Revenues at the cement producer reached USD 196 million in 2011, growing by 5.7% y-o-y, led by rising prices and slight growth in local demand. However, Holcim’s gross income declined by 4.5% to $65.9 million in 2011, as a rise in energy prices during the second half of the year negatively impacted profitability. Similarly, net income also contracted by nearly 16% y-o-y falling to $28.3 million. Holcim is planning to distribute $26.57 million, or $1.36 per share, in dividends on 2011 earnings for a gross dividend yield of 8.0% on the year-end 2011 closing price of $16.98 per share. We maintain a HOLD recommendation on the stock but lower our target price to $15.24 from $16.16 previously, as the political instability in the region continues to impact appetite for the real estate market.
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