Latin America resists headwinds while Mexico recovers

Mixed economic climate with considerable uncertainties

Latin America faced with challenging development in 2014 as economic activity remained in low gear. Lower commodity prices and tightening financial conditions, as well as supply bottlenecks put pressure on growth in a number of countries.

Over the course of 2014 growth in Mexico rebounded, supported by an increase in exports, higher public spending on infrastructure, and an improved manufacturing sector. The Central American countries reported moderate growth. Colombia’s economy expanded on solid levels thanks to investment in construction projects, while Ecuador could not maintain the high growth rates of the previous year. Brazil’s economy largely moved sideways in 2014 as investment was low and interest rates and inflation high. Growth in Chile was low due to uncertainty of the impact of government reforms, and Argentina’s economy suffered severely from the debt crisis.

Mostly declines and moderate growth in construction markets

The construction market in Mexico recovered in the second half of 2014, supported by the implementation of the National Infrastructure Investment Plan announced in June, but challenges remained in the housing market. In Central America construction activity in El Salvador declined due to less infrastructure spending, while in Costa Rica the sector has been basically flat, and in Nicaragua considerable growth was recorded. Colombia benefited from several infrastructure expansion and housing projects by the government, leading to increased demand for building materials. Ecuador’s construction industry however was less dynamic in 2014. The construction sector in Brazil grew only slightly due to lower private and public investment and delays in infrastructure projects, reflecting the overall challenging economic climate. Chile’s and Argentina’s construction sectors shrank in 2014, however in Argentina the declines were not as pronounced as in other sectors.

Consolidated key figures Latin America

 

2014

2013

±%

±% LFL*

*

Like-for-like, i.e. factoring out changes in the scope of consolidation and currency translation effects.

**

The percentage change like-for-like adjusted for internal trading volumes eliminated in "Corporate/Eliminations" amounts to -1.0.

Production capacity cement in million t

35.3

35.3

+0.1

 

Cement and grinding plants

27

27

 

 

Aggregates plants

12

18

 

 

Ready-mix concrete plants

109

119

 

 

Sales of cement in million t

24.6

25.0

–1.5

–1.5**

Sales of aggregates in million t

7.5

10.2

–26.4

–26.4

Sales of ready-mix concrete in million m3

6.4

8.0

–20.0

–20.0

Net sales in million CHF

3,012

3,349

–10.0

+0.6

Operating EBITDA in million CHF

861

938

–8.2

–0.8

Operating EBITDA margin in %

28.6

28.0

 

 

Operating profit in million CHF

663

722

–8.2

–1.1

Operating profit margin in %

22.0

21.6

 

 

Personnel

10,733

11,181

–4.0

–3.9