Download - Holcim in South Asia/ASEAN - Holcim Group
Strength. Performance. Passion.
© 2012 Holcim Ltd
Holcim in South Asia / ASEAN Paul Hugentobler, Member of the Executive Committee
© 2012 Holcim Ltd
© 2012 Holcim Ltd
Agenda
Regional Overview and Trends 2
Business Subregion India 12
Business Subregion Lower Mekong Subregion 19
Business Subregion Indonesia 24
Regional Contribution to the Holcim Leadership Journey 31
Concluding Remarks 45
Investor and Analyst Day 2012 2
© 2012 Holcim Ltd
Holcim footprint in South Asia / ASEAN*
• Cement sales 42 mt
• FTEs 34’014
• Net Sales CHF 3.4 bn
• EBITDA CHF 0.9 bn
• Cash Flow CHF 0.5 bn
Key Figures H1 2012
Source: Corporate Controlling * Association of Southeast Asian Nations
Investor and Analyst Day 2012 3
Integrated Plant
Grinding Station
Under construction
Terminal
© 2012 Holcim Ltd
A relatively young history within Holcim Group
0
10
20
30
40
50
60
70
1912 1920 1930 1940 1950 1960 1970 1980 1990 2010
Qatar Dubai India United Kingdom Norway Ireland Serbia Croatia China New Caledonia Tanzania Sri Lanka Bulgaria Romania Honduras Poland Kosovo Madagascar Mauritius Guinea Angola Iran Malaysia Thailand El Salvador Dom. Republic Indonesia Nicaragua Guatemala French Guyana Azerbaijan Austria Ivory Coast Nigeria Namibia La Réunion Fiji Haiti Carib. Islands Panama Bangladesh Yemen Singapore Vietnam Switzerland
France Belgium
Netherlands Egypt Lebanon
Germany South Africa
Canada Brazil USA
Mexico Costa Rica Italy Colombia
New Zealand Philippines Ecuador Chile Australia Cyprus
Venezuela Spain Hungary Czech Republic Greece Slovak Republic Morocco Peru Argentina Russia
Eu
rop
e
Afr
ica
Mid
dle
Eas
t
Asia
Pacif
ic
No
rth
Am
eri
ca
Lati
n A
meri
ca
Number
of countries
Investor and Analyst Day 2012 4
© 2012 Holcim Ltd
Solid platform: 53% Holcim CEM volume, 27% of Net Sales,
33% of EBITDA in 2011
OpCo
Sales 2011 (t cem /m3 RMX)
EBITDA 2011 (CHF) at actual
2011 constant FX rates
Holcim Lanka
1.5 mt
CHF 21 m
Holcim Bangladesh
0.9 mt
CHF 8 m
Siam City Cement:
11.8 mt / 2.7 mm3
CHF 168 m
Ambuja Cement
21.5 mt
CHF 382 m
Holcim Vietnam
3.7 mt / 0.8 mm3
CHF 47 m
Holcim Malaysia
0.7 mt / 0.3 mm3
CHF 14 m
Holcim Philippines
5.3 mt / 0.1 mm3
CHF 99 m
Holcim Singapore
1.3 mm3
CHF 13 m
Holcim Indonesia
8.0 mt / 1.5 mm3
CHF 235 m
ACC
24.0 mt / 1.8 mm3
CHF 390 m
Source: Corporate Controlling Quoted companies
Investor and Analyst Day 2012 5
Integrated Plant
Grinding Station
Under construction
Terminal
© 2012 Holcim Ltd
Regional network of manufacturing sites and markets
Holcim
United Arab
Emirates
Middle East,
Holcim Madagascar
Holcim
Reunion
Australia
Australia
Investor and Analyst Day 2012 6
Integrated Plant
Grinding Station
Under construction
Terminal
© 2012 Holcim Ltd
Our regional management approach…
• Robust business growth strategy for every country;
coordinated across region to optimize capacity utilization and
flows of clinker and cement
• Lean Regional Management structure and strong local
management teams
• De-centralized but standardized philosophy deploys making
and accountability to the local management teams
• Focus on functional excellence through faster
multiplication of best practices across the region
• Focus on people development and capability building
Investor and Analyst Day 2012 7
© 2012 Holcim Ltd
…is based on a blend of skills and emotional engagement
Principles
• Ensure leadership development at both the front-line and management level
• Deploy large efforts to internationalize talent across the region and the Group
• Rely on formal levers to achieve alignment (within OpCo’s and across the region),
while focusing on informal levers to mobilize the human capital
• Identify the “pride builders” within the organization and leverage their ability to
energize people
Alig
nm
en
t Mo
tivatio
n
Vision
Values
Strategy
Integrating Mechanisms
Purpose
Pride
Commit-
ment
Top
Leaders
Team
Members
Rational
Compliance
Emotional
Commitment
Pride Bell Curve
Energize
Pride Score Indicator (PSI)
Pride builders
Achieving Alignment and Motivation
Investor and Analyst Day 2012 8
© 2012 Holcim Ltd
Best practice multiplication to accelerate delivery of bottom
line impact
OpCo Leadership OpCo Leadership OpCo Leadership
RMX, LIP (Large and Infrastructure Projects)
Finance
OH&S, Geocycle, Procurement, Manufacturing
People Exchanges
Customer Excellence (CRM, M&S)
Cross-
Regional
Bench-
marking and
Best
Practices
Sharing
Contribution to Holcim Leadership Journey
Investor and Analyst Day 2012 9
© 2012 Holcim Ltd
In the past ten years Holcim Group rapidly increased its
exposure to South Asia and ASEAN…
Indexed development of Holcim Group vs. Holcim South Asia / ASEAN (excl. the
Philippines), (2002=100)
Cement Capacity Cement Volumes Sold
Net Sales Operating EBITDA
2002 2004 2006 2008 2010 2012
1′000
800
600
400
200
0
Holcim South Asia / ASEAN Holcim Group
2002 2004 2006 2008 2010 2012
1′000
800
600
400
200
0
2002 2004 2006 2008 2010 2012
1′000
800
600
400
200
0
2002 2004 2006 2008 2010 2012
1′000
800
600
400
200
0
India acquisitions India acquisitions
India acquisitions India acquisitions
Source: Corporate Controlling
Investor and Analyst Day 2012 10
© 2012 Holcim Ltd
…paying back in increasing Operating EBITDA contribution
359
311301
285
243249
350
311297298
235
257
234
182
291
237248
291
225
264
234229
7%*
2012 2011 2010 2009 2008 2007
Q4 Q3 Q2 Q1
Development of operating EBITDA in South Asia / ASEAN (excl. the Philippines), (CHF m,
at constant exchange rates per 30.6.2012)
* CAGR of H1 results
Source: Corporate Controlling
Investor and Analyst Day 2012 11
© 2012 Holcim Ltd
Agenda
Regional Overview and Trends 2
Business Subregion India 12
Business Subregion Lower Mekong Subregion 19
Business Subregion Indonesia 24
Regional Contribution to Holcim Leadership Journey 31
Concluding Remarks 45
Investor and Analyst Day 2012 12
© 2012 Holcim Ltd
India’s short-term macro environment is challenging…
Population
GDP
Foreign
Exchange
• Subdued real GDP growth at 6 - 6.5% in 2012 as a result of acute
policy paralysis and odds of the World / Euro crisis
• Upside potential to 7% with elections approaching in 2014 and a
push to implement domestic reform
• Continuous population growth of around 2% per annum on a
current base of more than 1.2 billion raises sustainability issues
• Millions of young people aspire to be integrated into the workforce
• Rupee depreciation erodes current factor market benefits
Inflation
• Inflation remains at a high level of around 7%
• Government’s 5% inflation target un-realistic unless major reforms
ease supply pressure and infrastructure development gets pushed
Investor and Analyst Day 2012 13
© 2012 Holcim Ltd
…but long-term growth fundamentals are robust
7.5%
2010-20E
7-8%
2000-10
Sustainable GDP growth
(real GDP CAGR)
1/5 more people in India
(million people)
100 m more in cities
(million urban population)
Trade volume quadruples
(USD m)
HH Consumption doubles
(USD bn)
Infra spending doubles
(USD bn; 5 year plan)
~1,400
~18%
2020E 2010
1,185 365~475
~110
2020E 2010
583
~2,500
~4.3x
2020E 2010
534
~1,000
~2x
2020E 2010
514
800-1,000
1.5-2x
12th Plan 11th Plan
Source: McK Consumer India; Urbanisation, EIU, Planning Commission of India, 2012
Investor and Analyst Day 2012 14
© 2012 Holcim Ltd
Cement demand to grow at 8-9% p.a. over the next years
• Overall cement demand expected to reach around 341 mt in 2016
• More conservative growth assumptions in 2012/13 due to overall macro situation;
upcoming election cycle push expected in 2014
Cement demand of India 2006-2016E (mt)
341312
286263
242224212
193174160146
2016E 2015E 2014E 2013E 2012E 2011 2010 2009 2008 2007 2006
+8.9%
+8.7%
10.1 9.3 9.0 10.8 5.6 7.8 8.9 9.2
x Y-o-y growth
9.1 8.6
Source: ACC / ACL D/S workshops, CRISIL 2012, McK 2011
Investor and Analyst Day 2012 15
© 2012 Holcim Ltd
Supply surplus situation remains, however, demand / supply
ratio is improving
• Slow down in available supply growth as most capacities from the 2007 up-cycle are
commissioned by now
• New projects get delayed due to lack of financing availability, difficult land acquisition
and lengthy processes to obtain permits
• Roughly 70% excess supply is located in the South
All India demand / supply 2011-2016E (mt)
341312
286263242224
400380352
331310
290
2016E
2015E
2014E
2013E
2012E
2011
Demand / available
supply 77% 78% 79% 81%
Available supply
Demand
82% 85%
Source: ACC / ACL D/S workshops, CRISIL 2012, McK 2011
Investor and Analyst Day 2012 16
© 2012 Holcim Ltd
Holcim is competitively positioned in core growth markets
Investor and Analyst Day 2012 17
Integrated Plant
Grinding Station
Terminal
Existing ACL
Existing ACC
Under construction
• Holcim presence through ACC Ltd and
Ambuja Cements Ltd
► 11 plants and 13 grinding units with a
total capacity of ~58 mio t cement
► 50+ Ready-mix concrete plants
► Terminals along the West cost to
serve core markets
► Projects in implementation stage
include Jamul, Sindri, Kharagphur,
Mangalore, Sankrail; others in
planning
• Total sales 2011 of ~45 mt
• CHF ~3.5 bn net sales, CHF ~773 m
EBITDA (2011)
• ~23‘400 FTE (2011)
© 2012 Holcim Ltd
• “Zero Harm to People” to become a license to lead
• Capturing growth potential and sustaining our competitive position • Capacity expansion of approx. 15 mtpa over the next 5 years
• Attractive acquisition target where available for sale
• Identification of new raw material sources to ensure tomorrow’s growth (e.g.
limestone, clay, slag, fly-ash)
• Most agile and efficient supply chain of the industry to reduce costs-to-
serve • Energy, e.g. fuels, AFR, clinker factor, operational efficiencies
• Logistics (in- and outbound)
• Customer-centricity and front end-innovation across all market segments
• People and Leaders • Attracting and retaining talent remains an ongoing challenge
• Training and development of people and leaders to ensure skills at all levels
• Top quartile financial performance in the Indian cement industry
Strategic priorities for India
Investor and Analyst Day 2012 18
© 2012 Holcim Ltd
Agenda
Regional Overview and Trends 2
Business Subregion India 12
Business Subregion Lower Mekong Subregion 19
Business Subregion Indonesia 24
Regional Contribution to Holcim Leadership Journey 31
Concluding Remarks 45
Investor and Analyst Day 2012 19
© 2012 Holcim Ltd
*
Five heterogeneous countries constitute the LMS*…
Thailand
Vietnam
Cambodia
Myanmar
Laos
Naypyidaw
Bangkok
Vientiane
Hanoi
Ho Chi Minh City Phnom Penh
6.3
48.3
14.3
87.8
69.5
LA MM KH VN TH
Population per Country, 2011 (million)
GDP, 2011 (USD bn)
Source: World Bank, IMF
7.951.9
12.9
122.7
345.6
LA MM KH VN TH
Yangon
* Lower Mekong Subregion
Investor and Analyst Day 2012 20
© 2012 Holcim Ltd
…however, united through economic corridor approach
• Introduction of Greater Mekong
Subregion Program by ADB (Asian
Development Bank) in 1992 to
enhance economic cooperation /
development
• Economic corridor approach since
1998 to leverage potential of specific
geographic areas
• Corridors based on cross-border
physical transport linkages opening up
various development opportunities
• Physical links well progressed as of
today, economic integration has yet to
be achieved
Investor and Analyst Day 2012 21
© 2012 Holcim Ltd
Cement demand expected at more than 120 mtpa by 2020
98
872
22
2111
11111
+5.1%
+4.8%
20E
+4.6% 123
37
71
4
3
19E
118
35
68
4
3
18E
113
34
64
4
2
17E
108
33
61
3
2
16E
103
32
58
3 7
15E
98
32
55
3 6
14E
93
31
52
3 6
13E
89
30
49
3 5
12E
84
29
46
3 5
11
81
28
44
3 5
10
79
27
43
3 5
09
72
25
40
2 4
08
68
26
36
3 3
07
68
29
34
2 3
06
65
30
30
2 2
05
61
30
27
2 2
Thailand Vietnam Cambodia Myanmar Laos
Cement demand of Lower Mekong Subregion 2005-2020E (in mtpa)
• Infrastructure demand as main driver for cement demand growth in next decade
(hydropower dams, bridges and tunnels for railway projects, deep sea ports etc.)
• Urbanization and development of 2nd and 3rd tier cities will be main drivers
Source: Holcim estimates
Investor and Analyst Day 2012 22
© 2012 Holcim Ltd
Competitive positions in South Vietnam and Thailand
SCCC / Holcim Vietnam’s positions in the Lower Mekong Subregion
SCCC / HVL Integrated Plant
SCCC / HVL Grinding Station
SCCC / HVL Terminal
Cost Competitive Position (Core)
Border Sales
Holcim Vietnam
We still need to network
these regions with an
expanded asset
footprint
Investor and Analyst Day 2012 23
© 2012 Holcim Ltd
Agenda
Regional Overview and Trends 2
Business Subregion India 12
Business Subregion Lower Mekong Subregion 19
Business Subregion Indonesia 24
Regional Contribution to Holcim Leadership Journey 31
Concluding Remarks 45
Investor and Analyst Day 2012 24
© 2012 Holcim Ltd
Indonesia is growing faster and gaining confidence
Middle class population is growing fast
GDP growth is promising Infrastructure investment priorities are set
205
2
Rail
37
Airport
4
Energy
78
Port
13
Road
39
Total Others
4
ICT
28
Utility
(USD bn)
Indonesia’s investment ratings upgraded
• Moody’s Baa3 (investment grade)
• Fitch’s BBB- (investment grade)
• Standard & Poor’s BB+ (one notch
to investment grade)
600
400
200
0
5.9%
6.3%
5.8%
5.5%
2020 2011 2002
Real GDP per capita
2020
269
171
98
2011
246
72
174
10%
-6%
1%
CAGR
(millions)
Middle Class Others
(USD bn at 2005 prices)
Source: Central Statistics Bureau, MP3EI, HIL analysis
Investor and Analyst Day 2012 25
© 2012 Holcim Ltd
Investment priorities backed by economic corridor
approach Indonesia’s Economic Corridors
Medan
Palembang
Jakarta
Surabaya
Yogyakarta
Pontianak
Banjarmasin
1
1
2 Java
Industry and social
provisions
3 Kalimantan
Mining and energy
reserves
4 Sulawesi
Fishery, energy, mining
5 Bali – Nusa Tenggara
Tourism, national food
support
6 Papua – Kepulauan
Maluku
Fishery, energy, mining
2
3
4
5
6
Sumatra
Production/processing of
natural resources
Source: MP3EI
Investor and Analyst Day 2012 26
© 2012 Holcim Ltd
Indonesia’s cement demand growth shows a strong track
record and is expected to continue its growth path
Cement demand of Indonesia 2005-2020E (in mtpa)
31 32 34 38 38 4148
55
+6.0%
+6.3%
+8.3%
20E
89
19E
84
18E
79
17E
75
16E
70
15E
66
14E
62
13E
59
12E 11 10 09 08 07 06 05
Main drivers are urbanization (in Java) and infrastructure and housing development
(Sumatra, Kalimantan)
Capacity - exisiting & new players - with local clinker only
Capacity - existing players - with local clinker only
Cement Demand
Source: HIL analysis
Investor and Analyst Day 2012 27
© 2012 Holcim Ltd
Holcim Indonesia’s existing footprint is concentrated in
Java
Existing footprint 2012
Johor Bahru
Cement Grinding
1.2 mtpa
Ciwandan
Cement Grinding
0.7 mtpa
Naragong Plant
2 kiln lines of 4’600 tpd
and 8’000 tpd
3.9 mtpa clinker
4.7 mtpa cement
Tuban Plant (as of 2014)
1 kiln line of 4’000 tpd 1.2
mtpa clinker
1.7 mtpa cement
Cilacap Plant
1 kiln line of 7’800 tpd
2.4 mtpa clinker
2.9 mtpa cement
Grinding plant Cement plant Cement flow Clinker flow Under construction
Holcim
(Malaysia)
Investor and Analyst Day 2012 28
© 2012 Holcim Ltd
Tuban – Construction work is proceeding according to plan
Investor and Analyst Day 2012 29
© 2012 Holcim Ltd
• Enhance cost leadership position in Java through
commissioning of first line in Tuban (East Java) end of 2013
• Catch up with fast growing Java and the Islands through
second line in Tuban
• Expand asset footprint in Southern Sumatra to further optimize
cost-to-serve position in this key market
Footprint strategy to improve competitiveness across
Indonesia
Investor and Analyst Day 2012 30
© 2012 Holcim Ltd
Agenda
Regional Overview and Trends 2
Business Subregion India 12
Business Subregion Lower Mekong Subregion 19
Business Subregion Indonesia 24
Regional Contribution to Holcim Leadership Journey 31
Concluding Remarks 45
Investor and Analyst Day 2012 31
© 2012 Holcim Ltd
Holcim Leadership Journey
Regional contribution
Capturing
more
than CHF
500 m
Organizational capability building and skills development critical to sustain performance
improvements
All workstreams to be supported by extensive capability / skills building programs across region
Commercial and Logistics (outbound)
• Refinement of Price and Margin
Management
• Sales Force training
• New products and services
• Improve logistics infrastructures,
processes and fleet management
capabilities (cycle time reduction)
Energy Activation (Project EARN)
• Coal/Petcoke sourcing and pooling
• Alternative/renewable energy
• Expand Geocycle business
• Increase efficiencies across
manufacturing (e.g. automation)
• Application of grinding aids
• Mineral components
applications/enhancers
Procurement
• Bottom-up assessment by
OpCo’s and HGRS
Corporate Procurement
• Further savings from local
procurement activities to be
expected
RMX / AGG
• Increase of RMX business
• Expand Value Added
Solutions applications and
penetrate LIP (Large and
Infrastructure Projects)
segment
Finance
• Fixed cost reduction
• NWC reduction/optimization
• Disposal of non-operating
assets
Investor and Analyst Day 2012 32
© 2012 Holcim Ltd
Holcim Leadership Journey
Example: Customer Excellence
Project SMX (Sales & Marketing Excellence) in ACC, India
2007-2009
SMX
2010
SMX EDGE
2010-2011
30:30
2011-2012
Institutionalizing
Excellence
• Develop market
understanding
• Improve market
discipline
• Build loyalty among
channel partners
• Strengthen
frontline capability
• Up-skill change
agents (coaches as
force multipliers)
• Improve channel
health
• Sell out 30 mt
profitably
• Develop market
and build loyalty in
preparation for
over-supply
situation
• Strengthen
organization
capacity and
capabilities to
enhance
sustainability
5 critical workstreams
Leadership
Journey
Develop and
deploy through
coaches
Tools and modules
Governance
Performance cells
Investor and Analyst Day 2012 33
© 2012 Holcim Ltd
2009/2010 2011 2012 2013
Conduct sanity checks regarding tools & processes
Track implementation on country & regional level
Conduct region-wide expert training for Pricing Managers
Implement region-wide Community of Practice
Conduct country specific training for Sales Force
Train Pricing Managers on country level
Define SOPs1) for most critical pricing processes
Develop approach for B2B customers
Launch tools & processes for retail customers
Improve price & margin transparency
Review & assess existing pricing policies
Build
the
fou
nd
atio
n
Develo
p
capabili
ties
Ensure
susta
inabili
ty
1) SOP: Standard Operating Procedure
Way
forward
Holcim Leadership Journey
Example: Pricing and Margin Management, 2009-2013
Investor and Analyst Day 2012 34
© 2012 Holcim Ltd
• Growing populations, larger savings and rapid
urbanization drive higher construction growth in
Asia (Ø 2010-2020E)
• India: 8.8% p.a.
• Thailand: 4.9% p.a.
• Indonesia: 6.6% p.a.
• Vietnam: 9.6% p.a.
• Global: 5.2% p.a.
• India’s will be the world’s third largest construction
market by 2020E (7% of global share)
• India and Indonesia as main contributors of global
construction growth between 2010-2020E (after
China and the US)
Our opportunity
The continuing shift of construction growth towards Asia
Upper picture: Central Embassy development, Bangkok, includes a 30 storey five star hotel
Lower picture: Menara Palma, Golden Triangle, Central Business District, Jakarta Source: Global Construction 2020, 2011
Investor and Analyst Day 2012 35
© 2012 Holcim Ltd
Our opportunity
Construction growth in Emerging Asia
Construction Market Outlook until 2016 (USD bn)
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
1′400
1′300
1′200
1′100
1′000
900
800
700
600
500
400
300
200
100
0
Europe
North America
Africa Middle East
Latin America
Asia Pacific
(emerging markets)
Asia Pacific
(developed markets)
Forecast
Source: BMI Market Outlook, 2012
Investor and Analyst Day 2012 36
© 2012 Holcim Ltd
Holcim Leadership Journey
Example: Value Added Solutions (SpeedCrete)
• SpeedCrete is a
fast-track repair
service for
infrastructure
ensuring
uninterrupted
business
• Main strengths • Easy to place
• High performance
and durability
• Holcim-owned
technology
Port Authority of Jakarta: Same day services
Investor and Analyst Day 2012 37
© 2012 Holcim Ltd
Holcim Leadership Journey
Example: Innovation Hub in Singapore
• The Centre of Excellence (CoE) was
built with the support from the
Singapore Economic Development
Board (EDB)
• Aligned with Government of
Singapore economic development
priorities
• The CoE is dedicated to the
development of sustainable and
value-adding services
encompassing green solutions,
productivity enhancing solutions,
customized solutions and innovative
materials technology solutions
Investor and Analyst Day 2012 38
© 2012 Holcim Ltd
• Fast urbanization and infrastructure
need in Asia require a focus on Large
and Infrastructure Projects (LIP)
• Regional Team has been evoked to • build-up capabilities
• foster segment-specific domain
expertise
• leverage global and regional network
• The vision of “Building Asia Together”
led to the successful LIP Forum in
Singapore with more than 240
participants from more than 140
companies
Holcim Leadership Journey
Approach to Large and Infrastructure Projects
Investor and Analyst Day 2012 39
© 2012 Holcim Ltd
Holcim Leadership Journey
Approach to Large and Infrastructure Projects
Commercial Excellence example: Regional LIP approach
Investor and Analyst Day 2012 40
© 2012 Holcim Ltd
Holcim Leadership Journey
Organization to serve Large and Infrastructure Projects
Head of Regional
AGG & RMX
Team
Regional
Support
LIP Coordinator
Regional
Commercial
Coach
Regional AGG &
RMX Team
LIP Core Team Solution Selling /
VAS
Concrete
Technology
HGRS Global
LCP* Team
Regional
functional team
with OpCo
representatives
Representative
from regional
Innovation Hub
in Singapore
Functional Team
within Holcim
Group Support
* LCP = Large Construction Projects
Investor and Analyst Day 2012 41
© 2012 Holcim Ltd
Holcim Leadership Journey
Cost Leadership in Energy
Measure for
transparency
Best practice
sharing through
regional com-
munities of
excellence Develop
Capabilities
(People) and
Capacities
(Infrastructure)
Create
academy and
equip them to
drive energy
projects
Drive on-ground
cultural change
Create
competitive
advantage
EARN
(Energy
Activation across
our Regional
Network)
How will we get
there? Where do we want
to be?
Achieve 10%
reduction in annual
energy costs by
2015:
“USD 200 m annual
savings”
Where we are
today?
• Energy is 43% of
our overall costs
• Cost of energy will
continue to raise at
~ 10% CAGR
• Our regions energy
expenditure will be
~ USD 1.9 bn in
2014
“New energy culture
to improve efficiency
of production,
products and
consumption to
reduce or limit energy
usage”
Investor and Analyst Day 2012 42
© 2012 Holcim Ltd
Holcim Leadership Journey
Cost Leadership in Energy
• Reduction of energy cost by USD 150 million annually by 2014
• Introduces a new standard for Energy Management Excellence building on
elements covering operations as well as sourcing
Capabilities (People) and Capacities (Supply Chain-Infrastructures)
Development
Lean Energy Culture
Coal
Sourcing
and
Pooling
Alternative
and
Renewable
Energy plus
CO2
Reduction
Thermal
Energy
Process
Admixtures
and Clinker
Factor
Reduction
EARN
Objectives
EARN
Set-up
Electrical
Energy
Process
Energy
Management Excellence
Investor and Analyst Day 2012 43
© 2012 Holcim Ltd
Holcim Leadership Journey
Cost Leadership in Logistics
New ACC set-up in East India region
Plant set-up in a Hub-and-Spoke
System delivers significantly lower
cost-to-serve due to:
• Clinker production close to raw
materials (limestone, coal)
• Lower cargo volumes due to clinker
transportation to grinding units vs. direct
cement dispatches
• Grinding units are located close to the
market and in vicinity to mineral
components for blending (fly ash)
• Savings of approx. 6 USD/t
Hub-and-Spoke system to improve cost competitiveness through
supply chain optimization
Investor and Analyst Day 2012 44
© 2012 Holcim Ltd
Agenda
Regional Overview and Trends 2
Business Subregion India 12
Business Subregion Lower Mekong Subregion 19
Business Subregion Indonesia 24
Regional Contribution to Holcim Leadership Journey 31
Concluding Remarks 45
Investor and Analyst Day 2012 45
© 2012 Holcim Ltd
Plenty of opportunities to catch!
Investor and Analyst Day 2012 46
Grinding
Capacity
Expansion
Bangladesh
Footprint in
Myanmar
Footprint in
Cambodia
Footprint in
Sumatra Capacity Expansion in
East Java
Footprint in
Kalimantan
Capacity Growth in South
Vietnam
Capacity Expansion
in Thailand
Capacity
Expansion India
Capacity
Expansion Sri
Lanka Capacity Expansion
Malaysia
Capacity Expansion
in the Philippines
© 2012 Holcim Ltd
Disclaimer
Cautionary statement regarding forward-looking statements
This presentation may contain certain forward-looking statements relating to
the Group’s future business, development and economic performance.
Such statements may be subject to a number of risks, uncertainties and other
important factors, such as but not limited to (1) competitive pressures; (2)
legislative and regulatory developments; (3) global, macroeconomic and
political trends; (4) fluctuations in currency exchange rates and general
financial market conditions; (5) delay or inability in obtaining approvals from
authorities; (6) technical developments; (7) litigation; (8) adverse publicity and
news coverage, which could cause actual development and results to differ
materially from the statements made in this presentation. Holcim assumes no
obligation to update or alter forward-looking statements whether as a result of
new information, future events or otherwise.
47 Investor and Analyst Day 2012