Saint-Gobain's Q3 volumes narrowly beat expectations as renovation resilient
By Anna Peverieri
Oct 29 (Reuters) -French construction materials group Saint-Gobain SGOB.PA on Tuesday reported third quarter volumes slightly above analyst expectations as resilience in building renovation offset weakness in Europe and a decline in new construction.
The company, which designs, manufactures and distributes materials for the building and industrial market, said its third quarter volumes were down by 1.5% year-on-year, compared with the 1.6% decline analysts expected.
Saint-Gobain confirmed its outlook for the rest of the year and said it expected a further increase in operating margins in 2024.
WHY IT'S IMPORTANT
Investors are scrutinising the sector for signs of recovery after a challenging year marked by rising raw material costs, interest rates, geopolitical tensions and inflation.
CONTEXT
Saint Gobain's main competitor French infrastructure group Vinci SGEF.PA last week reported third quarter revenue below expectations and voiced concerns over a corporate income tax rise the French parliament is considering. It said it could cost it 400 million euros ($432.12 million).
Swiss industrial and construction chemicals company Sika SIKA.S last week reported an increase in its third quarter sales, boosted by a large number of infrastructure projects.
BY THE NUMBERS
Saint-Gobain reported third quarter sales at 11.6 billion euros, in line with analyst expectations, buoyed by recent acquisitions, but affected by the weakness of the new construction market, especially in France.
Since the beginning of the year, it has announced several strategic acquisitions, focusing on enhancing its portfolio in construction chemicals, metal building products, and surface finishes.
Sales in Europe, Middle East & Africa were down 4.5% in the third quarter, the company said in a statement. In the region, it said renovation was resilient and accounted for around 60% of sales. In the Asia-Pacific region, the French construction materials group saw a 0.9% decrease in like-for-like sales in the third quarter, with a rise in volumes driven by India.
($1 = 0.9257 euros)
Reporting by Anna Peverieri; editing by Barbara Lewis
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