Strong franc takes bite out of cement maker Holcim's earnings

By John Revill

ZURICH (Reuters) -Holcim became the latest Swiss company to see the strong Swiss franc take a bite out of its figures when the building materials maker reported on Thursday its first earnings since separating its North American business.

The Swiss cement and roofing products maker posted a drop in second-quarter sales in the three months to the end of June, as the rise of the safe-haven currency cancelled out local currency sales increases.

The franc strengthened against the euro, Mexican peso, and sterling after U.S. President Donald Trump's tariff announcements in April, reducing the level of sales abroad when translated back into Holcim's reporting currency.

The company's reported sales fell 3.8% in the quarter to 4.18 billion francs, as foreign exchange effects cut 267 million francs from its top line. With currency effects removed, sales would have been 2.4% higher.

Swiss construction chemicals maker Sika earlier this week reported a dip in first-half sales as the weakness of the dollar reversed an increase when measured in local currencies.

Although Holcim's profit rose, it was also held back by currency effects, which reduced operating profit by 81 million francs.

In its first set of results since separating its North American business, the building materials maker posted a 1.2% increase in recurring operating profit to 955 million francs, ahead of analyst forecasts.

Without translation effects, profits would have been 9.8% higher, as Holcim increased margins by selling more of its low-carbon cement and concrete and its recycled building materials.

Holcim shares were indicated 1.3% higher in premarket activity in Zurich.

Holcim separated its North American business into a separate entity, called Amrize, on June 23.

In its first guidance for 2025 as a standalone business, Holcim said it expected to increase its operating profit, when measured in local currency, by 6-10%.

It also guided for sales growth of 3-5% in local currencies.

($1 = 0.8131 Swiss francs)

(Reporting by John Revill. Editing by Miranda Murray and Mark Potter)