Holcim Ltd

Bernard Fontana - Chief Executive Officer Thomas Aebischer - Chief Financial Officer

Remo Rosenau - Neue Helvetische Bank Martin Husler - Zurcher Kantonalbank Paul Roger - Exane BNP Paribas Robert Muir - Berenberg Bank Robert Gardiner - Davy Stockbrokers Yuri Serov - Morgan Stanley Christian Arnold - Bank Vontobel Elodie Rall - JPMorgan Gregor Kuglitsch - UBS Investment Bank Mike Betts - Jefferies Patrick Appenzeller - Helvea Baader

So ladies and gentlemen, good morning, and welcome to Holcim Investors and Analysts Conference on Q4 and Full-Year 2014 Results. I’m happy to present them to you together with Thomas Aebischer, our CFO.

Holcim achieved solid like-for-like performance in the financial year 2014, with a strong fourth quarter. This achievement was support by a significant of our achievements in our Holcim leadership journey.

Since we launched it in mid-2012, the Holcim Leadership Journey delivered cumulative operating profit contributions of CHF 1.85 billion well ahead of the originally targeted CHF 1.5 billion. Like-for-like group cement volumes increases were driven by the regions, Asia, North America, in which the U.S.

being a strong contributor and Africa Middle East. This volume increase together with a solid pricing environment in many markets yielded higher like-for-like net sales, operating EBITDA, and operating profit.

For the full-year, group operating profit on a like-for-like basis increased by 4.2%, despite restructuring and merger-related costs of CHF 149 million. Adjusted for this charges, like-for-like operating profit in 2014 increased by 10.6%.

These results were supported by a strong Q4 with an improvement of the operating like-for-like profit adjusted for restructuring and merger-related cost of CHF 58 million by 19.3%. The operating profit margin adjusted for the already mentioned costs improved from 12% in 2013 to 12.9%.

Adverse exchange rate involvement continued to ease during the final quarter, and had no negative impact on our Q4 results. On the full-year basis, however, the negative impact on our results was still substantial.

The proposed merger with Lafarge remains on track for closing by mid-2015 and most - as most competition clearances have been obtained. In addition, we announced on February 2, 2015, that the divestment of certain assets has been initiated with a firm commitment from CRH.

These divestments, however, are subject to the completion of the merger with Lafarge. For 2015, Holcim expects like-for-like operating profit, excluding merger-related costs to be between CHF 2.7 billion to CHF 2.9 billion.

This guidance is given on the Holcim standalone basis and isn’t connected to the proposed merger with Lafarge. Now, the Holcim Leadership Journey.

The Holcim Leadership Journey continued to make substantial contributions to our results. For the full-year 2014, the cost leadership and the customer excellence effort supported the operating profit with CHF 748 million.

Overall, as I was sharing in the introduction, the program provided a cumulative contribution of CHF 1.85 billion, which is well ahead of the original target of CHF 1.5 billion. In the fourth quarter, the Customer Excellence Stream continued its momentum improving by CHF 35 million, bringing its total contribution to CFH 414 million since the start of the program.

And we’re confident that our increased customer focus will continue to be a strong profit contributor in the future, especially in markets, where the volume recovery is not yet very strong. The cost leadership stream with our four categories delivered good results in line with the trends seen in the previous quarters.

The overall contribution since the program started amounted at year end to CHF 143 billion, 43% above the original target. I would like to highlight the fact that this result is not only due to one category being the star, but with all four categories exceeding the original target.

And this reflects the continued alignment and focus of Holcim team’s performance. Although we no longer give a specific guidance beyond 2014 for this program, our effort under the Holcim Leadership Journey will continue.

Continuous cost efficiency and productivity improvements are embedded in our organization, processes, and culture, which will help us improving our profitability further. Let me now give you a more detailed overview of the 2014 performance in our five group regions.

Asia Pacific’s economic climate was characterized by the start of a rebound in the Indian economy and solid growth levels in most other major markets in the region. Both Indian group companies of Holcim have benefited from the more promising situation in construction markets in the country.

Ambuja cements and ACC benefited from various commercial initiatives across the country that opened new markets and increased sales of premium products. Ambuja performed particularly well, with an operating EBITDA margin about 20%.

Holcim Philippines reported a strong increase in cement volumes, as the government continued to fund infrastructure projects, while the positive business environment has emboldened the private sector to push through with expansion plans. Volume developments in Indonesia was positive for cement and aggregates, while ready-mix concrete deliveries were flat.

In cement, the implementation of Customer Excellence initiatives and the opening of new markets contributed to the development which was particularly strong for bagged cement. The new kiln line of the Tuban plant in East Java was commissioned in the fourth quarter of 2014 but later than initially planned, therefore Indonesia had to face high distributions costs during the year.

Holcim Australia was impacted by the decline in resource sector investments, as large-scale projects, particularly in Western Australia, were completed in the course of 2014, and subsequently aggregates volume declined. In response to a continuing low growth environments and the decline of the resource sector investment, the group company adjusted its footprint and reduced headcounts to be more agile and more effective.

Operating profit in the group region, Asia Pacific, decreased 9.4% to CHF 934 million in 2014 with currency effects having a continuing negative impact coupled with lower performance of Holcim Australia and Indonesia. Like-for-like operating profit in the group region was down 1.7%.

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

Still Holcim Mexico sold more cement in 2014, driven by the overall more favorable economic situation that has led to increased cement demand, but also thanks to a variety of commercial measures. Fourth quarter figures were particularly strong.

Volumes in aggregates and ready-mix concrete declined significantly, impacted by the closure of several plants in 2013 based on our strategy to focus on the most profitable markets. After Holcim Ecuador reported solid cement volume growth over the last years, with 2013 being a record year, the group company was affected by the country’s declining cement consumption in 2014.

Public investment was subdued as a result of liquidity restraints by the government. Subsequently, deliveries in all three segments declined.

Brazil’s economic situation remained difficult following the Soccer World Cup and 2014 federal elections. Holcim Brazil, with its presence in the southeast of the country, could however increase cement sales supported by strong demand mainly in Rio de Janeiro but also in Sao Paulo and Espirito Santo.

Following the strategic rightsizing of the ready-mix concrete business last year, volumes decreased in this segment. Holcim Argentina sold less cement in 2014 following the very good performance of the year before, and as it was impacted by the country’s economic crisis.

Operating profits in the group region, Latin America, was down 8.2% to CHF 663 million, also impacted by currency. Like-for-like operating profit was down 1.1%, confirming the strength of this region backed by Mexico area, which has dropped down in 2014.

And now to group region Europe, with the exception of the United Kingdom, the recovery of the European economy slowed down in the course of 2014, as major markets reported lower than expected growth rate and political uncertainties took their toll. In the UK, aggregate industries UK benefited from high demand for building materials in all its businesses.

Aggregates volumes were up significantly and the group company’s strong position in the London market and ongoing growth in commercial and residential real estate construction led to a significant increase in ready-mix concrete volumes. Holcim France suffered from cement volume declines in the course of 2014, leading to lower deliveries for the full year.

Holcim Germany, like several other group companies in the region, benefited from the mild winter, but growth of cement and aggregates volumes flattened out in the second half of 2014. Holcim Switzerland was impacted by increased pressure through cement imports and stronger domestic competition which led to lower volumes in this segment.

In Italy, volumes declined in all three segments as a result of the further worsening market development. Holcim Spain recorded increases in cement volumes that were mainly supported by exports, while domestic volumes also started to develop favorably.

Following the footprint adjustment in the second quarter of 2014, aggregates and ready-mix concrete volumes decreased. Holcim Azerbaijan was faced with increased competitive pressure by two new local cement producers and more imports from Iran.

Subsequently, the group company was unable to maintain the high volumes of the previous year and sold less cement. In Russia, Holcim grew well above the market average thanks to infrastructure project.

Still, operating profit in the group region Europe increased markedly by 16.8% to CHF 510 million thanks to the disciplined cost management and thanks to restructurings. Like-for-like operating profit growth was 16.1%.

The restructuring of certain of Holcim’s operations in 2014 had an unfavorable impact of CHF 38 million. The group’s overall presence in Europe was strengthened through a series of transactions with Cemex, closed in early 2015.

Holcim acquired Cemex’s operations in western Germany and The Netherlands, while Cemex took over Holcim Czech Republic with all its subsidiaries in the country. In Spain, Cemex purchased Holcim’s Gador cement plant and Yeles grinding station, while Holcim has kept its remaining operations.

As a result of the transactions, Cemex paid Holcim CHF 45 million in cash and Holcim expects sustainable additional operating EBITDA of at least €10 million on a yearly basis, as a result of these transactions. Now, North America, following a slow-paced recovery in 2013, the United States economy strengthened in the course of the year under review.

A decline in private debt, improved corporate liquidity, and improved unemployment data contributed to the positive development. With the resolution of the debt-ceiling crisis uncertainty was considerably lower than in the previous year.

At Holcim U.S., cement volumes increased markedly over the course of the year, fueled by the overall recovery in cement consumption and some market share gains. The group company also benefited from a new supply contract in Illinois.

The Northern Central region recorded particularly high demand and July was a very strong month for the group company, with the highest monthly sales since 2008. Aggregate Industries US also benefited from the dynamic U.S.

economy and reported growth in aggregates volumes across most of its region. Increases were strongest in the West Central and the Twin Cities areas.

Ready-mix concrete volumes were impacted by the sale of certain operations. Robust increases in asphalt volumes were driven by increased construction activity in major regions, assisted by several large paving projects.

In a highly competitive market environment, Holcim Canada sold more cement thanks to higher demand in Western Canada which was partially offset by lower volumes in the Quebec and Atlantic regions. Shipments of aggregates increased markedly, mainly attributable to higher crushed stone demand in Ontario.

Holcim Canada also sold more ready-mix concrete and asphalt, driven also by better pricing. Operating profit in North America grew markedly by 58.3% to CHF 314 million based on the good performance of both U.S.

group companies. Like-for-like operating profit growth reached 65.1%.

Performance in North America was particularly strong in the fourth quarter, which shows significantly increased results based on the U.S. Cement sales were up 14.6% and net sales increased 15.7%.

Profitability was up, as well with a plus in operating profit of 90% from CHF 52 million to CHF 99 million. And finally, let’s take a look at group region, Africa and Middle East.

Economic developments in the group region, Africa and Middle East, was highly heterogeneous, and political tensions and uncertainty impacted a number of Holcim market in 2014. Growth of the economy was rather modest in countries that like Morocco and Lebanon, whereas the Ivory Coast and Madagascar were among the fastest growing economy.

Holcim Morocco reported higher cement volumes, while domestic demand was lower, the group company benefited from clinker exports to the Ivory Coast. Less dynamic activity in residential construction which represents the majority of the local market was the main driver behind the domestic development.

Aggregate and ready-mix concrete volume decreased. In Lebanon, Holcim Lebanon helped cement sales, but lost on ready-mix concrete volumes.

In the Indian Ocean region, Holcim sold more aggregates than ready-mix concrete, many thanks to the group’s operations in La Reunion where Holcim is involved in a major road building project. In Africa and Middle East, operating profit increased slightly by 1.6% to CHF 220 million in the year under review, like-for-like operating profit growth was 5.8%.

And I will now hand over to Thomas for other key financial figures. Thomas, yours.

Okay. Thank you very much, Bernard.

Good afternoon, I would like to start with the fourth quarter. The fourth quarter of 2004, delivered a solid performance with like-for-like operating profit adjusted for restructuring and merger related costs up by 19.2%.

Group’s cement volumes were flat in the quarter with strong performance in the U.S., Mexico, the Philippines, Ambuja Cements in India and Spain. These positive developments were offset in France, Russia and Ecuador.

Flat aggregate sales in the quarter reflect generally lower infrastructure investments. Ready-mix volumes declined in a combination of lower volumes in Europe as well as in Latin America.

In Q4 2014, Holcim has been able to improve its financial performance further and posted like-for-like increases in net sales, operating EBITDA and operating profit. Better cement pricing of plus 2.4%, compared to the fourth quarter of 2013 and our continued focus on cost savings paid off.

Operating EBITDA and operating profit reported a solid increase of 5.9% and 8.9% like-for-like despite restructuring and merger related cost of CHF 56 million and CHF 68 million respectively. Excluding these costs reported operating EBITDA was increased by 11.8%.

Margins increased further with the operating EBITDA achieving 12.3%, up from 11.7% a year earlier. Adjusted for restructuring and merger related cost, the margin was at 13.5%.

In December 2014, as announced Holcim has received the last installment of US$97.5 million from Venezuela as agreed in 2010 as a compensation payment for nationalization of Holcim Venezuela in 2008, a gain of CHF 56 million, it’s included in other financial income. In 2014, group-wide like-for-like cement volumes increased by 1.4% to 140.3 million tonnes, driven positive - driven by positive development in the United States, the Philippines and India offsetting lower volumes in Azerbaijan, Ecuador, Italy and has already had been mentioned by Bernard in Argentina.

Cement pricing in 2014 improved by 2.5% with strong positive contributions from the U.S., Ambuja Cements in India and in Mexico. Aggregates volumes were flat in 2014 primarily the result of the segment’s restructuring during 2013 in Latin America.

Pricing, however in 2014 was up by 2.2%. Ready-mix concrete year [ph] volumes were lower, the result of restructuring and divestment activities as well as the market contraction in Latin America.

On a like-for-like basis, net sales, operating EBITDA and operating profit all improved compared to the previous year. The operating EBITDA and operating profit margin adjusted for restructuring and merger-related costs were CHF 138 million and CHF 149 million respectively, improved from 19.8% to 20.3% on EBITDA level, and from 12% to 12.9% on operating profit level, which is the result of disciplined pricing, our efforts achieved under the Holcim leadership journey and the respective restructuring measures taken.

Net income attributable to Holcim shareholders increased by 1.2% despite the gain of CHF 136 million on the sale of the 25% stake in Cement Australia, which was recorded in 2013. Cash flow from operating activity was down by 10.3%, mainly due to negative foreign exchange impact.

On a like-for-like basis, cash flow was up - was decreased by 6.4%. The board of directors proposed that at the next annual shareholder meeting, the approval of an unchanged dividend of CHF 1.30 in line with Holcim’s dividend policy of one-third of net income.

Q4 2014 marks the return to a slight tailwind with regard to the translational impact of the ForEx movement of the five consecutive quarters of substantial negative ForEx translation impact. Net sales benefited by CHF 90 million, while operating EBITDA was reported by CHF 6 million.

For the full year 2014, however, the impact remains sizable with a negative translation impact on net sales of about CHF 1 billion, around minus CHF 210 million from operating EBITDA and nearly CHF 150 million negative impact on operating profit level. For 2015, we expect again some headwinds after the Swiss National Bank’s decision to abandon the Swiss franc euro peg at CHF 1.20.

This impact however is translational only. Holcim has a natural hedge in place as most cost and revenue occur in the same currencies.

Full year operating profit reached CHF 2.3 billion, an increase of 4.2% from a like-for-like basis. Adjusted for restructuring and merger related costs of CHF 149 million, operating profit increased by 10.6%.

Benefits from a mild winter and restructuring initiatives in Europe, particularly visible in Aggregate Industries UK, a stronger economy in the U.S. and the recovery at Holcim Mexico, had been partially offset by adverse developments, mainly in Indonesia, Azerbaijan, Spain, Brazil and Argentina.

The reported operating profit margin increased from 12% in 2013 to 12.1%, adjusted however for restructuring and merger related costs, operating profit margin is up by - about at 12.9%. When looking at the operating profit bridge for 2014, we see a picture that gives way for optimism, as volume and price increase, price improvements, more than offset the negative impact, from increased variable and fixed cost.

Fixed cost excluding the restructuring and merger related costs of CHF 149 million remain flat year-on-year. This is a great achievement and further proof of our capability to control costs where the development is in our own hands.

The Holcim leadership journey continues to be an important contributor to earnings quality, as the markets alone still do not yet allow us to cover the persisting cost inflation in some countries, entirely to higher price. Variable costs measured by cost inflation without considering volume movements increased by 2.7% in 2014, a combination of 3.7% higher distribution costs, and 2.3% increased production costs.

Distribution costs increased in Indonesia and India, while production cost increases were more pronounced in Argentina, mainly driven by high inflation in Indonesia and Ambuja Cements in India. In 2014, Holcim realized total operating profit contribution from CO2 for CHF 47 million.

This is CHF 21 million more than in 2013, as we took advantage of favorable stock prices for a nationwide in the fourth quarter. Operating profits by region.

Asia Pacific decreased its operating profit by 9.4% to roughly CHF 930 million. On a like-for-like basis and supported by cost savings, the decrease amounted to 1.7%.

The negative currency impact of over 7% was too much to be fully offset by positive volume and price dynamics in the region. The operating profit for Latin America deteriorated by 8.2% to roughly CHF 660 million.

Positive contributions from Mexico, where we managed to improve the operating profit substantially to a combination of higher cement volumes and prices were offset by cement volume drop in other markets and the higher variable costs in Argentina and Brazil. On a like-for-like basis, operating profit for Latin America decreased 1.1%.

In Europe, operating profit improved by around 17% to CHF 510 million. A large part of this growth was attributable to successful restructuring initiatives executed in many countries in Europe in the last years, coupled with good cost discipline.

Additionally, Aggregate Industries UK benefited a lot from a dynamic construction market. On a like-for-like basis, operating in Europe decreased by 16%.

A Group region North America posted the highest operating profit growth of 58% and 65% on a like-for-like basis to CHF 340 million. This growth was entirely attributable on the ongoing solid recovery in the United States, where both Holcim U.S.

and Aggregate Industries US improved markedly. Operating profit in Canada more or less remained stable.

In Group region Africa Middle East improved operating profit by 1.6% to CHF 220 million. Positive cement volume dynamics across the region, together with price increase in some countries resulted in an increase of operating profit for the region by 5.8%.

Net income attributable to Holcim shareholders increased by 1.2% to CHF 1.287 billion. Below operating profit, other income decreased to CFH 178 million from CHF 204 million a year earlier when it was mainly driven by the gain on the disposal of the 25% stake in Cement Australia, which I’ve mentioned earlier.

Financial income was flat in 2014, as the last payment from Venezuela was received in December of 2014, contributing as mentioned earlier CHF 56 million in the fourth quarter on profit. Financial expenses decreased markedly from CHF 777 million to CHF 611 million, mainly due to lower interest expense and lower foreign exchange losses.

The overall financing surplus for 2014 amounted to CHF 53 million, cash flow from operating activities was down 10.2% to CHF 2.5 billion, compared to the same period in 2013. Cash flow improvements in North America and the corporates were more than offset by adverse performance in Australia, in France, and Indonesia.

In 2014, investments to sustain the asset price increased slightly to CHF 738 million on a net base. Expansion investments at CHF 1 billion was down 20.4%.

Moving to financial positions, total shareholders’ equity decreased to CHF 20.1 billion. Net financial debt increased in absolute terms by CHF 183 million, compared to 2013.

This was due to negative foreign exchange impact on net financial debt of CFH 250 billion. And with this, thank you very much for your attention.

I would like to hand over to Bernard. Thank you.

And now for the outlook of 2015. Holcim expect cement volumes to increase in all group regions in 2015, with the exception of Europe.

Aggregates and ready-mix concrete volumes are expected to increase. On a standalone basis and with no connection with the proposed merger with Lafarge, the Board of Directors and the Executive Committee of Holcim expects like-for-like operating profit adjusted for merger-related costs to be between CHF 2.7 billion and CHF 2.9 billion in 2015.

Higher pricing and ongoing cost savings are expected to offset cost inflation, leading to a further expansion in operating margins in 2016. Ladies and gentlemen, with this, I would like to conclude our introductory presentation and open the call for your questions.

First question in the row?

[indiscernible] I have two questions, if you don’t mind. First, you mentioned India, but mainly Ambuja, could we have the contribution - consolidated contribution in term of sales and EBITDA for both ACC and Ambuja?

Secondly, could we have more flavor in Australia in term of sales and EBITDA contribution? Thank you.

Yes. So I will start by India with a brief recap on the - particularly on the market situation.

The market that was roughly around 2013 - CHF 235 million tonnes in 2013 moved to CHF 247 million tonnes in 2014 according to estimates of roughly 5%. In this environment, ACC increased its volume by roughly 1%, and Ambuja by 2.4%, so a bit of difference that is linked with, at least, with both volumes.

But most important, the two companies were focused on their margin and the price. For the full-year, if I take the price per bag then, of course, I know the distribution cost happened, but that effect was happening on the market.

For the full-year, ACC could improve its price per bag by INR 8, while Ambuja could improve by INR 14. And I need to give you a bit more detail according to the regions, yes.

In the North region, ACC could improve by INR 16, while Ambuja could improve by INR 20. In the East region, the price decreased by INR 4 ACC and by INR 2 at Ambuja.

And it was then a high price region. As I said, predominantly from pressure from the south.

In the West, which is our Ambuja region, Ambuja could increase INR 16 and ACC INR 9. In the South, which is only a place where ACC could increase by INR 6.

So we could really change the trend compared with the previous year where we were reporting a decrease in price. Now, when we go to the EBITDA contribution, so the companies are published.

Ambuja finished with an operating EBITDA in Swiss francs of CHF 200 million with a margin of 20.3%, CHF 300 million, and ACC finished by CHF 253 million with EBITDA then 15% EBITDA margin. So you have the footprint, but there is also an event that happened in ACC at year end.

This is an oil company, and has all the mining permits that used to be renewed automatically, and there was a decision of Supreme Court making those renewals not automatic. And ACC faced difficulty with the permits in some eastern region like Chaba, impact in Chaba, impact there.

And fortunately, the government passed a decree to allow again these renewals so that the situation [indiscernible] the company is running. So it carried a bit of one-off cost at year-end.

So fundamentally, in India, we believe that now the country can enjoy more favorable sentiment. We believe that the price of oil that is going down is a plus for the country.

But We target a gross of 6%, which is not yet 8% now, I think in the market, but still a positive evolution. And also, what we see as a favorable element is the fast-track approval for infrastructure projects that are currently undertaken by the Indian government.

So the project would be published in a few days, so we need to see, but at least there are positive elements there. That’s probably for India.

In Australia, I will give the floor to Thomas, but fundamentally in Australia what’s happening is the transition of the economy from the heavily [indiscernible] with the mining resources that are [indiscernible] of China to a stronger housing and a little bit of structural adjustment revamp.

So in Australia, the total contribution on net sales in Swiss Franc is roughly combined cement, obviously with all the other businesses roughly CHF 1.7 billion, and on operating EBITDA contribution, it’s all in Swiss Franc the contributions is CHF 250 million.

Just a follow-up question, did you announce price hikes in India for 2015, so it’s not an early price, like, it comes from the pricing evolution, yes. The price we were selling at the beginning of the year, it was a positive evolution of the price.

Including in the south, which is not usually the difficult region because here, out of the CHF 120 million of the capacity, 18 plus are in the south. And the volume evolution, or the site evolution of the volume was moderate.

Globally, the companies had a good performance, with higher prices and a bit lower price [indiscernible].

We started the year very well in India, but let’s not make a mistake. This is not a price announcement like in a mature market, like in Europe or in the United States.

In India you go back by back, market by market, so that’s how you try to move the price in the right direction.

It’s Remo Rosenau, Neue Helvetische Bank. On Slide 30, you mentioned that energy costs per tonne of cement produced for 2015 is expected to be flat to slightly lower compared to 2014, of course, we understand that energy costs are not directly oil price, they are our electricity costs, which is more or less 61% for Holcim.

On the other hand, however, we have distribution costs, and the distribution costs are quite directly linked to gasoline price, [indiscernible]. And there you should see quite some relief, no?

And what would you expect in that sense on the distribution costs side? yes, that is the first question.

Okay. So I will use it to come back on the energy costs also, important question also.

So we finished the year with CHF 14.0 per tonne energy costs. And we were there already after nine months, that didn’t have stable in Swiss Franc, which is to compare at least CHF 14.6 last year, but very strong for us.

And in fact, at constant currency our energy cost increased a bit, which is the impact of the electricity increase in the component of energy costs. Maybe you remember I was commenting 64.7% increase of electricity price in Indonesia, very little increase in Philippines, the Lebanon, and significant impact respectively.

So we guide for 2014 with a bit of slightly under and because, yes, the sector is well oriented and this kind of themselves. Now you touched the repoint where I believe the restatement, which is the business components of our distribution costs, or even the cost of our trucks in [indiscernible].

So to give an idea our exposure to get there is in the round of CHF 1.2 billion, directly or indirectly, of course, sometimes it is exposure of our contractors, who are transport operators. Roughly half of it is tax, and this is meant to be favorable, and remains 0.36%.

And if you reduce by 15%, you can see a stake that’s 100%, which is a stake to potentially take or able to negotiate them and perhaps them about that whatever other evolutions [indiscernible]. So clearly one of the key priorities for the costs for us would be the high priority for distribution and the logistics cost.

Okay. And the second question would be a more general question.

Some media reports recently mentioned that not all shareholders would be totally happy with the merger and that there might be some opposition forming at the AGM of April 13. Have you been personally approached by some of these shareholders?

Do you expect a smooth AGM, or not so much a smooth AGM?

I will not comment on the shareholder stuff because these shareholders have a company dialogue, but, of course, we are aware of the media reports and some analyst reports on the exchange ratio. So what we can say is that the deal is driven by a business combination agreement.

That doesn’t include an automatic adjustment in case of divergence of performance by [Technical Difficulty]. And that’s the situation where we are at today, and I don’t want to further stipulate [Technical Difficulty].

Fair enough. Thank you.

Thank you.

Martin Husler with Zurcher Kantonalbank. Maybe just a quick add on, do you have any guidance of what Europe Cement did or what their view on the merger?

No, I don’t think we have guidance. You would have to talk with them direct.

At the moment, I think what we can say, we are going on roadshow now as we do normally after the year - after year end results and we will obviously engage and will meet these various investors. And they will let us know if they are positive or negative and then we will obviously have this discussion.

But I would also like to - so that takes place now over the next few weeks. The AGM is on the April 13, maybe coming back to your earlier question; we do not expect anything out of the ordinary, because at that AGM, clearly, if there is not an AGM where the capital increase will be voted for, we will have an EGM, a special EGM later in the first-half of this year where then the Holcim shareholders and both with respect to the capital increase, and obviously that’s then the decision of the shareholders everyone to support it or not.

We believe today, based on the knowledge we have, that this will be a positive outcome. As you know, we need two-thirds of the shareholders presence, but that’s not going to happen on the April 13, that will happen later in the EGM.

Okay. And then a question I wanted to ask before.

The production costs, can you please repeat the impact last year? I didn’t understand, you had a two points something increase?

Production cost increased by 2.3%. If you look at the total variable cost increase of 2.7%, production contributed to this at 3.3%.

And the higher amount that I have mentioned is the distribution cost impact. So clearly, more inflationary pressure on distribution, and actually, since we are talking about distribution, we talked about diesel, however, in certain countries like India, but also in the United States, now we actually already in certain parts of the U.S., we are experiencing shortages of capacity from trucking and on rail.

And as you start to experience these shortages, logically, the pricing power is in the hands of the providers and not of the customer now. So that’s where some of these inflationary pressures are coming from.

And your view on 2015, would you expect costs increase to be in about the same range or would you because of the oil price and diesel and so forth the price [ph] increase is pick up there. If some of the currencies remain so stubborn against inflationary pressure, taking Argentina for example, in Argentina we still have the situation, one of the reason why it contributes so negatively in Swiss francs is of massive inflation and not real devaluation, well, I’m making a broad statement, but I’m sure looking at the currencies in average over the year, you know what I’m talking about.

So if that remains - Argentina is pretty significant business, India is a pretty significant business. If that remains then most likely I would assume now based on the energy pricing is going, that mainly on the production side we should see slight lower percentages, 2.3% is very similar to 2013 actually.

So I would expect slightly a lower percentage. However, what we are working on in the production side is on electrical energy costs, I think we have on the thermal energy costings, real under control then we talked about electrical energy and all of it is on regulated markets, and there it’s just very, very difficult.

And on the distribution side, with the diesel going where it’s going maybe also downward pressure but I would not expect because some of the counter measures or the counter pressures we have is like shortages of equipment in certain parts of the world, like especially in the U.S.

But fundamentally, we have three factors, the inflation in the environment where we are, and we were referring last year to something around 3.8%, our pricing power and in 2014 compared with 2015, we finished [indiscernible] at plus 2.5%. And the cost measure that we can do and it’s the balance of the three.

And in the guidelines I gave, I was referring to higher pricing and ongoing cost savings like that it was set for inflation, leading to a further expansion in operating margin in 2014, so [indiscernible]. Now, I think we will go now with - we have lot of questions with the operator.

Hi, good afternoon, gentlemen, so just two questions actually for me. Firstly, could you say something about the outlook for margins in India and Indonesia this year?

And then secondly, just commenting again on guidance, how much cost cutting are you actually assuming in 2015?

So good afternoon, Paul. As for the margin in India, so we finish the year in EBITDA margin in Ambuja at 20.3%, you’re checking it, because said by memory.

You are right.

And I was referring to a bit less than 15%, exactly 14.8% in ACC, which where we are and we like to do process for both companies, the 20% margin, which is not a goal per se, because we believe it is a country, which would be much beyond the 25%, but we have to go back, so this is for India and Indonesia.

And Indonesia for 2015, with the new kiln coming on stream fully with full capabilities now and less or no virtually clinker import, we clearly also expect the margin expansion in 2015. I did not really go into the details in Indonesia.

As you know this is a public quota company and if I am not mistaken, then we’ll release the result on the 28th - on the February 27 - yes, 27.

And back to India, fundamentally the margin of ACC in Q4 was lower than expected, but I explained that we had discussed because we had at least two important mines that we didn’t operate because of this non-automatic renewal that this has been resulted in.

And then I think the last, the second part of your question was about cost cutting guidance, Paul?

Yes, exactly.

We have - we are trying to not give the guidance on costs. We have given the guidance on operating profit.

But we announced this, I think on November, when we had the Investor Day, and rest assured, we will then report, as we report quarterly result, we will then report obviously how much the cost impact are to savings effort from the Holcim leadership journey. But we try to turn it around, now we have given operating profit guidance and we will then in hindsight report what contributed how much to the performance quarter-by-quarter in 2015.

And, what we have reported already this year, that we’ll have of course impact next year - sorry, for 2014, that would have impact in 2015, that we continued to restructure in 2014. We mentioned CHF 72 million restructuring costs and this happened in Spain, in Belgium, in New Zealand, in Australia, even within Indonesia.

We continue with our Shared Service Center. Even in France we continued to address some restructuring costs.

Even in the U.S., we made a small restructuring to avoid the risk on the pension and that costs us CHF 6 million but that was good thing to do. So all things continue and on the fixed costs we were about to report flat fixed costs, because the only increase to our fixed costs base is 6%.

We have an inflationary environment that may go up to 3.8% and except restructuring and merger costs we were flat and a simple reason that we still are disciplined on fixed costs.

That’s great. If I can just have one quick follow-up on the India and Indonesia margin points, I mean, I understand you don’t want to give specifics this year.

But is it possible to give us some indication of what total cost inflation you all are expecting for India and Indonesia in 2015?

So I can refer to the cost we saw last year. Our production costs increased between 7.5% at ACC to 8% - and total Ambuja to 8% at ACC.

And distribution costs were up at between 5% and 5.7%, 5% is for Ambuja and 5.7% is for ACC. And I expect a bit of less pressure of the inflation now in this country.

As you know, we have also ahead of us pending request for approval of Foreign Investment Promotion Board to allow the two companies to work closer, and with the potential of CHF 150 million of efficiency in India by combining the two companies. So less inflation rate pressure than what I was giving to you in 2014.

So, now on Indonesia now with little bit of difficult case to make, I mean, you have as you know in certain parts of energy sector you have subsidies which are dropping off but our assumption is for general inflation in Indonesia will remain somewhere between 6% and 7%.

That’s great. Thank you very much.

Thank you.

Thank you. Next question.

Good afternoon, everyone. I’ve got three questions.

First sort of on the merger, I was interested to know, how the potential transfer of branding and products work, when you divest assets to CRH? I know you’ve got global branding but also product branding as well, and also presumably some specific proprietary stuff.

Will CRH needs to reintroduce its own brands and products or would have been licensed to produce some of these and does it vary by geography? Thanks.

Yes, also on - this is actually a very complicated question you’re asking here. And we are obviously - we do have a trend - a service agreement with CRH so going from Point A to Point B.

And in this service agreements, which is part of the two companies, which we are at the moment obviously not disclosing the details we are offering, things like IT services like where we have Shared Service Center environment like shared services to CRH. When it comes to branding and product branding, obviously this is - we are not going to disclose any details here.

This is something which not only we are negotiating or discussing between the parties - this is obviously also something, which is of interest to competition commission and I think that’s all I can say at the moment. Obviously, we are also - this is also a big question, not only for CRH and Holcim Lafarge, it is obviously also a very big question between Lafarge and Holcim, that the branding question, how we then will go ahead with product brand, you understand the company at a corporate brand, Lafarge Holcim, the whole strategy we’re then driving on a country-by-country basis on the product branding strategy.

But as we then have news, we will announce them, but so far we have nothing more to say to these subjects.

Okay.

[indiscernible] mention, but the philosophy for the divestment was to divest also the local specific brands, that are very specific in the country that, that the companies may have developed with a specific name and keep the global brands that are different meaning and different impact worldwide. That smallest philosophy you can expect.

Okay. And then just a second question from the outlook, a sort of more straightforward.

I think back at the of 2014, the Capital Markets Day, you talked about cement volume growth at 5% outside of China. I just wondered if that still - do you stand by that view, especially given your view of Europe.

And then also following up on that, where are the regions that you think will have a form in order to deliver that volume growth? Thanks.

So the 5% which we have announced at the Capital Markets Day was virtually the global cement growth outside of China. So this is not directly related, obviously in 2014 we have never given a forward looking information on exact cement volume growth consolidated.

So Bernard has given you the outlook on cement so we clearly expect positive growth in all regions with the exception of Europe and that I guess I will leave it there.

Okay. Thanks.

Thank you.

We have also in the Investor Day commented the footprint that is well oriented. Clearly, the U.S.

is the strong point. The growth was close to 8% this year.

This year projection is modest in the same area. UK, we don’t - or not in cement, but it’s a growing area for sure, Mexico is back.

If you remember, I was commenting how Mexico was going down one year ago, minus 9% on price, by minus 9% on volume. Now, if I take Mexico we can report plus 3.3% in the price, plus 3.9% in volume, so clearly, we have geared it, taking back and we’re just [ph] out.

Indonesia is growing. We grew last year and by something like 4% in volume so there is a momentum in the country.

Philippine is a growing area. I mentioned India, India, the expected growth was 5%, 6% plus in this area.

So clearly we see a better win in our footprint that what we can see when you are talking just one year ago.

Okay. Great.

Thank you very much.

Thank you.

Good afternoon, gentlemen. Just two quick ones for me, I’m wondering if you could talk, you’ve obviously had a very strong finish in the United States, you might just give some indication where utilization levels are now in the U.S.

in cement. And also interested to know where they will be in Canada today.

And likewise then in Europe, it’s the only market you haven’t guided up in terms of your cement volumes. So what are the markets that are potentially going to be down in 2015 in your view in Europe?

Thank you.

I will start with Europe, if you want, Thomas, and you will continue with the rest. In Europe, little bit more cautious, because in Europe you have France, and France, market was down last year by something like I think 6% roughly.

Holcim did a bit better in this environment with - because our colleagues of Holcim France were down by 1.6%, but we still expect the market to continue to be down in 2016 by roughly 2%, something like that. And also our definition of Europe includes Russia and in Russia last year, we reported globally recent development with volume growth of more than 5%, but we could clearly see in Q4 that Q4 was a bit weaker so we have decided to be cautious in the guidance in Europe.

The rest is more flattish, flattish minus, flattish plus according to the various countries.

So with respect to the U.S. capacity, cement capacity utilization last year was somewhere around 60% on Cement.

Now, on top of this we have actually mothballed, we have assets mothballed in the U.S., especially the second kiln in Midlothian, Texas which is still mothballed and which we have the plans now to take into operations during 2015. So we still have - so that’s cement.

We are not disclosing real clinker capacity utilization for obvious reasons. But I think what I’m telling you here, we still have significant capacity to grow into and that’s part of the success story when you look at the operational leverage, when you look at 2014 results in North America, obviously, most of the additional margin contribution comes from operational leverage and on top of this you have the positive pricing environment.

And this we expect to continue now in 2015. We had volume growth in the U.S.

of more than 13%. We expect somewhere around 8% in 2015 and then obviously also with strong pricing and then you have the, on top of this you have the operational leverage which kicks in and which continues in the U.S, so very positive environment, and again, enough capacity to grow into.

And that you can also link it with the guidance we gave on CapEx, where we said we are reducing it. Now we gave a guidance of - guidance plus expansion CapEx of CHF 1.5 billion, so we believe we have capacity to grow, we can extract more value from the asset, invest less and we can ultimately generate more cash flow and improve the return.

That’s the story we have there.

Okay. Thank you.

Next question.

Hi, good afternoon. Two questions, please.

One, I wanted to ask you about your merger-related costs. It appears that you have reshuffled some of the cost distribution and that bucket has increased since the time that we discussed it in Q3.

Could you just give us some more details around that? The guidance that you were giving us previously for 2015 was lower than what you’re guiding now and the overall for 2014 looks quite high.

The second question is very different. I wanted to ask you about your expectations for price development in the markets of Mexico and India.

Both markets are starting to move up, but the prices are not yet clear in terms of the direction and the magnitudes of the increase. Could you just give us your feeling as to what’s possible next year?

So, Thomas, for you the merger cost, CHF 77 million, CHF 130 million, CHF 150 million. Yes.

Okay. So with merger cost on the way, we are slightly higher in 2014 than the guidance we have given for 2014, that’s slightly higher but we have - there is obviously nothing reshuffled merger costs, the CHF 77 million included in the 2014 results are mainly costs in relation to regulatory processes, so a lot of legal costs to get regulatory approval.

That is a massive and a very heavy process. Other parts of these costs are obviously the bankers, investment banking.

We have the investment bank to support us in the transaction, in the merger, which you all know and then we have two banks, two investment banks which are and were supporting us in the divestment of the assets, so that’s obviously also as you can appreciate, costly. And then on top of this, one of the reasons why the merger costs now gradually are increasing has obviously to do with the merger, with the merger integration planning.

So as we come closer to the merger, today, one, as we call it obviously the planning activities are increasing, we have an entire team, between Lafarge and Holcim who are not working on divestments and merger clearance or whatever, they are working now diligently on preparing actually the merged company. And as we come closer today when these costs are increasing, that’s the main reason now why the merger related costs, the guidance we are giving for 2015, is significantly higher than for 2014.

Also the closure with the transactional CRH is obviously in 2015 and the details with the M&A banks were negotiated together with the closing in 2015 and therefore these costs will appear in 2015 only.

And as far Mexico, so I don’t give guidance on price, I’m not sure I am authorized to do. But - so I was mentioning that we finished 2013 with minus 9% on price, we finished 2014 with plus positive pricing and, in fact, we increased by more than 10% in the meantime because of there were the negative and then a positive.

And we believe that healthy positive pricing momentum should continue in Mexico. In India, it’s a bag market, so it depends where, but fundamentally it’s something that you manage on a weekly, if not daily basis in the 1,000 distribution centers with their own specificity.

But we saw price increase in rupees per bag last year. We started the year around INR 220 per bag, a bit more according to various places.

And we were in a position to continue to increase them in the beginning of the year but then it’s a daily and quarterly story. And once you have increased your price, you must make sure you don’t lose it in the distribution cost and the focus we have on the distribution cost.

And I believe the impact of DSL [ph], which is going down should help us in India. In the room, yes.

Christian Arnold, Bank Vontobel. Two questions from me.

On the one side, your guidance - 2015 guidance of operating profit of CHF 2.7 billion to CHF 2.9 billion, if I’m not mistaken, this has been unchanged, since last November. Last November, we somewhat expected a 5% tailwind from FX.

Now we have 5% headwind so to say. So that somewhat implies a guidance increase, so what makes you more confident than three months ago?

Maybe if you could - on that. And then secondly, on the timeline for the merger, I think it’s midyear you were targeting with the EGM taking place sometime in May or June, you still have to make the capital increase.

Could you give us a little bit more details about the timeframe here? Do we speak about June or do we speak about July or August or yes, - when it’s day one?

I will repeat you the day one story. And for the guidance it’s like-for-like guidance, and we make our business in different countries.

So it’s a pure translational effect that happens. And even in Switzerland, we also have some cash flows generated in Switzerland by the Swiss franc.

So ultimately, I’d say, maybe the head [ph] is slight [indiscernible] and so on, but you have constituency measures here. And what makes us confident that Q4 was the same quarter as you can see.

And of course you may have a stand-down if it rains or strong winter not strong winter come into place. We all know, and we’re cautious of that, but fundamentally we believe the footprint is well oriented with USA, with Mexico, with UK, with India, with Philippines, even Indonesia.

That is [indiscernible] and there is momentum to extract performance from the company and that’s the fundamental behind it.

Okay. So very important is what Bernard has said, the CHF 2.7 billion to CHF 2.9 billion is like-for-like, total devaluation of other currencies against the Swiss franc really we don’t play into the guidance.

So we will by comparing the guidance is actual results obviously we’re applying the 2014 exchange rate. So let me help you a little bit further.

In our annual report, we have a sensitivity analysis on page 148. That may also not help you much so I’ll give a little bit more information.

We just calculated the impact of the ForEx based on the February 20, exchange rate, the spot rate of the February 20. So if I take the spot rate from February 20, because what happened in mid-January is totally artificial and not going to help you much by using these rates.

But by applying the February 20, the operating profit for 2014 would have been negatively impacted by CHF 97 million or 4.2% despite of the net sales. Net sales would have been negatively impacted by CHF 918 million or 4.8% and if I take the last number, net financial debt, they would have decreased, which is a good thing, they would have decreased actually the most by CHF 586 million or 6.1%.

So I think what I want to tell you, the negative impact on SMB-division [ph], yes, obviously, if that persists that you’ll have the negative impact in the absolute numbers, that on return numbers, on the numbers balance sheet income statement it will have no impact, and if it has an impact, actually positive impact on net financial read [ph]. With respect to the second part of your question on the process, so the only thing which is really clear at the moment is the April 13, we will have our AGM.

And in this AGM we will obviously go through the normal AGM topics of Holcim Limited and Holcim consolidated results and whatever, what comes with it. And we may a second part of AGM, which will talk about merger-related topics.

Let me now not go into detail with our merger related topics. Obviously, the tender offer is merger related thing.

However, the share capital increase of Holcim Limited, were not going to be dealt with at that AGM, so that will be in April and what now means likely it will depend when we launch the tender offers. And then towards the end of tender offer period, we will have our EGM.

So at the moment we are looking at end of May, beginning of June, that’s the current timeframe. So if everything goes according to plan, end of May, beginning of June, that’s the current timeframe.

So if everything goes according to plan, end of May, beginning of June, we’ll have our EGM and the only subject on the agenda for that EGM will be the capital increase for Holcim in order to generate shares to exchange against the Lafarge. Is that clear?

Yes. Just an additional question, could we have the consolidation effect first of the integration of Cemex Wes?

Secondly, the deconsolidation of the Spanish assets, and also third, the consolidation of Czech Republic in terms of sales [indiscernible]

No, we said that EBITDA contribution for 2015, the additional EBITDA contribution of the entire transaction will be €10 million, I think it would be. We gave it in euros €10 million, we will not give you any additional details.

We will give you these details, as you know, the transaction close from the January 5, 2015, and we will obviously then have to give you all the details, we will have to give you all the details with the first quarter call.

And Jean-Christophe [ph] knows perfectly well that the impact is also the connection with Benelux footprint which are the strategic value for us. Yes.

A small add on the price volume variance per region in slide region, slide 36 and following on slide 38. The country which sticks out a little bit in Spain, so you mentioned that volumes have developed in the right direction, up around 10%, and on the other hand now we see prices down 10%, which is, seems like a very big divergence.

How do you explain that and how do you expect it to continue?

Yes. So you remember markets CHF 57 million tonnes and so seven - sometimes to remember those figures.

In Spain, we finished last year at CHF 10.9 million. So I think you told me it was 0.2% increase so it was sold in expensive stock, but [indiscernible] to be a bit positive number on the local market in the volume development.

And but also half of our business is now is now with exports and we must be careful, because it is impacted also by the pricing reduced for our ForEx activities. So, yes, it was a bit negative in pricing, as you can see in these documents, but the sentiment is still a positive, and they started the year end indeed on [indiscernible].

Okay. What we can read out of your statement, you said, if you look at this slide in a year, the figures should probably be model as a positive on the pricing.

I am a bit positive. I am careful with Spain now because since eight years, we have said that it’s a bit positive.

Okay, thanks.

Operator, I think we have other questions there.

Hello, hi, good afternoon everyone. Maybe three questions - three quick questions, if I may, first of all on the net debt in 2014, it was up CHF 200 million or so - sorry, a bit less.

You mentioned FX one of the main reason, working capital is down CHF 400 million. Could we have a little bit of more color on that deterioration there in working capital?

So that’s my first question. Second, I know we talked a lot about guidance.

Sorry to come back to that. But basically, you’re looking at an improvement in like-for-like of about CHF 400 million in your guidance.

And I think your like-for-like improvement in 2014 was CHF 200 million. Could you give us a little bit more color on how you would split that between volume, price and cost?

And maybe third question, if I may. In Europe, I was a bit surprised to see that your performance in France and Spain was a bit different from the ones we’ve observed at your peers.

Basically, you’ve had better volumes while pricing was decreased more - was worse. Is that a strategy of Holcim there?

Thanks.

So on the net working capital, clearly the most significant negative - sorry, the question was about networking capital, if I understood is right?

Yes.

Yes. The evolution of the debt.

So on the debt side, it’s very simple. I think I said it CHF 250 million increase due to currency and the single most significant contributor to that negative impact on currency is the U.S.

dollar. If you look at spot rates 2013 versus 2014 you have the main difference in this CHF 250 million.

You see the currency split of our net financial debt actually in the annual report. But there was a question if I understood it right on net working capital and the net working capital obviously we are impacted as well on currencies depending how they go.

And negative impact on net working capital end of 2014 was mainly the semi-finished and finished products development especially in the U.S. when as the market clears up.

And in the U.S. we have outages in the Northern Hemisphere.

Normally, our outages of the kiln taking place late in the year respectively very early in the year. The U.S.

most likely January, February, March, and so we really into have enough products in our silos in order to supply the market when our kilns are down. And so the single most negative contributor on net working capital in 2014 was semi-finished and finished products mainly in cement.

And as for France, you mentioned the cement, but you must have also the complete picture, if I take, for example, the aggregates activity, the price increased by almost 4% in 2014. And but lots of volume was in the area of 12%.

And then you have also the picture on ready-mix [ph], and so and so. So it’s an optimization or constant optimization and we are surprised [ph] before volume policy, which is the policy of Holcim, be it in France, be it in Spain.

And you should expect them to focus on extracting the best value from the assets with this mindset.

And if you like to ask, now I’ve found the page I was looking for, so if you want to have more flavor on the net working capital, receivables and other current assets contributed positively CHF 17 million. Inventories contributed a negative of CHF 133 million.

Operating liabilities contributed negatively CHF 60 million that has mainly to do how CapEx are spent. And if I spend less CapEx in December, obviously I have less payables as compared to a year before.

And I think these are the main contributors to the net working capital movement.

Thank you. Next question?

Hi there, I’ve got a few questions. Can you may be shed a little bit more light on the quarter four development in Latin America?

Obviously, top line was still, I would say subdued on average, but your profit is I think were up well double-digit on the like-for-like in EBITDA in Q4. And the question I suppose is do you think that is sustainable going in to 2015, or do you think it will slow down from here for whatever reason?

And then the second question is similarly on Europe, you sort of mentioned Russia, I believe Azerbaijan is also quite oil-related and may have some downside risk. Can you give us a sense as to how big those two places are within the European portfolio, just so we can assess the risk going into 2015?

And then finally on free cash flow, obviously, you’ve explained the working capital move just there. But obviously, your free cash flow was down significantly year-on-year.

And I appreciate you’re cutting CapEx I think year-on-year by something like CHF 200 million. Can we assume something on working capital?

I mean, just really want to get a sense where free cash flow heads going into 2015, because that was perhaps a little bit lower than I was looking for in 2014. Thank you.

Thank you. So in Q4 in LatAm, we had stronger development in Mexico and that I was mentioning, also less volume in Ecuador, I was also mentioning in my presentation.

But seems here whereby working on their cost, on their price we’re able to protect their margin, and even slightly improve it. And in a few weeks from now, where we start in Ecuador what we call Guayaquil 3 which is the new kiln, which will allow to substitute imports.

And here we have a strong engine to sustain a good performance, good cost performance in Latin America. That’s why we are a quite confident in what we can do in Latin America.

Now back to Europe, you mentioned two countries, Azerbaijan and Russia. In Azerbaijan, yes, there are less because there is some competition - local competition that happened.

We could also see that the government has started to restrict some imports that were coming from Iran. And we can see that the margin - the price remained stable and the margin has been protected.

So here we see, yes, less volume but relatively stable environment of profitability. Finally, remains the question of Russia, there it’s a bit of an unknown, what we think will happen here.

And for us, Russia is typically, under your control [ph], it’s a CHF 50 million EBITDA country, or CHF 53 million, if I remember well, the result of 2014. And we have good teams, good development skill and good activity in Moscow region, so but we want to be cautious by definition because we don’t know how the country will evaluate.

So it’s more cautioned than a fundamental concern today?

Thank you. On the free cash flow, so you saw the net working capital movements, obviously.

I tried to explain hopefully, you understood what I explained with respect to inventory levels. I do not expect inventory levels now for 2015 to change substantially.

I explained why we had the negative inventory movements so that doesn’t happen every year. So that is going to be a positive with respect to a net working capital [Technical Difficulty] to development.

We also announced this morning when we issued the result that on the portfolio side, we have identified Siam City Cement, our 27.5% stake in a Thai company as available for sale. So if I take all that into account I would clearly if we are going to be successful in divesting it, and I would under this clear assumption clearly expect a significant increase in free cash flow in 2015.

Thank you. And I just have a follow-up on the Siam City.

I was under the impression traditionally that Thailand is reasonably important with the sort of trade network within South East Asia. I guess, the question is, what has changed your view on that and how do you intend to sell it?

Because I don’t think you’ve been specific. Are you trying to sell this in the open market or strategic buyer, or you not - you haven’t concluded on that point yet?

Thailand is a good place to be, I think it’s a good country with the kind of mature also approach where you have earnings [ph] activity and the high grades of the Siam City Cement are well appreciated. Now we have a small share and we also can have different strategic approach on the country, with supply of the country, where we can play with different imbalance in the area.

And all-in-all, we believe that there may be some optimal value creation by other people owning this company and us following the other strategy. So it’s a good place, but it’s the strategic appreciation and this portfolio mobility is part of our policy.

If we want to improve the fundamental returns, we must have the capability to divest some places, to strengthen in other places. That was the philosophy of the swap with Cemex.

And we see no reason to stop this mobility, which is not massive but still can positively impact our results.

If I can add, you said that it was reasonably important to Holcim. It was actually very important to Holcim.

You also have to go back when we did the acquisition in Thailand that was virtually when we started the expansion in Asia. At that time, in 1998, that was an important piece to us after the Asian crisis.

And we used this very significant production facility to supply actually products across certain markets in Asia. Today, that has considerably changed, we have a very different footprint, a much larger footprint as Holcim in Asia.

We have already sold in 2012, the 9.3%, you may remember, in Indonesia, and it’s just a natural next step for us now to dispose of the 27.5%. And I’m sure you may appreciate that I’m not disclosing today, how we’re going to sell these shares.

I will disclose that to you after we have sold the shares. So I’m sure you understand this.

Absolutely. Thank you.

Thank you. We’ll take the last question at the operator and then the last question in the room.

Thank you very much letting me [indiscernible]. My two questions, please.

Firstly, looking at the bridge that you kindly provided, only CHF 22 million from volume, could I understand that a bit more, please, because it seems quite a low operating leverage with at least 1% cement volume growth, so why a bit lower than I might otherwise expect? And then just secondly, maybe you could give me a bit more of your view on Brazil, particularly for 2015.

I mean, last year, volumes were up but prices declining close to 5%. I mean do you see that pricing situation particularly worsening significantly in 2015 in Brazil?

Thanks.

So I will start with Brazil, and maybe you continue, Thomas, with the bridge. So in Brazil, we reported for a bit of more volume 3.6%, a kind of deterioration of the price by 4.8%, with a bit of competitive pressure with new plants starting in some of our footprint.

But we believe that we should still have a bit of positive volume development in 2014 and the price should stabilize. But even if this is a bit more positive story, it’s not the Brazil we would like to see, because there is so much potential there.

And now, the country runs positively but not strong enough to material all its potential. So we remain confident and we expect a slight increase, but not a massive change in the performance in 2015.

Thomas?

Right. With respect to the volume question on the CHF 22 million, obviously, Mike, this is not just cement, this is a mixed number from all our different businesses.

So we were down in aggregates, 0.4%, and then a significant 5% down in ready-mix, and obviously it’s purely the net volume impact. The operational leverage you see then when you move to the right, that fixed costs virtually have remained stable, and that’s where the operational leverage then kicks in.

But the CHF 22 million is the net number of the different segments. I have the number - the details of the segments not with me, but I will be happy to share that with you as well.

That would be great. Thank you.

Thank you. And, Mike, as a symbol of operational leverage is the syngen [ph].

Last year, we were reporting $28 cash costs, now we’re at $27.4, and we still have capacity to supply the U.S. market.

Thank you.

Thank you.

Thank you.

Last question in the room.

Yes, Patrick Appenzeller, Helvea Baader. Just to clarify your answer to the questions on the impact from the currencies.

You mentioned, I think, CHF 97 million, the impact on the operating profit if you take current spot rates. Now, if I’m going to your sensitivity analysis there, you mentioned it on Page 148, I see there is an impact of CHF 3 million only from the euro, on a 5% range [ph], now we have 10% of this.

There is much more on the other currencies, but if I look towards number one, this is on the U.S. dollar, it’s now higher than the average [indiscernible].

Also of some other currencies have recovered, so still down probably most of them - some of them but how do you come to CHF 97 million? That seems a high number.

Okay. So let me try to explain.

Apparently, you don’t believe them.

Short explanation, because you all got to be…

Very short explanation in a very complex environment, what you’re comparing with when you talk about the CHF 3 million in the sensitivity table, that’s euro, euro only. The numbers I have given you are the entire foreign currency for the entire Holcim basket.

So these currencies obviously have these differences, number one. Number two, in euro we’re not only having profitable companies, we are having companies with negative operating profit.

And obviously the negative operating profit reacts positively with these currency movements, contrary to the United States. In the United States, we are really getting a significantly higher profitability in the euro currency alone.

And that virtually explains it. Think about it in Europe, a large contributor to profit is now the UK, obviously not in euro environment.

So that’s we can maybe discuss it a little bit further but let’s [indiscernible].

Well, I leave it you further discussion and be sure that whenever the negative operating profit protection and we believe that you can turn Europe into a good story, which I think is what happened in the past few years. With this I thank you very much for your interest in Holcim.

Our Investor Relations teams and communication team are now set to remain at your disposal, if you any questions. Thank you.

Wish you a nice day.

Thank you.