Saint Gobain: after the records of 2022, the change continues

Last year, the construction materials giant saw its net profit fall by 11% compared to 2022, to 2,67 billion euros on a turnover down 6,4% to 47,94 billion euros, the group indicated in a press release, nevertheless highlighting a “record” operating margin at 11% and “increasing in all regions”.

For 2024, the group anticipates a declining market in new construction in Europe which "will remain difficult", even if the renovation markets should "resist", underlined the group's general director, Benoit Bazin, during a telephone presentation results to the press.

Last year, turnover in Northern Europe fell by 23%, affected by the construction crisis and impacted by the sale of activities linked to distribution in Great Britain.

The drop in activity in Northern Europe amounts to -5,9%, and -0,9% in Southern Europe (including France), Saint-Gobain underlined.

“In a geopolitical and macroeconomic environment which remains difficult,” the group believes it has “shown” in 2023 “the effectiveness and relevance” of its “strategic choices,” said Mr. Bazin.

He highlighted the reorganization of the group by country, the creation of a “construction chemicals” division driven by a series of acquisitions in high-growth countries in North America and Asia, and good environmental performance with the deployment of low-carbon construction solutions.

“We can achieve profitable growth while reducing our CO2 emissions,” said Mr. Bazin after recalling the 34% reduction in the group’s operational CO2 emissions (scope 1 and 2, not including indirect emissions). in 2023, compared to 2017.

For 2024, and "for the fourth consecutive year", the group forecasts "a double-digit operating margin rate in a context where some of our markets are in decline" he said, after the 11% of 2023.

A manufacturer of plasterboard, rock wool and glazing, Saint-Gobain has been driven in recent years by thermal building renovation programs encouraged around the world thanks to massive public aid plans to reduce energy consumption and CO2 emissions, and thus meet climate requirements.

“Plane cut”

According to analysts, it has also reaped the first fruits of its own radical reorganization, based on all-out geographic decentralization, and a revamped portfolio of high value-added activities in "growth" countries like Canada, South America or Southeast Asia.

For France, where a "budgetary cut" has just been announced for 2024 on public aid for energy renovation (Ma PrimRenov'), Mr. Bazin preferred to see "the glass three-quarters full".

“Certainly, we went from 5 billion to 4 billion euros (budgeted aid, Editor's note), but we come from 2,7 billion, so in fact MaPrimeRenov increases to 4 billion in 2024 from 2,7 billion in 2023, it is a very strong increase” he underlined.

"I had pleaded for a Marshall plan for energy renovation, there was a parliamentary report last year saying that 15 billion were needed, and we went from zero to 2,7, then 4, which goes into the right direction and at the right speed” he pleaded. “We can’t do much faster.”

Wednesday evening, the Minister of Ecological Transition Christophe Béchu indicated that instead of targeting 200.000 overall renovations in 2024, France was now planning "rather 140.000 or 150.000".

“It’s almost three times what we did in 2023, it’s just more realistic than having overly ambitious objectives and not achieving them,” said Benoit Bazin.

Saint-Gobain will propose a dividend increasing by 5% to 2,10 euros per share for 2023, during its general meeting on June 6.