© Holcim Ltd 2011 BAML Pan European Building Conference 2011 Thomas Aebischer – Chief Financial Officer John M. Feigl – Investor Relations Officer October 11 th , 2011 © Holcim Ltd 2011 Agenda 1 Strategy & positioning based on long term growth 2 Differentiators – sustainability & talent management 3 Ready to shift gears – cash generation capacity 4 Conclusions 3 © Holcim Ltd 2011 BAML Pan European Building Conference 2011 Founded 1912, Holcim expanded over time and is present today in the most attractive construction markets worldwide 1940 1960 1970 1980 2000 2010 1930 1990 October 11, 2011 4 © Holcim Ltd 2011 • Two basic resources Cement Aggregates • Value-adding products and services Ready-mix concrete Asphalt Concrete products Holcim strategy… …the effective execution is the base for success 1 Reported as per 2010 Product Focus Geographic Diversification Local Management Global Standards • Truly global • Balanced between regions mature / emerging markets • Business – strongly anchored in local markets • ~ 2500 locations • Supported by global standards Policies & directives Exchange of know how & best practices / benchmarking Latin America Africa Middle East Asia Pacific Europe North America Net sales 1 Op. EBITDA 1 29.3% 22.3% 14.6% 15.5% 4.9% 35.7% 7.7% 38.9% 21.3% 9.8% BAML Pan European Building Conference 2011 October 11, 2011 5 © Holcim Ltd 2011 Our geographic portfolio captures the long term demand drivers Population growth (2010 – 2050) Urbanization (2010 – 2050) Refurbishment (2010 – 2050) Holcim sales split development Holcim operating EBITDA split development •Additional 2 billion people (+40%) in emerging markets •No growth between 2010 and 2050 on average in mature markets •Emerging markets: Urban population + 103% / Rural population -14% •Mature markets: Urban population + 18% / Rural population -43% Key drivers for continued growth •Emerging markets: Infrastructure void and generally inadequate in many markets / modernization projects •Mature markets: Huge need for major modernization / replacement projects Source: United Nations (World Urbanization Prospects & World Population Prospects - 2010), Oxford Economics (2009) 0% 25% 50% 75% 100% 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 HY 2011 Emerging Markets Mature Markets 0% 25% 50% 75% 100% 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 HY 2011 Emerging Markets Mature Markets BAML Pan European Building Conference 2011 October 11, 2011 6 © Holcim Ltd 2011 0 1 2 3 4 5 6 1950 1955 1960 1965 1970 1975 1980 1985 1990 1995 2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 2050 Population bn Urban mature markets Urban emerging markets Rural mature markets Rural emerging markets “Popurbanization” = population growth + urbanization shifts the urban population from ~ 50% to ~ 70% in 2050 Source: United Nations (World Urbanization Prospects - 2010) 2010: ~ 50% urban 2050: ~ 70% urban BAML Pan European Building Conference 2011 October 11, 2011 7 © Holcim Ltd 2011 0 1'000 2'000 3'000 4'000 5'000 6'000 7'000 GDP / capita emerging markets USD / capita 2010 2020E 0 10'000 20'000 30'000 40'000 50'000 60'000 70'000 80'000 90'000 2010 2020E USD bn Mature markets Emerging markets The boost in demand will be strongly driven by the evolving middle class in the emerging markets… Sources: Oxford Economics, November 2010, The Economist, Pocket World in Figures, 2011, Euromonitor International, March 2010 + 8 3 % + 2 0 % 4 . 6 % C A G R + 5 6 . 5 % GDP development GDP / capita development • Between 2010 and 2020 China and India for example are expected to see the number of middle class households increase from around 150 million to over 300 million BAML Pan European Building Conference 2011 October 11, 2011 8 © Holcim Ltd 2011 Global construction outlook still rock-solid and dynamic! With a presence in 14 of the top construction markets, Holcim is well positioned to capture growth opportunities Largest construction markets (global ranking) Source: Global Construction 2020, Global Construction Perspectives, Oxford Economics, March 2011 2009 2010 2020E USA 1 2 2 China 2 1 1 Japan 3 3 4 Germany 4 5 8 Spain 5 8 10 France 6 6 7 Italy 7 9 11 South Korea 8 14 <15 India 9 4 3 UK 10 10 12 Canada 11 7 5 Brazil 12 13 13 Australia 13 11 9 Russia 14 <15 14 Indonesia 15 12 6 Mexico <15 15 15 BAML Pan European Building Conference 2011 October 11, 2011 © Holcim Ltd 2011 Agenda 1 Strategy & positioning based on long term growth 2 Differentiators – sustainability & talent management 3 Ready to shift gears – cash generation capacity 4 Conclusions 10 © Holcim Ltd 2011 756 689 620 608 597 600 567 500 550 600 650 700 750 800 1990 2000 2007 2008 2009 2010 2015 Sustainable Development is our license to operate and it makes good business sense Holcim kg CO 2 /tonne cement) 1 International Union for the Conservation of Nature • Three main levers to reduce CO 2 Modern plants Usage of alternative fuels Reduction of clinker content • Reducing CO 2 emissions goes hand in hand with improving: Energy consumption Natural resources Emissions of NO X , SO 2 , dust… • Sustainable quarry management and responsible biodiversity management including a partnership with the IUCN • Leadership in Sustainable Development is externally recognized Exceeded our target of >20% reduction (21% in 2010) New target is a 25% reduction by 2015 > 25% BAML Pan European Building Conference 2011 October 11, 2011 [...]... cement capacity has come on stream since 2008 Further 10.4 million tonnes by 2014 18 © Holcim Ltd 2011 BAML Pan European Building Conference 2011 October 11, 2011 Mature market recovery combined with emerging market growth offer substantial operating EBITDA potential Mature markets Emerging markets US Europe Emerging markets Infrastructure replacement Infrastructure replacement Growth capacity expansion... lend ample financial flexibility to grasp growth opportunities Holcim – ready to shift gears 21 © Holcim Ltd 2011 BAML Pan European Building Conference 2011 October 11, 2011 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... John M Feigl November 9, 2011 Press and analyst conference for the third quarter 2011 February 29, 2012 Press and analyst conference for the annual results for 2011 April 17, 2012 General meeting of shareholders May 9, 2012 First quarter results for 2012 Investor Relations Phone +41 58 858 87 87 Fax +41 58 858 80 09 investor. relations@ holcim. com www .holcim. com/investors Mailing list: www .holcim. com/subscribe... 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 22 © Holcim Ltd 2011 BAML Pan European Building Conference 2011 October 11, 2011 Contact information and event calendar Contact information Event calendar... Commitment to the client’s goals Customized RMX batching plant on site Maximized use of rail and water logistics Dedicated an on-site member of staff 11 © Holcim Ltd 2011 BAML Pan European Building Conference 2011 October 11, 2011 Talent – Ensure we have the best people in the right jobs • Attract the best talent and promote from within • Hire for attitude and leverage diversity to maximize... 2004 2005 Maintenance (CHF 10.7 bn) 2006 2007 2008 2009 2010 Expansion (CHF 13.5 bn) A stringent focus on efficiency improvements and asset divestments contributed to the financing of expansion capex and thus a considerable increase of capacities of 32 mt (2008 – 2014) 16 © Holcim Ltd 2011 BAML Pan European Building Conference 2011 October 11, 2011 Holcim investment criteria secures long-term returns... training, leadership and management education • Active succession planning enhances performance Strength Performance Passion 12 © Holcim Ltd 2011 BAML Pan European Building Conference 2011 October 11, 2011 Succession planning – translating talent potential into performance • A formal process of succession management creates a supply of the best people for key roles • Ongoing management task to develop... policy • Investment scorecard • Accountability Success factor – rigorous investment analysis and discipline 17 © Holcim Ltd 2011 BAML Pan European Building Conference 2011 October 11, 2011 Our expansion program has created a growth portfolio of highly efficient, low-cost, environmentally friendly capacity Capacity expansions* Completed Under construction or planned * As per August 2011 21.7 million of... senior management level in the last three years • Over 20 new local top-level executives appointed in the last 18 months • Succession planning for senior management positions is a regular Board agenda item 13 © Holcim Ltd 2011 BAML Pan European Building Conference 2011 October 11, 2011 Agenda 1 Strategy & positioning based on long term growth 2 Differentiators – sustainability & talent management 3... capacity expansion ~ CHF 500 m ~ CHF 1 bn ~ CHF 500 m Additional operating EBITDA potential of around CHF 2 bn 19 © Holcim Ltd 2011 BAML Pan European Building Conference 2011 October 11, 2011 Agenda 1 Strategy & positioning based on long term growth 2 Differentiators – sustainability & talent management 3 Ready to shift gears – cash generation capacity 4 Conclusions © Holcim Ltd 2011 Conclusions • Consistent . © Holcim Ltd 2011 BAML Pan European Building Conference 2011 Thomas Aebischer – Chief Financial Officer John M. Feigl – Investor Relations Officer October 11 th , 2011 © Holcim Ltd 2011 Agenda 1 Strategy. 2010 CHF m Maintenance (CHF 10.7 bn) Expansion (CHF 13.5 bn) BAML Pan European Building Conference 2011 October 11, 2011 17 © Holcim Ltd 2011 Holcim investment criteria secures long-term returns Success. since 2008. Further 10.4 million tonnes by 2014 BAML Pan European Building Conference 2011 October 11, 2011 19 © Holcim Ltd 2011 Mature market recovery combined with emerging market growth offer