Final Results
Compagnie de Saint-Gobain
24 March 2006
March 23, 2006
press
release
FINAL RESULTS FOR 2005: Confirmation of the figures published at the
end of January 2006
2005: ANOTHER YEAR OF GROWTH
Excluding the impact of British Plaster Board (BPB), consolidated at December 1, 2005:
O SALES +8.4% (to EUR 34,873 million)
O OPERATING INCOME +4.6% (to EUR 2,868 million)
O BUSINESS INCOME +8.0% (to EUR 2,611 million)
O NET INCOME +6.4% (to EUR 1,318 million)
Including the impact of the consolidation, at December 1, 2005, of British Plaster Board (BPB), together with the
one-off items associated with this acquisition
O SALES +9.1% (to EUR 35,110 million)
O OPERATING INCOME +4.3% (to EUR 2,860 million)
O BUSINESS INCOME +5.6% (to EUR 2,554 million)
O NET INCOME +2.0% (to EUR 1,264 million)
DIVIDEND FOR 2005 (recommended for approval by the AGM): EUR 1.36 per share, up 6.3%.
2006: OBJECTIVES CONFIRMED
O Between 23% and 25% growth in operating income at constant exchange rates*
O Between 18% and 20% growth in net income excluding profit (loss) on sales of non-current assets
O Continuing strong free cash flow levels
(*) based on average 2005 exchange rates
At its meeting of Thursday March 23, 2006, the Board of Directors of
Saint-Gobain adopted the Group's consolidated financial statements for 2005.
- Analysis of the 2005 key consolidated data:
The key consolidated data for the Group, as well as the results by business
sector and geographical area set out in the appendix, are (with the exception of
net debt diminishing by €3M), the same as the estimated figures published at the
end of January(**). These figures are as follows:
2004 2005 % Change 2005
(IFRS) (excl. BPB) (incl. BPB)
In EUR In EUR In EUR
millions millions millions
(1) (2) (2)/(1) (3)
Net sales* 32,172 (a) 34,873 (a) +8.4% 35,110 (a)
Operating income 2,743 2,868 +4.6% 2,860
Non-operating costs (271) (252) -7.0% (288)
Other business income and expenses (54) (5) n.m. (18)
Business income 2,418 2,611 +8.0% 2,554
Net financial income (expense) (535) (550) +2.8% (569)
Income taxes (616) (721) +17.0% (701)
Share in net income of equity investees 8 8 n.m. 10
Income before minority interests 1,275 1,348 +5.7% 1,294
Minority interests (36) (30) -16.7% (30)
Net income 1,239 1,318 +6.4% 1,264
Earnings per share (in EUR) 3.63 3.82 +5.2% 3.66
Net income excluding profit (loss) on sales of 1,289 1,328 +3.0% 1,284
non-current assets
Earnings per share excluding profit (loss) on 3.78 3.85 +1.9% 3.72
sales of non-current assets (in EUR)
Cash flow from operations 2,639 2,767 +4.9% 2,735
Cash flow from operations excluding capital gains 2,635 2,767 +5.0% 2,730
tax
Capital expenditure 1,540 (b) 1,705 (b) +10.7% 1,756 (b)
Investments in securities 899 (c) 1,208 (c) +34.4% 7,137 (c)
Depreciation and amortization 1,374 1,396 +1.6% 1,420
Net debt 6,218 6,571 +5,7% 12,850
(a) including ancillary revenue of EUR 250 million in 2005, up from EUR 190
million in 2004.
(b) excluding capital leases of EUR 21 million in 2005, down from EUR 28 million
in 2004
(c) including share buy-backs of EUR 146 million in 2005 vs. EUR 241 million in
2004.
All of the comments made at the end of January (**) about the Group's
consolidated financial statements therefore apply to the final figures.
* * *
(**) The press release relating to the Group's estimated 2005 results -
published at the end of January 2006 - is available on the Saint-Gobain website
at www.saint-gobain.com.
Asbestos claims against CertainTeed in the United States:
The Group confirms the figures and comments relating to 2005, published at the
end of January (**) concerning this issue.
Regarding the legislative effort to create a Federal asbestos trust fund, a
Senate vote held in mid-February to waive a technical budgetary requirement
failed to obtain the 60 votes needed to proceed to a debate and ultimate vote on
the merits of the Bill. Although there are some continuing efforts to revive
the Bill, the probability of success seems to be remote.
In the meantime, the publicity surrounding the broken asbestos tort system in
the U.S. has prompted a number of States to consider and adopt medical criteria
requirements and tort reform measures designed to reduce abuses of the system.
* * *
- Annual General Meeting:
The Board of Directors also adopted the accounts of Compagnie de Saint-Gobain,
the parent company. Net income amounted to EUR 525 million for the year ended
December 31, 2005, compared with EUR 766 million for 2004 which beneficiated
from the dividend received because of the profit on sales of Terreal divested in
2003.
At the General Meeting of the Company's shareholders, called for June 8, 2006,
the Board will recommend the distribution of EUR 460 million (representing 35.8%
of net income excluding capital gains). The dividend per share would therefore
amount to EUR 1.36, an increase of 6.3% over last year. Based on the closing
share price on December 30th 2005 (€50.25), this dividend would represent a
gross yield of 2.71%. The dividend will be paid entirely in cash as from June
22, 2006.
- 2006 outlook and objectives: the Group confirms that in 2006 it
will aim to achieve between 23 and 25% growth in operating income at constant
exchange rates (average 2005 exchange rates), and between 18 and 20% growth in
net income, excluding profit (loss) on sales of non-current assets. The group
also aims to maintain strong free cash flow levels.
(**) The press release relating to the Group's estimated 2005 results -
published at the end of January 2006 - is available on the Saint-Gobain website
at www.saint-gobain.com.
Forthcoming results announcement:
- Sales for the first quarter of 2006 : April 27, 2006, after close of trading
on the Paris stock-exchange.
Investor Relations Department
Mrs. Florence Trious-Teixeira Tel.: +33 1 47 62 45 19
Mr. Alexandre ETUY Tel.: +33 1 47 62 37 15
Fax: +33 1 47 62 50 62
Appendix 1: Results by Business Sector and
Geographic Area
Change on Change on Change on a
a
an actual comparable comparable
I. SALES 2004 2005 structure structure structure
and
(in (in basis basis currency
EUR m) EUR m) basis
by Sector and Division:
Building Distribution 13,653 15,451 +13.2% +3.0% +2.7%
High-Performance 4,732 4,880 +3.1% +2.9% +1.4%
Materials (1)
Ceramics and Plastics & 3,482 3,591 +3.1% +3.9% +2.6%
Abrasives
Reinforcements 1,271 1,306 +2.8% -0.2% -2.2%
Flat Glass 4,429 4,680 +5.7% +2.8% +0.4%
Packaging 3,880 4,008 +3.3% +2.6% +1.9%
Construction Products 6,019 6,694 +11.2% +6.8% +6.0%
(1)
Building Materials 2,620 2,733 +4.3% +6.4% +5.2%
Insulation 2,030 2,244 +10.5% +7.6% +7.1%
Gypsum 263 ns
Pipe 1,388 1,474 +6.2% +6.5% +5.6%
Internal sales and misc. -541 -603 n.s. n.s. n.s.
Group Total 32,172 35,110 +9.1% +3.6% +2.7%
excluding Gypsum :
Construction Products 6,019 6,431 +6.8% +6.8% +6.0%
(1)
Group Total 32,172 34,873 +8.4% +3.6% +2.7%
by geographic area:
France 10,772 11,438 +6.2% +4.7% +4.7%
Other Western European 13,801 15,193 +10.1% -0.2% +0.0%
Countries (2)
North America 5,739 5,956 +3.8% +4.1% +4.0%
Emerging countries and 3,577 4,443 +24.2% +16,2% +6,8%
Asia
Internal sales -1,717 -1,920 n.s. n.s. n.s.
Group Total 32,172 35,110 +9.1% +3.6% +2.7%
Excluding Gypsum :
Other Western European 13,801 14,939 +8.2% -0.2% +0.0%
Countries
Group Total 32,172 34,873 +8.4% +3.6% +2.7%
(1) including intra-sector
eliminations
(2) BPB is included in Other Western
European Countries
Change on
II. OPERATING INCOME 2004 2005 an actual 2004 2005E
(in (in structure (in % of (in % of
EUR m) EUR m) sales) sales)
basis
by Sector and Division:
Building Distribution 762 888 +16.5% 5.6% 5.7%
High-Performance 503 511 +1.6% 10.6% 10.5%
Materials
Ceramics and Plastics & 419 462 +10.3% 12.0% 12.9%
Abrasives
Reinforcements 84 49 -41.7% 6.6% 3.8%
Flat Glass 461 453 -1.7% 10.4% 9.7%
Packaging 459 385 -16.1% 11.8% 9.6%
Construction Products 542 614 +13.3% 9.0% 9.2%
Building Materials 202 223 +10.4% 7.7% 8.2%
Insulation 257 292 +13.6% 12.7% 13.0%
Gypsum -8 ns
Pipe 83 107 +28.9% 6.0% 7.3%
Miscellaneous 16 9 n.s.
Group Total 2,743 2,860 +4.3% 8.5% 8.1%
excluding Gypsum :
Construction Products 542 622 +14.8% 9.0% 9.7%
Group Total 2,743 2,868 +4.6% 8.5% 8.2%
by geographic area:
France 831 889 +7.0% 7,7% 7.8%
Other Western European 961 1,090 +13.4% 7.0% 7.2%
Countries
North America 522 487 -6.7% 9.1% 8.2%
Emerging countries and 429 394 -8.2% 12.0% 8.9%
Asia
Group Total 2,743 2,860 +4.3% 8.5% 8.1%
Excluding Gypsum :
Other Western European 961 1,098 +14.3% 7.0% 7.3%
Countries
Group Total 2,743 2,868 +4.6% 8.5% 8.2%
Change on
III. BUSINESS INCOME 2004 2005 an actual 2004 2005E
(in (in structure (in % of (in % of
EUR m) EUR m) sales) sales)
basis
by Sector and Division:
Building Distribution 759 874 +15.2% 5.6% 5.7%
High-Performance 409 411 +0.5% 8.6% 8.4%
Materials
Ceramics and Plastics & 347 378 +8.9% 10.0% 10.5%
Abrasives
Reinforcements 62 33 -46.8% 4.9% 2.5%
Flat Glass 411 443 +7.8% 9.3% 9.5%
Packaging 422 375 -11.1% 10.9% 9.4%
Construction Products 468 559 +19.4% 7.8% 8.4%
Building Materials 187 247 +32.1% 7.1% 9.0%
Insulation 238 278 +16.8% 11.7% 12.4%
Gypsum -57 ns
Pipe 43 91 +111.6% 3.1% 6.2%
Miscellaneous* -51 -108 n.s.
Group Total 2,418 2,554 +5.6% 7.5% 7.3%
excluding Gypsum :
Construction Products 468 616 +31.6% 7.8% 9.6%
Group Total 2,418 2,611 +8.0% 7.5% 7.5%
by geographic area:
France 838 856 +2.1% 7.8% 7.5%
Other Western European 839 1,012 +20.6% 6.1% 6.7%
Countries
North America 329 302 -7.9% 5.7% 5.1%
Emerging countries and 412 384 -7.0% 11.5% 8.6%
Asia
Group Total 2,418 2,554 +5.6% 7.5% 7.3%
Excluding Gypsum :
Other Western European 839 1,069 +27.4% 6.1% 7.2%
Countries
Group Total 2,418 2,611 +8.0% 7.5% 7.5%
* after asbestos-related charge (before tax) of EUR100m in 2005E and
EUR108m in 2004
Change on
IV. CASH FLOW 2004 2005 an actual 2004 2005E
(in (in structure (in % of (in % of
EUR m) EUR m) sales) sales)
basis
by Sector and Division:
Building Distribution 524 667 +27.3% 3.8% 4.3%
High-Performance 488 446 -8.6% 10.3% 9.1%
Materials
Ceramics and Plastics & 354 342 -3.4% 10.2% 9.5%
Abrasives
Reinforcements 134 104 -22.4% 10.5% 8.0%
Flat Glass 511 528 +3.3% 11.5% 11.3%
Packaging 492 432 -12.2% 12.7% 10.8%
Construction Products 540 559 +3.5% 9.0% 8.4%
Building Materials 203 212 +4.4% 7.7% 7.8%
Insulation 266 287 +7.9% 13.1% 12.8%
Gypsum -31 ns
Pipe 71 91 +28.2% 5.1% 6.2%
Miscellaneous* 84 103 n.s.
Group Total 2,639 2,735 +3.6% 8.2% 7.8%
excluding Gypsum :
Construction Products 540 585 +8.3% 9.0% 9.1%
Group Total 2,639 2,767 +4.9% 8.2% 7.9%
by geographic area:
France 841 903 +7.4% 7.8% 7.9%
Other Western European 893 969 +8,5% 6.5% 6.4%
Countries
North America 446 410 -8.1% 7.8% 6.9%
Emerging countries and 459 453 -1.3% 12.8% 10.2%
Asia
Group Total 2,639 2,735 +3.6% 8.2% 7.8%
excluding Gypsum :
Construction Products 893 1,001 +12.1% 6.5% 6.7%
Group Total 2,639 2,767 +4.9% 8.2% 7.9%
* after asbestos-related charge (after tax) of EUR68m in 2005E and
EUR72m in 2004
Change on
V. CAPITAL EXPENDITURE 2004 2005 an actual 2004 2005E
(in (in structure (in % of (in % of
EUR m) EUR m) sales) sales)
basis
by Sector and Division:
Building Distribution 249 327 +31.3% 1.8% 2.1%
High-Performance 240 271 +12.9% 5.1% 5.6%
Materials
Ceramics and Plastics & 132 187 +41.7% 3.8% 5.2%
Abrasives
Reinforcements 108 84 -22.2% 8.5% 6.4%
Flat Glass 448 485 +8.3% 10.1% 10.4%
Packaging 302 305 +1.0% 7.8% 7.6%
Construction Products 296 355 +19.6% 4.9% 5.3%
Building Materials 101 102 +1.0% 3.9% 3.7%
Insulation 144 145 +0.7% 7.1% 6.5%
Gypsum 52 19.8%
Pipe 51 56 +9.8% 3.7% 3.8%
Miscellaneous* 5 13 n.s.
Group Total 1,540 1,756 +14.0% 4.8% 5.0%
excluding Gypsum :
Construction Products 296 303 +2.0% 4.9% 4.7%
Group Total 1,540 1,705 +10.7% 4.8% 4.9%
by geographic area:
France 363 391 +7.7% 3.4% 3.4%
Other Western European 483 574 +18.8% 3.5% 3.8%
Countries
North America 273 256 -6.2% 4.8% 4.3%
Emerging countries and 421 535 +27.1% 11.8% 12.0%
Asia
Group Total 1,540 1,756 +14.0% 4.8% 5.0%
excluding Gypsum :
Construction Products 483 523 +8.3% 3.5% 3.5%
Group Total 1,540 1,705 +10.7% 4.8% 4.9%
Appendix 2: Balance sheet at 12/31/05 (with BPB)
(in EUR millions)
December December Impact of
31, 2005 31,2004 BPB acquisition
Goodwill 10,541 5,203 4, 882
Other intangible assets, net 2,346 1,804 15
Property, plant and equipment 12,508 9,367 1,864
Investments in associates 137 64 49
Available for sale and other securities 161 92 1
Deferred Tax assets 352 0
Other non-current assets 282 321 17
Non-current assets 26,327 16,851 6,828
Inventories 5,543 4,817 237 (2)
Trade accounts receivable 5,848 4,789 471
Current tax receivable 68 155 7
Other accounts receivable 932 915 63
Cash and cash equivalents 2,080 2,898 239
Current assets 14,471 13,574 1,017
Total assets 40,798 30,425 7,845
Shareholders' equity 12,265 10,673 (55)
Minority interests 328 237 15
Shareholders' equity and 12,593 10,910 (40)
minority interests
Non-voting participating securities
Pensions and other post-retirement benefits 3,029 2,750 358
Deferred tax liability 819 238 61
Non-current provisions for contingencies and 704 548 82
expenses
Long-term debt 11,315 5,629 6,304
Long-term payables on investments 130 0 0
Non-current liabilities 15,997 9,165 6,805
Current provisions for contingencies and expenses 411 353 36
Short-term payables on investments 922 1,338 94
Short-term payables on investments 263 0 243 (3)
Trade accounts payable 4,785 3,954 174
Current tax payable 275 249 108
Other payables and accrued expenses 2,859 2,307 305
Short-term debt 2,693 2,149 120
Current liabilities 12,208 10,350 1,080
Total liabilities and shareholder's equity 40,798 30,425 7,845
Net Debt 12,850 6,218 6,279 (1)
Main impacts related to the acquisition of BPB
(1) of which net debt related to BPB: EUR 6,279 million, including EUR 5,609 million
related to the acquisition of shares and EUR 670 million related to net debt reported in
the books of BPB
(2) All BPB inventories revalued at fair value at November 30 had been sold at December 31,
2005
(3) Amounts payable on investments relate to the cost of shares not cashed out at December
31, 2005
Appendix 3: BPB consolidated income statement (before
and after data restatements by Saint-Gobain)
(in € millions)
December 2005
BPB before BPB after Main
restatements restatements restatements
Sales and 263 237 Elimination of
ancillary internal sales
revenue between BPB and
Saint-Gobain
Group
companies: EUR
(26)m
Operating 24 (8) Impact of
income revaluation of
inventories at
fair value in
the opening
balance sheet
and
cancellation of
margins
generated in
December: EUR
(32)m
Dividends from
non-consolidated companies
Non-operating 0 (36) Restructuring
costs costs
(implementation
of synergies),
of which EUR
(13) million
relating to the
termination of
BPB's Savings
Plan
Profit (loss) 0 (13) Write-down of
on disposals BPB's ERP
and asset
write-downs
Goodwill
amortization
Business 24 (57)
income
Net financial (2) (18) Finance costs
income relating to the
(expense) acquisition
(December 15 to
31): EUR (11)
million;
Exceptional
items: EUR (5)
million
Income taxes (6) 20 Taxes related
to the
foregoing
adjustments
Share in net 1 1
income of
equity
investees
Net income 17 (54)
before
minority
interests
Minority
interests
Net 17 (54)
income
Net income 17 (45)
excluding
capital gains
(losses)
Saint-Gobain's acquisitions in 2005, excluding BPB
61 acquisitions
Financial investment of €1,062 million
for estimated additional sales of €1,733 million
The purpose of this press release is to provide an update on the acquisitions
carried out by the Group in 2005 (not including share buybacks by Compagnie de
Saint-Gobain) and particularly those which were not specifically announced at
the time. Therefore, the acquisition of BPB (Financial investment of €5.9
billion for estimated additional sales of €3.6 billion) is not covered in this
press release.
In 2005, excluding BPB, the Saint-Gobain Group mainly made bolt-on acquisitions
in Building Distribution (Optimera, Sanitas Troesch and 35 bolt-on acquisitions)
and acquisitions in emerging countries.
* * *
Overview of 2005 acquisitions
Acquisitions 2005 Number of Value of Securities Debt Estimated 2005
(en millions d'euros) acquisitions acquired acquired full year sales
Distribution 37 628 64 1,245
High Performance Materials 8 48 13 62
Flat Glass 2 161 (10) 143
Packaging 5 98 22 120
Construction Products 9 127 9 163
TOTAL acquisitions 61 1,062 98 1,733
Of which acquisitions in emerging 22 408 3 482
countries
Debt acquired: € 98 million
* * *
• Building Distribution: Financial investment of €628 million for
additional full year estimated sales of €1,245 million.
228 new sales outlets were added to the Distribution sector network through the
2005 acquisitions in addition to the 140 new sales outlets created through
organic growth.
The two largest acquisitions were: the Norwegian company Optimera (€575 million
sales and 83 sales outlets) and the Swiss distributor of bathrooms
Sanitas-Troesch €306 million sales and 27 sales outlets).
Excluding those 2 operations, the Building Distribution sector made a further 35
bolt-acquisitions: in France (19), in the UK (8), in Scandinavia (3), in the
Netherlands and in the Czech Republic, adding €364m sales and 118 sales outlets.
France - 19 companies acquired (48 sales outlets), representing total full year
sales of €131 million
- 8 specialised distributors, including the DPO group (distributor of air
conditioning products), the FIMAT group (public works specialist), PBA (producer
of ready-to-use concrete), Ardosa (roofing specialist).
- 11 general distributors, including Debourdeau-Lemonnier in the Marne and
Haute-Marne regions, Somail Materiaux in the Herault region and Mat Cagnes in
the Provence, Alpes and Cote d'Azur regions.
United Kingdom - 8 companies acquired (30 sales outlets), representing total
full year sales of €136 million
8 specialised distributors, of which 6 are sanitary, plumbing and heating,
including Ideal Bathrooms in England and Falcon Plumbing and Heating in Essex.
Chadwicks and Blackpool Power Tools, a wood and tool distributor, and CP
Insulations, an insulation distributor, were also acquired.
Other Countries - 8 companies acquired (40 sales outlets), representing total
full year sales of € 97 million
Acquisitions of note are :
Scandinavia - 3 Swedish companies acquired: Luftmijogruppen, Halab and EO-Plat,
specialising in ventilation and heating products (5 sales outlets)
Czech Republic and Slovakia - WAW Keramika, a distributor of tiles and
sanitary-ware throughout the Czech Republic and Slovakia, with 26 sales outlets.
The Netherlands - 2 companies, one of which was De Jager Tolhoek, a general
distributor specialising in wood and panelling.
Brazil - 1 distributor of tiles and sanitary-ware with 5 sales outlets.
• High Performance Materials (HPM) : Financial Investment of €48 million
for estimated additional full year sales of €62 million
There were 8 acquisitions in 2005. Those of note are:
Reinforcements : estimated acquired sales of €33 million
Hornstein Glastextil AG - Austrian woven glass fabric and wallpaper producer for
the residential construction sector.
Hangzhou Vetrotex Plastique - iChinese company producing glass fibre.
Ceramics, Plastics and Abrasives estimated acquired sales of €29 million
Danfeng Abrasives Group - Ceramic grains and powders manufacturer in Northern
China.
Linyi Refractories - Chinese manufacturer of refractories for the glass
industry.
• Flat Glass : Financial investment of €161 million for additional full
year sales of approximately €143 million
Takeover of Hankuk Glass Industries in Korea (announcement of 6 April 2005),
providing an additional €134 million full year sales, (previously
proportionately consolidated and now fully consolidated)
The acquisition of the remaining 60% stake in the Slovakian company Nitrasklo.
• Packaging : Financial investment of €98 million for additional full
year sales of approximately €120 million
Acquisitions of note are:
Eastern Countries - acquisition of Sitall and Kavminsteklo in Russia and Zorya
in the Ukraine. The combined full-year sales of these three bottle producers are
estimated at €93 million.
Microspray Delta - Italian producer of pumps for the perfume and cosmetics
sector (annual sales of €17 million).
• Construction Products (CP): Financial investment of €127 million for
additional full year sales of approximately €163 million
Pipelines - 2 acquisitions, including the cast iron producer Xugang. This
acquisition will secure the supply of our Chinese centrifugation plants.
Insulation - 2 acquisitions, one in China, with the takeover of the glass wool
producer Yi Xing, 170km from Shanghai, and the other in Rumania, with the
purchase of DWB, producer of stone wool, 60km from Bucharest.
Construction Products - 5 acquisitions, of which 4 in emerging countries in the
Mortars business unit: Brazil, Bulgaria, India and a company called Customs in
the Czech Republic.
* * *
Investor Relations Department
Florence TRIOU-TEIXEIRA Tel : +33 (0) 1 47 62 45 19
Alexandre ETUY Tel : +33 (0) 1 47 62 37 15
Fax : + 33 (0) 1 47 62 50 62
This information is provided by RNS
The company news service from the London Stock Exchange