sales by region Emerging markets (in billion) CHF 11.0 / EUR 9.0 51% Developed markets Total 73 17 90 # of countries 5.6 49% CHF 8.6 / EUR 7.0 5.4 CHF 7.0 / EUR 5.7... immediately Divestments • Process to start immediately Integration Preparation • Prepare an integration plan for implementation straight after closing of the transaction Regulatory Approvals • Regulatory proceedings initiated in all relevant jurisdictions shortly Shareholder Approval and Acceptances • After regulatory approvals:  Holcim EGM approvals  Launch public exchange offer Transaction Closing expected... further expansion in operating margins DB Access German, Swiss & Austrian Conference - June 11, 2014 © 2014 Conclusions • 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... and NNS fully support the transaction Timetable • Transaction closing expected in H1 2015 Value proposition DB Access German, Swiss & Austrian Conference - June 11, 2014 © 2014 Best-in-Class Portfolio for Growth • • Emerging Markets • 60% of pro forma sales 13 countries out of our Top 20 with strong infrastructure needs2 6% CAGR for construction outputs expected until 20253 Portfolio breakdown (2013 sales)1... CHF 240 m / EUR 200 m (over time) CHF 250 m / EUR 200 m CHF 1.7 bn / EUR 1.4 bn CHF 500 m / EUR 410 m (over 3 years) Sharing of best practices DB Access German, Swiss & Austrian Conference – June11, 2014 - © 2014 CHF 1.7 bn / EUR 1.4 bn run-rate synergies Pre-tax Synergies (CHF bn / EUR bn) – Phased in over 3 years CHF 1.7 / EUR 1.4 0.2/0.1 CHF 0.7 / EUR 0.5 0.2/0.1 0.2/0.1 CHF 0.1 / EUR 0.0 0.2/0.1 . © 2014 Access German, Swiss & Austrian Conference Michel R. Gerber, Senior Investor Relations Officer Swetlana Iodko, Investor Relations Officer © 2014 Agenda DB Access German, Swiss. consumption growth driven by emerging markets and recovery in Europe and US DB Access German, Swiss & Austrian Conference - June 11, 2014 © 2014 Regional Construction Market Growth Forecast [CAGR] 7.1% 1.7% 6.5% 5.6% 4.9% 2.1% 6.6% 8.3% 8.7% 6.0% 5.9% 6.0% 1.4% 4.9% 4.2% 3.7% 0.9% 5.3% 7.2% 7.5% 4.9% 5.0% Total WesternEu. discipline and strong capital structure • Attractive returns for shareholders DB Access German, Swiss & Austrian Conference - June 11, 2014 © 2014 Deal structure Company name Key Transaction Highlights •