The consolidated financial statements for Holcim (LIBAN) S.A.L for the year ended December 31, 2018 reported a 36.8% year-on-year (y-o-y) decrease in profits to $27.4M, mainly attributed to the slowdown in construction activity and an increasing oversupply of housing units during the instability of 2018. In fact, Holcim tallied $148.6M in net sales, a reduction of 7% from 2017’s net sales. With costs of sales rising, the company’s gross profit decreased by 19.5% to $65.4M.
Total assets remained relatively stable with a slight decrease of 0.35%, bringing it to $263.4M. In fact, Current assets decreased by 6.6% to $103.6M, partly attributed to a significant increase in inventories from $30.5M in 2017 to $52.1M in 2018. The inventory increase covered the 70.4% annual fall recorded in HOLCIM’s Cash and cash equivalents to stand at $3.8M over the same period.
Additionally, total liabilities increased by 30.8% to $115.4M, as Bank overdrafts reached $46.9M in 2018, up from 2017’s $17.6M. This is mainly due to the high dividend payments in 2018 and an increase in working capital due to higher inventory levels which led Holcim to resort to bank loans to finance its operations.
Furthermore, total equity decreased by 16% to $147.9M. This decrease came on the back of an additional 37.8% decrease in legal reserves to $21.6M, and accumulating $28.7M in retained earnings, a 33.3% decrease from 2017.
Source: BSE; HOLCIM.