annual results 2003 and outlook 2004 holcim strength performance passion

1
Annual Results 2003 and Outlook 2004
Strength. Performance. Passion.
1
Annual Results 2003
Holcim Group in 2003
 Difficult economic environment – no improvement until
second half of the year.
 Weak dollar pressures financial results.
Holcim nevertheless reports a strong annual result:
 Higher sales volumes in all three core segments.
 Operating profit rises 1.2 percent to CHF 1,925 million and
Group net income jumps 35.6 percent to CHF 686 million.
 Focus on growth markets has again proved effective.
 Measures to improve performance are kicking in.
 Standard share increases transparency and stock liquidity.
 Proposed increase in dividend.
2
2
Annual Results 2003
Operating strengths
 Creation of cross-border management structures and
regional IT service centers improving efficiency.
 Lower administration and selling expenses.
 Energy price hikes off-set by greater use of alternative
fuels and raw materials.
 Innovative products enable us to produce more cement
with less clinker, minimizing environmental impacts.
 Selective pricing adjustments in individual markets.
3
Annual Results 2003

Progress in the US
 New management at Holcim US delivering on expectations.
 At 20 percent, the 18 percent target operating EBITDA
margin announced mid-2003 was exceeded.
 Improved performance at the Portland plant.
 Holly Hill plant commissioning very successful.
 In seven years, more than 8 million tonnes of state-of-the-
art cement capacity has been installed.
 Rising freight rates will increase price of imported cement.
 Holcim US will benefit well from growing cement demand.
3
4
Annual Results 2003
Balance-sheet clean-up
Holcim has successfully continued to concentrate on its core
business and further streamlined its portfolio of interests:
 Eternit AG in Switzerland was divested.
 Further reduction in shareholding in Cimpor of Portugal.
 Disposal of interest in Dyckerhoff (Germany).
 Successful financial restructuring at Minetti in Argentina.
 Additional disposal of non-strategic assets.
5
Annual Results 2003
Value-adding transactions
 Acquisition of Cementos Hispania strengthens Holcim
presence in key Madrid market.
 Successful conclusion of contract leads to acquisition of
Rohrbach Zement.
 Acquisition of majority holding in Alpha Cement in Russia
with plants near Moscow and on the Volga.

 Purchase of two quarries in Ontario secures strategic raw
materials supply and strengthens market positioning.
 Merger of the two Group companies in the Philippines.
 Cement Australia becomes market leader in Australia.
 Expansion of ready-mix business, especially in Eastern
and Southeast Europe, as well as Brazil and Chile.
4
6
Annual Results 2003
Europe
 Main drivers in the sector are
infrastructure projects and
residential construction.
 Markets in Spain and Italy
continue to demonstrate solidity.
 In several West European
markets, order volumes were
stable or slightly lower.
 Crisis in the German building
industry is not yet over.
 Cement demand rising in Eastern
and Southeast Europe.
7
Annual Results 2003
Operations in Europe
Cement capacity Group (Europe): 44.0 million t; further 2.3 million t with partners.
Group:
Cement plant
Grinding plant
Terminal

Grinding plant
under construction
Participation:
Cement plant
5
8
Annual Results 2003
Facts on Europe
 New production capacity and new products strengthen
cost leadership.
 Higher sales volumes due to extended presence and
solid market positions.
 Stiffer competitive situation and price war in Germany
pressure operating results.
 Declining operating profit in Europe.
 Focus on core business through disposal of Eternit AG,
Niederurnen (Switzerland).
 Divestiture of interest in Dyckerhoff AG and substantial
scaling back of shareholding in Cimpor.
9
Annual Results 2003
North America
 Sluggish recovery in US construc-
tion sector and weather-related
sales setback in first-half 2003.
 Gradual rise in US and Canadian
demand in second-half 2003.
 Biggest drivers were residential
and major infrastructure projects.
 Cement consumption recovering;

slight decline in share of imports.
6
10
Annual Results 2003
Operations in North America
Cement plant
Grinding plant
Terminal
Cement plant
project
Cement capacity Group (North America): 21.3 million t.
11
Annual Results 2003
Facts on North America
 Approval process for building of two new cement
plants still underway.
 Above-average increase in cement deliveries at
Holcim US due to new Holly Hill plant and rise in
output at Portland.
 Healthy order situation in Canada assists sales at
St. Lawrence Cement; slight decline in US Northeast.
 Rising production efficiency and easing of price
pressures lead to higher operating profit in local
currency for Holcim US.
 Massive dollar depreciation lowers results of North
America in Swiss franc terms.
7
12
Annual Results 2003
Latin America

 Construction industry held up well
across most countries.
 Cement consumption showed solid
increase in Mexico, Central Ameri-
ca and the Caribbean, as well as in
Colombia, Argentina and Chile.
 Main impetus came from private-
sector housing construction.
 Venezuelan building industry badly
affected by politically unstable
situation.
 Largest market, Brazil, suffered
lack of public building projects.
13
Annual Results 2003
Operations in Latin America
Cement capacity Group (Latin America): 31.2 million t; further 9.5 million t with partners.
Group:
Cement plant
Grinding plant
Terminal
Participation:
Cement plant
Grinding plant
Terminal
8
14
Annual Results 2003
Facts on Latin America
 Rise in consolidated cement deliveries.

 Higher sales volume and productivity improve results of
Holcim Apasco in Mexico.
 Impressive business performance by our Group com-
panies in the Caribbean and Chile.
 Performance in Costa Rica, Colombia and Ecuador hit
by changes in external conditions.
 Brazil able to increase results despite drop in volumes.
 Turnaround for Minetti in Argentina due to rising demand
for building materials and strong market presence.
 In local currency, Latin America improves on previous
year.
15
Annual Results 2003
Africa Middle East
 South Africa and Morocco
exhibit further robust growth.
 In Lebanon and Egypt, the
construction sector fared well.
 Political instability influenced
business activity on the West
African coast.
 Pleasing increase in cement
consumption overall.
9
16
Annual Results 2003
Operations in Africa Middle East
Group:
Cement plant
Grinding plant

Terminal
Participation:
Cement plant
Grinding plant
Terminal
Cement capacity Group (Africa Middle East): 13.3 million t; further 5.1 million t with partners.
17
Annual Results 2003
Facts on Africa Middle East
 Higher volumes for all Group companies except West
Africa group.
 Significantly enhanced financial results for Group
companies in Morocco and South Africa.
 Holcim Lebanon and Egyptian Cement suffered intense
price competition; profit contributions nevertheless
remained substantial.
 Investment aimed at boosting efficiency in production and
distribution is paying off.
 Sharp rise in operating profit for this Group region.
10
18
Annual Results 2003
Asia Pacific
 Impressive growth rates in ASEAN
countries.
 Overall backdrop remains healthy
in the Pacific region.
 Major infrastructure projects and
residential construction providing
boost for building sector activity.

 Cement consumption grew in
nearly all markets.
 Shortage of public-sector orders
in the Philippines.
19
Annual Results 2003
Operations in Asia Pacific
Cement capacity Group (Asia Pacific): 35.5 million t; further 18.4 million t with partners.
Group:
Cement plant
Grinding plant
Terminal
Grinding plant
under construction
Participation:
Cement plant
Grinding plant
Terminal
11
20
Annual Results 2003
Facts on Asia Pacific
 Domestic demand for cement is growing in Asia; export
business losing some of its attractiveness.
 Strengthening of market position in the Philippines after
the merger of our two local Group companies.
 Joint venture in Australia proving itself and fully exploiting
available production capacity.
 Impressive increase in sales in Malaysia, Vietnam,
Thailand, Indonesia, Australia and New Zealand.

 Turnaround at PT Semen Cibinong in Indonesia.
 Group region Asia Pacific displayed the biggest increase
in operating profit.
21
Annual Results 2003
Sustainable development
 We are committed to dealing sensitively with natural
resources and the environment, and are addressing our
wider social responsibilities.
 We engage in numerous relationships with various
stakeholder groups.
 We are an active participant in the World Business
Council for Sustainable Development.
 We have signed the UN Global Compact.
 Positive ranking in the Dow Jones Sustainability Index
(DJSI).
 Second Corporate Sustainable Development Report
(CSDR) to be published in June.
12
22
Annual Results 2003
Key financial figures
in CHF in loc. curr.
Net sales 13'644 13'010 12'600 -3.2% 2.4%
Operating EBITDA 3'335 3'341 3'311 -0.9% 6.8%
Operating profit 1'945 1'903 1'925 1.2% 9.7%
Group net income
after minorit
y
interests

812 506 686 35.6% 45.7%
Cash flow from
operating activities 2'402 2'388 2'619 9.7% 17.4%
EPS in CHF 4.24 2.59 3.51 35.5% 45.9%
Dividend in CHF
1.00 1.00
1.15
1)
15.0%
+/-
Million CHF 2001 2002 2003
1) Proposal of the Board of Directors
23
Annual Results 2003
Major changes in the scope of consolidation
Effective as at
Cement
capacity
+
Novi Popovac, Serbia April 15, 2002 1.4 million t
+
Union Cement, Philippines, from
proportionate to full consolidation October 1, 2002 + 2.4 million t
–
Baubedarf, Switzerland October 1, 2002 –
+
Cementos Hispania, Spain January 1, 2003 0.8 million t
+
Proportionate consolidation of Cement
Australia (integration of Queensland Cement) June 1, 2003 –

–
Eternit AG, Switzerland November 10, 2003 –
+
Alpha Cement, Russia December 31, 2003 4.3 million t
+/–
Various smaller companies
13
24
Annual Results 2003
Exchange rates
1) weighted by net sales full year 2002
Statement of income
average exchange rates in CHF 2001 2002 2003 +/-
1 EUR 1.51 1.47 1.52 3.4%
1 USD 1.69 1.55 1.34 -13.5%
1 African Basket (EGP, ZAR, MAD)
1)
1.24 1.00 1.04 4.0%
1 Asian Basket (AUD, NZD, THB, PHP)
1)
1.04 1.00 0.95 -5.0%
Balance sheet
year-end exchange rates in CHF 2001 2002 2003 +/-
1 EUR 1.48 1.45 1.56 7.6%
1 USD 1.68 1.39 1.24 -10.8%
1 African Basket (EGP, ZAR, MAD)
1)
1.00 1.00 1.02 2.0%
1 Asian Basket (AUD, NZD, THB, PHP)
1)

1.13 1.00 1.03 3.0%
25
Annual Results 2003
Currency exposure and sensitivity
Other
25%
EUR
32%
USD
38%
CHF
5%
Sales Operating Profit
USD sensitivity
Million CHF
USD/CHF
at 1.34
USD/CHF
at 1.33
+/- in
Mio. CHF
Net sales 12'600 12'565 -35
Operating profit 1'925 1'918 -7
Group net income after minority interests 686 684 -2
Cash flow from operating activities 2'619 2'609 -10
Other
26%
EUR
22%
USD

48%
CHF
4%
14
26
Annual Results 2003
Cement and clinker sales volumes
Million t
25.3 26.5
∆
02/03 Volume Change in
structure
Total
Europe 1.6% 3.1% 4.7%
North America 4.2% 0.0% 4.2%
Latin America 1.5% 1.2% 2.7%
Africa Middle East 8.3% 1.1% 9.4%
Asia Pacific -4.5% 5.8% 1.3%
Total 1.5% 2.7% 4.2%
2002
2003
16.5
17.2
18.8
19.3
11.7 12.8
22.9
23.2
27
Annual Results 2003

89.5
92.1
95.9
27.0
25.3
25.5
2001 2002 2003
Sales volumes aggregates and ready-mix concrete
Aggregates sales in million t
Ready-mix concrete sales in million m
3
+ 4.1%
+ 6.7%
+ 2.9%
-0.8%
+ 3.3%
+ 2.4%
15
28
Annual Results 2003
12'600
13'010
13'644
2001 2002 2003
Net sales
Volume/price 166 1.2% -108 -0.8% 270 2.1%
Change in structure 359 2.6% 398 2.9% 47 0.3%
Forex movements -412 -3.0% -924 -6.7% -727 -5.6%
Total change 113
0.8%

-634 -4.6% -410 -3.2%
Million CHF
29
Annual Results 2003
Net sales by region
Million CHF
4320 4441
∆
02/03 Volume/
price
Change in
structure
Currency Total
Europe 1.4% -1.4% 2.8% 2.8%
North America -0.1% 0.2% -9.1% -9.0%
Latin America 0.3% 1.0% -13.8% -12.5%
Africa Middle East 11.5% 2.1% -0.9% 12.7%
Asia Pacific 9.9% 2.9% -10.1% 2.7%
Total 2.1% 0.3% -5.6% -3.2%
2002
2003
2755
2507
3248
2842
1136 1280
1714
1760
16
30

Annual Results 2003
North
America
19%
Europe
35%
Asia
Pacific
14%
Africa
Middle East
10%
Latin
America
22%
Net sales by region
Sales 2003
31
Annual Results 2003
3'311
3'3413'335
26.3%
25.7%
24.4%
2001 2002 2003
Operating EBITDA
Million CHF
Margin
Volume/price/cost -41 -1.2% 184 5.5% 177 5.3%
Change in structure 108 3.2% 73 2.2% 50 1.5%

Forex movements -97 -2.9% -251 -7.5% -257 -7.7%
Total change -30
-0.9%
6 0.2% -30 -0.9%
17
32
Annual Results 2003
3'383
3'399
3'574
26.8%
26.1%26.2%
2001 2002 2003
EBITDA
Million CHF
Margin
-4.9%
-0.5%
-0.6%
33
Annual Results 2003
1'945
1'903
1'925
14.3%
14.6%
15.3%
2001 2002 2003
Operating profit
Margin

Volume/price/cost -64 -3.2% 133 6.8% 151 8.0%
Change in structure 65 3.2% -20 -1.0% 33 1.7%
Forex movements -57 -2.8% -155 -8.0% -162 -8.5%
Total change -56 -2.8% -42 -2.2% 22 1.2%
Million CHF
18
34
Annual Results 2003
Operating profit by region
Million CHF
785
766
∆
02/03 Volume/
price/cost
Change in
structure
Currency Total
Europe -10.9% 3.8% 2.7% -4.4%
North America 0.3% 1.0% -9.7% -8.4%
Latin America 12.7% 0.7% -15.8% -2.4%
Africa Middle East 20.7% 2.0% -4.1% 18.6%
Asia Pacific 28.8% 1.3% -8.6% 21.5%
Total 8.0% 1.7% -8.5% 1.2%
504
482
242
287
163
198

298
273
2002
2003
35
Annual Results 2003
Other income and financial expenses
Other Income, million CHF 2002 2003
Dividends earned 78 80
Financial income 6 -8
Other ordinary income 94 0
Provision related to antitrust investigation Germany -120 0
Depreciation and amortization of non-operating assets -107 -60
Total -49 12
Financial Expenses Net, million CHF 2002 2003
Financial expenses -677 -574
Interest earned on cash and marketable securities 69 64
Foreign exchange gain net 17 0
Financial expenses capitalized 27 15
Total -564 -495
19
36
Annual Results 2003
Group net income
1'031
797
932
812
506
686

2001 2002 2003
Before minority interests in million CHF
After minority interests in million CHF
-0.4%
-8.4%
-22.7%
-37.7%
+16.9%
+35.6%
37
Annual Results 2003
Cash flow from operating activities
2'402
2'388
2'619
17.6%
18.4%
20.8%
2001 2002 2003
Million CHF
Margin
-6.1%
-0.6%
+9.7%
20
38
Annual Results 2003
Cash flow statement
Million CHF 2001 2002 2003 +/-
Cash flow from operating activities 2'402 2'388 2'619

9.7%
Net investments to maintain productive
capacity and to secure competitiveness -855 -843 -802 -4.9%
Free cash flow 1'547 1'545 1'817
17.6%
Expansion investments -875 -409 -490 19.8%
Financial investments net -1'949 -245 -442 80.4%
Dividends paid -323 -358 -368 2.8%
Financing (requirement) surplus -1'600 533 517
-3.0%
39
Annual Results 2003
Financing
Million CHF 2001 2002 2003 +/-
Financing (requirement) surplus -1'600 533 517
-3.0%
Capital paid-in (repaid) 1'426 -10 26
Movements of treasury shares net -372 -1 4
In(De)crease in financing liabilities 490 334 -676
Equity component of convertible bonds – 58 –
Decrease in marketable securities 660 16 30
In(De)crease in cash and
cash equivalents 604 930 -99
-110.6%
21
40
Annual Results 2003
Financial position
9'499
9'435

10'383
8'299
8'857
9'768
94.1%
93.9%
87.4%
31.12.2001 31.12.2002 31.12.2003
Equity in million CHF Net financial debt in million CHF Gearing
41
Annual Results 2003
2001 2002 2003 Target
Operating EBITDA margin (%) 24.4 25.7 26.3 30
ROE (%) 11.0 7.1 10.2 13-15
RONOA (%) 12.3 11.9 12.2 15-18
Gearing (%) 94.1 93.9 87.4 80-100
Funds from operations/
Net financial debt (%)
25.1 26.4 28.6 > 25
EBITDA net interest coverage 5.5 5.9 6.8 > 5
EBIT net interest coverage 3.3 3.2 3.9 > 3
Standard & Poor's Rating BBB+
Financial indicators
22
42
Annual Results 2003
Outlook 2004
 Only a modestly brighter picture for construction activity
in many Group markets.
 In key markets, Holcim will achieve increased sales of

cement, aggregates and concrete.
 Greater value added due to improved efficiency.
 Solid balance sheet allows selective investment in new
markets or Group companies.
 Further increase in operating results anticipated.