TIDMCOD
RNS Number : 7742C
Compagnie de Saint-Gobain
24 February 2022
The worldwide leader
in light & sustainable construction
2021 Annual Results
Record growth, earnings and margin
-- Record organic growth up 18.4% on 2020 and 13.8% on 2019 :
outperformance (volumes up 6.2% on 2019) on very dynamic underlying
markets and with an acceleration in prices (up 10.3% in Q4),
generating a positive price-cost spread of EUR60 million in
2021
-- Record operating income and margin: up 60% on 2020 and 39% on
2019(1) at EUR4,507 million ; margin at 10.2% (a rise of 250 bps
over the three years of transformation)
-- Record recurring net income of EUR2,815 million, up 91% on 2020 and 47% on 2019
-- Free cash flow up 56% on 2019 at EUR2,904 million , with a conversion ratio of 53%
-- Strong value creation , with ROCE at a record high of 15.3% (versus 11.1% in 2019)
-- Record shareholder return at EUR1.2 billion in 2021 through
share buybacks and dividends; TSR(2) at 69% for the year. Dividend
of EUR1.63 (up 23%) recommended for 2021, and commitment to buy
back at least EUR400 million in shares in 2022
-- Continued progress in sustainability performance , with a
further reduction in scope 1 and 2 CO(2) emissions in 2021 despite
the sharp 11.7% year-on-year increase in volumes, representing a
reduction of 23% on 2017
-- Successful launch of the "Grow & Impact" plan , with
first-year results in line with or ahead of all objectives
New growth and profitability profile confirmed
2022: another year of growth in operating income
at constant exchange rates
1. Like-for-like.
2. TSR: Total Shareholder Return for Saint-Gobain in 2021,
including the reinvestment of the dividend in Saint-Gobain
stock.
Benoit Bazin, Chief Executive Officer of Saint-Gobain,
commented:
"Thanks to our extremely committed teams, the Group has
demonstrated the full benefits of its profound transformation and
proven its ability to structurally accelerate its profitable growth
on markets which look especially well-oriented over the long term.
As the worldwide leader in light and sustainable construction,
Saint-Gobain plays a key role in the fight against climate
change. Our teams work relentlessly to maximize our positive
impact by offering our customers a comprehensive and unbeatable
range of sustainable solutions, representing 72% of Group
sales.
The records achieved in 2021 confirm that the Group has entered
a new post-transformation trajectory in terms of performance:
market-beating sales growth, record earnings and margin, a high
level of free cash flow generation that has more than doubled
compared to previous years, and strong value creation for our
shareholders thanks to strict capital allocation and the determined
execution of our portfolio optimization. With EUR2 billion in sales
divested in 2021 and EUR5.6 billion since end-2018, as well as
almost EUR2 billion in sales acquired or in the process of being
acquired in 2021 (mainly Chryso and GCP Applied Technologies),
Saint-Gobain has continued its strongly value-creating strategy and
has established itself as a major global player in high-growth
segments such as construction chemicals. This performance was
accompanied by major progress against our sustainability
commitments, notably with the continuing reduction in our carbon
emissions.
Building on this profound and lasting cultural and financial
transformation, Saint-Gobain goes into 2022 with the confidence to
continue the momentum generated by its "Grow & Impact" plan.
Against a backdrop of structurally supportive markets, Saint-Gobain
is targeting a further increase in operating income in 2022 versus
2021 at constant exchange rates."
2021-2025 "Grow & Impact" plan: successful execution of the 1(st) year
Sustainable construction and industry decarbonization are
essential in the fight against climate change. As the worldwide
leader in light and sustainable construction, Saint-Gobain
therefore plays a key role in reaching carbon neutrality.
The first year of the "Grow & Impact" plan has already
proved a success , and sets the Group firmly on the financial
trajectory set at its Capital Markets Day , with an acceleration in
earnings and cash generation, along with attractive value creation
for our shareholders:
- Strong organic growth with an annual average of 6.9% over the
period 2019-2021, ahead of the 3%-5% target, maximizing
Saint-Gobain's positive impact in the fight against climate change
. Its comprehensive range of sustainability solutions for its
customers represents 72% of Group sales. The solutions sold by
Saint-Gobain across the globe in one year result in around 1,300
million tons of avoided CO(2) emissions over their lifespan, i.e.,
around 40 times the Group's own total carbon footprint in 2020
(scopes 1, 2 and 3), and more than 100 times its scope 1 and 2
footprint;
- Operating margin of 10.2%, in line with the Group's
double-digit margin ambition ;
- Free cash flow conversion ratio of 53% , in line with the
objective of over 50%, with free cash flow generation that has more
than doubled since the launch of the transformation at the end of
2018, at EUR2.9 billion;
- Strong value creation, with ROCE at 15.3% - ahead of the
target of 12%-15% - compared to 10.4% in 2020 and 11.1% in
2019;
- Record shareholder return at EUR1.2 billion.
Operating performance
Like-for-like sales were up 18.4% on 2020 and 13.8% on 2019 ,
with the increase accelerating to 15.9% in the second half versus
second-half 2019 .
In a far more inflationary raw material and energy cost
environment, the Group once again showed its ability to increase
sales prices and generate a positive price-cost spread in 2021. The
price effect was a positive 6.7% for 2021 as a whole, steadily
increasing throughout the year to stand at 9.5% in the second half
and 10.3% in the fourth quarter.
In line with the third quarter, and as expected, there was a
modest rise in volumes , up 0.6% over the second half given the
very high comparison basis in 2020, when trade professionals in
Europe had taken less holiday during the summer and over the
Christmas and New Year period owing to the coronavirus pandemic.
Compared to second-half 2019, volumes were up by 4.9%, with an
acceleration between the third and fourth quarters (up 3.6% and
6.0%, respectively) in all Group segments.
On a reported basis , sales came in at a record high of
EUR44,160 million , with a negative currency effect of 0.4% over
the year, but a positive effect of 1.7% in the second half, due
mainly to the appreciation of the British pound, Nordic krona and
the US dollar in the fourth quarter alone.
The Group structure impact reduced sales by 2.2% over the year
and by 3.6% in the second half, reflecting the ongoing optimization
of the Group's profile , with EUR 5.6 billion in total sales
divested or signed to date since the launch of the transformation
at the end of 2018. In 2021 alone, Saint-Gobain completed or signed
20 divestments representing EUR2.0 billion in sales, including
mainly Lapeyre in France, Distribution in the Netherlands and
Spain, specialized Distribution in the UK, Glassolutions in Germany
and Denmark, and Pipe in China.
During the year the Group completed or signed 37 acquisitions
representing almost EUR2.0 billion in sales , including mainly
Chryso and GCP Applied Technologies (GCP) - reinforcing its
existing positions to make it a major global player in construction
chemicals with more than EUR4 billion in sales - and Panofrance, a
specialist distributor of timber and panels. The integration of
Chryso is progressing particularly well and the company is
consolidated in the Group's financial statements as from
fourth-quarter 2021, with objectives set at the date of the
acquisition exceeded in 2021 in terms of both sales (EUR431
million, up 26% like-for-like on 2019) and EBITDA (EUR87 million).
Continental Building Products (plasterboard in the US), acquired in
February 2020, created value in the second year - one year earlier
than targeted - thanks to a strong operating performance and a
rapid and seamless integration: sales totaled USD 605 million in
2021, with EBITDA at USD 185 million, representing an EBITDA margin
of 30.6% , and synergies exceeded initial expectations, at an
annualized rate of USD 50 million.
Note that in light of the hyperinflationary environment in
Argentina, this country which represents less than 1% of the
Group's consolidated sales, is excluded from the like-for-like
analysis.
Operating income rose sharply, reaching a new all-time high of
EUR4,507 million , a rise of 58% on a reported basis versus 2020
and of 33% versus 2019. Operating income was up by 60% and 39%,
respectively, on a like-for-like basis.
Saint-Gobain's operating margin rose to a record level of 10.2%
in 2021 (from 7.5% in 2020 and 8.0% in 2019), i.e., an increase of
250 basis points since the launch of the Group's transformation at
the end of 2018 and at the level of the best sector performers in
both industry and merchanting.
In 2021, the Group benefited from:
- A structurally improved post-pandemic volume dynamic,
supported by market share gains, leveraging its comprehensive range
of solutions developed within the scope of a multi-local
organization, with strongly empowered local management as close to
customers as possible;
- Good trends in sales prices, generating a positive raw
material and energy price-cost spread of EUR60 million;
- An optimized profile and portfolio delivering a structural
improvement in its profitable growth with a positive impact on the
operating margin;
- EUR150 million in cost savings resulting from the
post-coronavirus adaptation measures launched in 2020, along with
the rigorous execution of our ongoing operational excellence
program.
Segment performance (like-for-like sales)
Northern Europe: strong sales momentum on the renovation market
and record margin
Sales in the Northern Europe Region were up by 15.5%
year-on-year and by 12.1% on 2019, with a stronger 14.9% increase
in the second half of the year versus second-half 2019 thanks to a
good fourth quarter on structurally supportive renovation markets.
The Region's operating margin hit an annual record high of 7.3%
(versus 6.2% in 2020 and 6.3% in 2019), supported by good volume
trends, an optimized business profile and a strong acceleration in
prices at the end of the year.
Nordic countries reported robust growth over the year as a
whole, particularly in sales through distribution and light
construction solutions, on a supportive renovation market. Our
e-commerce platforms proved especially dynamic, representing up to
30% of sales in specialty segments. Investments in Norway aimed at
transforming our Fredrikstad factory into the world's first
carbon-neutral plasterboard plant made good progress. Despite the
impact of the automotive market contraction on demand for glass,
Germany ended the year with an acceleration thanks to sales of
light and sustainable construction solutions and should benefit
from stimulus measures in the energy efficiency renovation segment
in 2022. The UK saw an acceleration in growth in the second half
compared to second-half 2019 - in the context of an optimized
network - driven by prices and an improvement in sales through
distribution, despite certain logistical difficulties affecting
supply chains. Eastern Europe enjoyed strong growth in its main
markets, particularly Poland, the Czech Republic and Russia,
although the latter represents only around 0.5% of the Group's
sales.
Southern Europe - Middle East & Africa: strong sales
momentum on the renovation market and record margin
Sales for the Southern Europe - Middle East & Africa Region
rose by 20.3% year-on-year - with all countries reporting
double-digit growth - and by 13.9% compared to 2019, with an
acceleration to 14.9% in the second half versus second-half 2019
thanks to a good fourth quarter on structurally supportive
renovation markets. The operating margin for the Region came in at
an annual record high of 8.3% (versus 5.2% in 2020 and 5.4% in
2019) owing to several factors: very good volumes and an
outperformance on the renovation market and in sustainable
construction solutions, productivity gains from our teams, a highly
optimized post-transformation profile following in particular the
positive impact of disposals, and a strong acceleration in prices
at the end of the year.
France continues to enjoy good momentum, driven by renovation
markets and energy efficiency solutions. The Group has benefited
from France's household stimulus package MaPrimeRenov', which
represents EUR2 billion in subsidies distributed for over 600,000
projects approved over the year. In terms of renovation of public
buildings, the first effects of the stimulus plan should begin to
be seen in 2022. Saint-Gobain continued to capture market share
during the year in France. It benefited from its unique and dense
presence across the entire value chain: from the manufacture of
sustainable solutions to their distribution - in stores offering
advice, training, digital services, and logistics or recycling
solutions to our hundreds of thousands of trade professional
customers, as well as on e-commerce platforms or our site offering
inspiration and intermediation, La Maison Saint-Gobain. The
acquisition of Panofrance enriches the Group's offer in the
high-potential modular timber solutions market. Spain advanced,
particularly in light construction solutions as well as in
construction chemicals, and despite the closure of a flat glass
manufacturing plant in 2020 as part of the optimization of our
industrial footprint. To support this robust growth, a new
plasterboard facility equipped with the very latest technologies
will be operational in the country in 2022 at Quinto. Italy
leveraged the Group's comprehensive solutions offering to fully
benefit from the country's continued support for energy-efficient
renovation in the form of tax credits. Benelux also progressed, as
did the Middle East and Africa , where we opened 5 plants
increasing our presence to 21 countries in 2021, with strong growth
in Turkey and Egypt.
Americas: strong sales growth and increase in margin to an
all-time high
The Americas Region delivered 22.3% organic growth over the year
compared to 2020, and 28.3% compared to 2019, with an acceleration
in the second half at 31.3% versus second-half 2019 thanks to good
momentum in the fourth quarter. The operating margin for the Region
came in at an annual record high of 16.5% (versus 11.5% in 2020 and
10.1% in 2019), mainly supported by strong growth in volumes and a
strong positive raw material and energy price-cost spread.
- North America progressed by 21.6% over the year versus 2019,
and by 23.5% in the second half of 2021, driven by an acceleration
in prices and a good volume dynamic in light construction
solutions. Our local organization enabled us to mitigate strong
tensions on supply chains throughout the year - particularly for
raw materials - and to strengthen our customer relationships. The
successful integration of Continental in early 2020 not only helped
strengthen the Group's position on the US plasterboard market, but
also helped develop a shared Saint-Gobain solutions offer for new
sales channels, thereby improving our value proposition and
differentiation for our customers thanks to these sales
synergies.
- Latin America achieved further strong growth in terms of both
prices - to offset inflation - and volumes. Sales in the Region
grew by 42.5% over the year compared to 2019, and by 47.7% in the
second half driven by the acceleration in prices. Brazil benefited
from its comprehensive range of solutions in 2021, strengthening
its market presence and improving its efficiency and customer
service. Growth was also supported by our development in Argentina,
Chile, Peru, Mexico and Columbia, thanks to new plant openings and
acquisitions to reinforce our presence in the region.
Asia-Pacific: strong sales growth and record margin
The Asia-Pacific Region reported 28.5% growth versus 2020 and
17.0% growth versus 2019, including 17.8% in the second half versus
second-half 2019. The operating margin for 2021 came in at an
annual record high of 11.8% (versus 10.7% in 2020 and 10.6% in
2019), supported by good momentum in volumes.
India delivered a strong performance in 2021, despite an
unstable health situation throughout the year. The Group captured
market share in the country, thanks to its leadership in promoting
energy- and resource-efficient buildings, an integrated and
innovative range of solutions for the residential market (Home
& Hospitality), and the introduction of new ranges of
construction chemicals. The integration of Rockwool India in stone
wool insulation, expected to be completed by the end of
first-quarter 2022, will help continue this overall dynamic. China
enjoyed very strong growth in 2021, benefiting from market share
gains thanks to its positioning on high value-added segments, in an
upbeat market. Several development projects will help accelerate
growth in light and sustainable construction, including new gypsum
lines and waterproofing solutions. Although South-East Asia
returned to growth overall at the end of the year compared to 2019,
driven by Vietnam where the Group continued to capture market
share, its 2021 performance was affected by the numerous health
restrictions imposed in light of the coronavirus pandemic.
High Performance Solutions (HPS): good growth in sales versus
2019 excluding Mobility
HPS sales were up by 14.5% year-on-year and by 3.3% compared to
2019, with a stronger 4.6% increase in the second half versus
second-half 2019 thanks to upbeat industrial markets in the fourth
quarter, with the exception of automotive in Europe. Against this
backdrop, the operating margin came in at 12.4% for the year
(versus 9.4% in 2020 and 12.7% in 2019), continuing to be affected
by Mobility in Europe.
- Businesses serving the Construction Industry outperformed the
market with 11.8% growth versus 2019, continuing to benefit from
upbeat trends in textile solutions for external thermal insulation
systems (ETICS) thanks to good momentum in sustainable
construction. This growth was supported by the increase in
production capacities for textile solutions. The integration of
Chryso got off to a very good start: the company is consolidated as
from fourth-quarter 2021 and sales trends are very positive, ahead
of the expectations set at the time of the acquisition.
- The Mobility business remained slightly below 2019 levels
(down 3.1%), but returned to growth in the fourth quarter (up 1.7%)
driven by a progression in sales to the Americas and China,
particularly in electric vehicles, which now represent around 20%
of our automotive sales. Europe remained down, as the shortage of
semi-conductors weighed on automotive manufacturers' production
capacities. However, thanks to its very strong positioning in
electric vehicles and high value-added products, the Mobility
business continued to significantly outperform the automotive
market.
- B usinesses serving Industry progressed 6.4% on 2019,
supported by positive trends in surface finishing solutions and
innovation in decarbonization technologies for our customers, such
as Saint-Gobain's expertise in specialty materials that help
significantly reduce CO(2) emissions from many different industrial
processes and applications (e.g., ceramic refractories for glass
manufacturers). Although the year-on-year rebound in activities
relating to investment cycles intensified throughout the year,
these activities remain slightly down on 2019.
Analysis of the 2021 consolidated financial statements
The 2021 consolidated financial statements were approved and
adopted by Saint-Gobain's Board of Directors at its meeting of
February 24, 2022. The consolidated financial statements were
audited and certified by the statutory auditors.
2019 2020 2021 % change
------- ------- ------- ----------------------
in EUR million 2021/2019 2021/2020
------- ------- ------- ---------- ----------
Sales 42,573 38,128 44,160 3.7% 15.8%
Operating income 3,390 2,855 4,507 32.9% 57.9%
Operating depreciation and amortization 1,901 1,902 1,934 1.7% 1.7%
Non-operating costs -421 -342 -239 43.2% 30.1%
EBITDA 4,870 4,415 6,202 27.4% 40.5%
Capital gains and losses on disposals,
asset write-downs and impact of
changes in Group structure -416 -1,081 -332 20.2% 69.3%
Business income 2,553 1,432 3,936 54.2% 174.9%
Net financial expense -496 -453 -408 17.7% 9.9%
Dividends received from investments 28 34 1 n.s. n.s.
Income tax -631 -526 -919 -45.6% -74.7%
Share in net income of associates 0 2 4 n.s. n.s.
Net income before non-controlling
interests 1,454 489 2,614 79.8% 434.6%
Non-controlling interests 48 33 93 93.8% 181.8%
Net attributable income 1,406 456 2,521 79.3% 452.9%
Earnings per share(2) (in EUR) 2.59 0.85 4.79 84.9% 463.5%
Recurring net income(1) 1,915 1,470 2,815 47.0% 91.5%
Recurring(1) earnings per share(2)
(in EUR) 3.53 2.74 5.35 51.6% 95.3%
EBITDA 4,870 4,415 6,202 27.4% 40.5%
Depreciation of right-of-use assets -682 -675 -679 0.4% -0.6%
Net financial expense -496 -453 -408 17.7% 9.9%
Income tax -631 -526 -919 -45.6% -74.7%
Capital expenditure(3) -1,818 -1,236 -1,591 -12.5% 28.7%
o/w additional capacity investments 536 371 516 -3.7% 39.1%
Changes in working capital requirement 78 1,148 -217 -378.2% -118.9%
Free cash flow(4) 1,857 3,044 2,904 56.4% -4.6%
Free cash flow conversion(5) 44% 81% 53%
ROCE 11.1% 10.4% 15.3%
Lease investments 955 833 769 -19.5% -7.7%
Investments in securities net
of debt acquired(6) 304 1,423 1,352 344.7% -5.0%
Divestments 1,052 2,567 322 -69.4% -87.5%
Consolidated net debt 10,491 7,181 7,287 -30.5% 1.5%
----------------------------------------- ------- ------- ---------- ----------
1. Recurring net income = net attributable income excluding
capital gains and losses on disposals, asset write-downs and
material non-recurring provisions.
2. Calculated based on the weighted average number of shares
outstanding (526,244,506 shares in 2021, versus 536,452,195 shares
in 2020).
3. Capital expenditure = investments in tangible and intangible assets.
4. Free cash flow = EBITDA less depreciation of right-of-use
assets, plus net financial expense, plus income tax, less capital
expenditure excluding additional capacity investments, plus change
in working capital requirement.
5. Free cash flow conversion ratio = free cash flow divided by
EBITDA, less depreciation of right-of-use assets.
6. Investments in securities net of debt acquired: EUR1,352
million in 2021, of which EUR1,319 million in controlled
companies.
EBITDA climbed 40% on 2020 and 27% on 2019 to a record EUR6,202
million, while the EBITDA margin came in at a record annual high of
14.0% versus 11.6% in 2020. Non-operating costs included in EBITDA
decreased to EUR239 million from EUR342 million in 2020, in line
with the objective given at the Group's Capital Markets Day.
The net balance of capital gains and losses on disposals, asset
write-downs and the impacts of changes in Group structure
represented an expense of EUR332 million (versus an expense of
EUR1,081 million in 2020), reflecting EUR265 million in asset
write-downs relating mainly to the divestment of underperforming
businesses, and EUR67 million in disposal losses and impacts
relating to changes in Group structure. Business income was
EUR3,936 million, up 54% on 2019.
Net financial expense excluding dividends from investments
improved, at EUR408 million versus EUR453 million in 2020.
The tax rate on recurring net income was 24%, slightly lower
than in 2019 (25%). Income tax was EUR919 million, including an
exceptional EUR106 million which relates to deferred tax in the UK
(liability method) following the rise in the corporate income tax
rate from 19% to 25%.
Recurring net income hit an all-time high of EUR2,815 million
(excluding capital gains and losses on disposals, asset write-downs
and material non-recurring provisions), up 47% from EUR1,915
million in 2019.
Net attributable income amounted to EUR2,521 million, up 79% on
the 2019 figure of EUR1,406 million.
Capital expenditure represented EUR1,591 million, up on the
abnormally low figure in 2020 but down 12.5% on 2019. In 2021,
growth capex was up by 40% on 2020: the Group opened 21 new plants
and production lines to bolster its leading positions on the
fast-growing markets of construction chemicals and light
construction. Its main growth projects concerned (i) sustainable
construction and construction chemicals in Asia (Malaysia and
China), Latin America (Brazil, Peru and Chile), Africa (Ivory Coast
and Angola), the Middle East (Saudi Arabia), Europe (Czech
Republic) and Turkey, and (ii) façade and light construction
solutions in emerging countries (Mexico, India and China), in the
United States and in Spain. In North America, Saint-Gobain has
decided to invest more than USD 400 million over the next three
years to increase its production capacities in plasterboard,
roofing and insulation.
Free cash flow remained high, at EUR2,904 million , a rise of
56% on 2019. The free cash flow conversion ratio was 53% versus 44%
in 2019, buoyed by strong growth in EBITDA, a continuing low
working capital requirement (WCR) and the decrease in maintenance
capex. Operating WCR represented 17 days' sales at December 31,
2021, representing a historic low for the second consecutive year
(compared to 18 days at end-2020 and 27 days at end-2019), thanks
to efforts to monitor overdue receivables and despite the first
steps taken to rebuild inventories in order to best serve its
customers .
ROCE hit an all-time high of 15.3% (versus 11.1% in 2019),
resulting in strong value creation for our shareholders, in both
industry and merchanting.
Investments in securities net of debt acquired totaled EUR1,352
million (EUR1,423 million in 2020), and related primarily to the
acquisition of Chryso in the construction chemicals segment - but
also Duraziv in Romania and Z Aditivos in Peru - the bolt-on
acquisitions of Panofrance and Raboni Normandie in France;
Brüggemann in modular construction in Germany; and a joint venture
investment in Massfix, a glass recycling company, to develop the
circular economy in Brazil. In total, acquisitions made by the
Group in 2021 represent approximately EUR820 million in full-year
sales and approximately EUR125 million in EBITDA.
Divestments totaled EUR322 million, corresponding essentially to
the sale of Lapeyre, the distribution business in the Netherlands
and Spain, the specialized plumbing, heating and sanitaryware
distribution business in the UK (Graham), and the Pipe business in
China.
Net debt remained virtually stable at EUR7.3 billion at December
31, 2021 (EUR7.2 billion at end-2020 and EUR10.5 billion at
end-2019). It benefited from strong free cash flow generation which
allowed us to enhance our capital allocation and shareholder return
policy (EUR1.2 billion distributed via dividend payouts and the
buyback of almost 9 million Saint-Gobain shares). The Group was
therefore able to invest EUR1.6 billion in capital expenditure and
EUR1.4 billion in acquisitions. Net debt represents 35% of
consolidated equity compared to 39% at December 31, 2020. The net
debt to EBITDA ratio on a rolling 12-month basis was 1.2 (around
1.5 with the GCP acquisition on a pro forma basis) compared to 1.6
at December 31, 2020.
Environmental, Social, Governance (ESG) performance
Thanks to its positive-impact solutions, Saint-Gobain plays a
key role in building a carbon-neutral economy. The Group continued
to make significant progress in environmental and social matters in
2021, allowing it to reduce its footprint while maximizing its
positive impact, in line with its "Grow & Impact" strategy and
thanks to the strong commitment of its employees. Around 60,000
Group employees are Saint-Gobain shareholders, in 48 countries. In
the 2021 survey, employees showed their strong belief in the
Group's vision and strategy, with an impressive industry-leading
engagement rate up 4 points in 2 years at 83%, confirming the
pride, loyalty and satisfaction of our teams (82% in 2020, 79% in
2019).
Reduce the Group's environmental footprint:
In 2021 , the Group scored 66 on the new composite
sustainability index - defined in October 2021 - compared to 50 in
2017 , and is therefore already one-third of the way towards
meeting its 2030 goal of 100. This illustrates our combined efforts
to reduce carbon emissions (scopes 1 and 2), water withdrawal and
non-recovered waste, and to increase avoided virgin raw materials
by incorporating recycled materials into our products.
Maximize the Group's positive impact:
The comprehensive range of sustainable solutions for its
customers represents 72% of Saint-Gobain's sales: our solutions
enable CO(2) emissions to be reduced during their use, favor the
circular economy, the preservation of natural resources, and the
well-being of the population at large (health and safety; acoustic,
thermal and visual comfort; air quality; ergonomics, etc.).
The solutions sold by Saint-Gobain across the globe in one year
result in around 1,300 million tons of avoided CO(2) emissions over
their lifespan, i.e., around 40 times the Group's own total carbon
footprint in 2020 (scopes 1, 2 and 3), and more than 100 times its
scope 1 and 2 footprint.
Significant ESG progress in 2021:
- Climate change and the circular economy: act to reduce our
carbon footprint thanks to our 2030 roadmap towards carbon
neutrality by 2050. There was a further reduction in scope 1 and 2
CO(2) emissions in 2021, down to 10.3 million tons - despite the
sharp 11.7% year-on-year increase in volumes - representing a
reduction of 23% since 2017, in line with the 2030 objective of a
33% reduction, as validated by the Science-Based Targets initiative
(SBTi).
-- Growth decoupled from its CO(2) emissions : 0.23kg of CO(2)
per euro of sales, representing a reduction of around 15% on 2020
and of almost 30% on 2017; 1.67kg of CO(2) per euro of EBITDA,
representing a reduction of approximately 30% on 2020 and of more
than 50% on 2017;
-- Increase in the proportion of ESG-linked compensation : from
5% to 10% for short-term compensation (CO(2) emissions reduction
criterion added to the safety criterion), and from 15% to 20% for
long-term compensation (increase in the weighting of the CO(2)
emissions reduction criterion from 5% to 10%, along with criteria
based on safety and diversity, each accounting for 5%);
-- Two-fold increase over one year in green electricity as a
proportion of the Group's total electricity consumption, at nearly
40%, in line with targets;
-- Capital expenditure and R&D investments focused on the
2050 net zero carbon goal: around EUR100 million allocated for the
reduction of direct emissions as from the first year of the EUR1
billion package covering 2021 to 2030;
-- The Group has increased its internal carbon prices - in place
since 2016 - from EUR50 to EUR75 per ton for investment decisions
and to EUR150 per ton for research and development investments in
disruptive technologies;
-- Increase in avoided virgin raw materials : from 9.3 million
tons in 2020 to 9.9 million tons in 2021;
-- Reduction of 24% in non-recovered waste since 2017.
- Health, safety and diversity: care for employees and increase
the gender balance in senior management at local and Group level .
Women represent 38% of the Group Executive Committee in place since
July 1, 2021, ahead of the target of 30% in all internal senior
management teams by 2025.
-- Diversity : women represent almost 35% of new management
hires in 2021. The objective of more than 25% of women managers was
reached in 2020 and the proportion continues to rise, with 26.3% of
women managers in 2021 (25.3% in 2020). A new target of 30% of
women managers in 2025 has been set;
-- Continued commitment to safety , with the accident frequency
rate (TRAR(1) ) including subcontractors at 1.9 in 2021, an
improvement of 15% versus 2019;
-- New healthcare policy involving all stakeholders: protecting
and promoting the health and well-being of our employees,
customers, suppliers, users of our products and solutions and local
communities is the ambition of Saint-Gobain's new healthcare
policy.
- Inclusive growth and business ethics : on June 17, 2021, more
than 2,300 sites organized workshops and debates as part of the
International Principles of Conduct and Action Day. Employees
expressed their commitment to ethical values and to the Group's
purpose of "Making the world a better home".
-- Responsible purchasing : reduce the impact of freight by
developing river transport, as for example in France in the Paris
region to limit heavy goods traffic in urban areas. In Belgium as
from June 2021, Saint-Gobain also joined forces with local partners
to develop the recovery of used plasterboard and transportation of
the materials by river to Saint-Gobain sites for recycling. Each
loaded vessel can transport 400 tons of plasterboard, i.e., the
equivalent of around 16 24-ton trucks, and can therefore replace a
large proportion of container transport by road;
1. TRAR (Total Recordable Accident Rate): accident frequency
rate with and without lost time (employees, temporary staff and
on-site subcontractors).
-- Inclusive growth : almost EUR15 million for community
initiatives (philanthropy and sponsorship); promote youth training
in building (or construction) trades, such as in Morocco with the
creation of three training centers which provide a broad spectrum
of courses leading to qualifications. Saint-Gobain in Morocco aims
to build a local incubator for skilled labor to implement more
sustainable solutions;
-- Shared business ethics : 95% of managers trained in our Code
of Ethics in their first year with the Group; 2021 also saw the
roll-out of a whistleblowing system accessible to employees and
other stakeholders.
Our progress is recognized by independent organizations:
- CDP 2021 "A List" : among only 200 A-rated companies worldwide
(12,000 companies rated by CDP);
- Bloomberg 2022 Gender-Equality Index : among 418 companies
recognized worldwide for the third year running;
- 2021 Global Top Employer : among only 11 companies recognized
worldwide; local Top Employer award in 38 countries, covering 92%
of employees.
To access sustainability reports, detailed results, key figures
and significant events concerning the Group, please click here:
https://www.saint-gobain.com/en/corporate-responsibility
Shareholder return policy
In 2021 , Saint-Gobain returned a total of EUR1.2 billion to its
shareholders . The TSR of the Saint-Gobain share climbed to 69% for
the year as a whole:
- Almost EUR700 million was paid by the Group to its
shareholders in respect of the dividend for 2020;
- Saint-Gobain Group spent EUR518 million buying back its shares
in 2021 (net of offsetting employee share creation) in order to
reduce the number of shares outstanding to 521 million at December
31, 2021 from 530 million at end-December 2020, ahead of its target
of EUR2 billion in share buybacks over five years (2021-2025).
In 2022 , the Group therefore expects to return over EUR1.2
billion in total to shareholders :
- At today's meeting, Saint-Gobain's Board of Directors decided
to recommend to the Shareholders' Meeting on June 2, 2022 a cash
dividend up 23% to EUR1.63 per share (versus EUR1.33 in 2020). This
dividend represents 30% of recurring net income and a dividend
yield of 2.6% based on the closing share price at December 31, 2021
(EUR61.87). The ex-dividend date has been set at June 6 and the
dividend will be paid on June 8, 2022;
- The Group will allocate at least EUR400 million for share
buybacks in 2022 (net of offsetting employee share creation) - in
order to further reduce the number of its outstanding shares - in
line with the objectives announced on presenting its "Grow &
Impact" plan on October 6, 2021;
- The Group will recommend to the Annual General Meeting of June
2, 2022 to increase the maximum purchase price for its own shares,
from EUR80 to EUR100 per share .
Outlook and strategic priorities
2022 outlook:
In 2022 the Group should continue to benefit from good momentum
in its main markets - especially renovation in Europe, as well as
construction in the Americas and in Asia - and reaffirm its
excellent operating performance thanks to a solid and well-aligned
organization. In this environment, and provided there is no new
major impact related to the coronavirus pandemic and the
geopolitical situation, Saint-Gobain expects the following trends
for its segments:
- Europe : supportive renovation market, requiring comprehensive
solutions that increase efficiency and save time for customers,
albeit with a high comparison basis in the first half;
- Americas : upbeat market trends, particularly in residential
construction in North America and in Latin America overall, despite
a less dynamic environment in Brazil;
- Asia-Pacific : market growth with continued good momentum in
China and India, and a gradual recovery in South-East Asia with
fewer pandemic-related restrictions;
- High Performance Solutions : growth in industrial markets,
with supportive long-term trends in sustainable construction and a
demand for innovation and new materials for industry
decarbonization and green mobility, despite uncertainties as to the
recovery of the automotive market in Europe.
Strategic priorities:
In this supportive environment, our strategic priorities for
2022 are fully aligned with the medium and long-term structural
growth scenario in the "Grow & Impact" plan:
1) Accelerate the Group's growth and impact
- Outperformance versus our markets , as demonstrated by the
good volume momentum throughout 2021, thanks notably to our
comprehensive range of integrated, differentiated and innovative
solutions offering sustainability and performance for our
customers, developed within the scope of an organization as close
to the ground as possible in each country or market;
- Determined deployment of our ESG initiatives in line with our
2030 roadmap towards carbon neutrality in 2050;
- Ongoing optimization of the Group's profile , with the full
effect of the Chryso integration and preparation for the GCP
acquisition in the second half, as part of a vigorous dynamic of
targeted and value-creating acquisitions and divestments .
2) Continue our initiatives focused on profitability and
performance: maintain a robust margin and strong free cash flow
generation
- Constant focus on the price-cost spread , with, as in 2021,
strong pricing agility and discipline capitalizing on a significant
carry-over price effect amid inflation in raw material and energy
costs of the same order of magnitude as in 2021;
- Disciplined continuation of our operational excellence program
;
- Maintaining the structural improvement in operating working
capital requirement while maintaining a good level of inventories
to best serve customers;
- Capital expenditure of around EUR1.8 billion , in line with
the Group's objective of between 3.5% and 4.5% of sales, with
strict allocation to high-growth markets and digital
transformation.
In a structurally supportive market environment, Saint-Gobain is
targeting a further increase in operating income in 2022 compared
to 2021 at constant exchange rates.
Financial calendar
- An information meeting for analysts and investors will be held
at 8:30am (GMT+1) on February 25, 2022 and will be streamed live on
Saint-Gobain's website:
https://www.saint-gobain.com/en/news/full-year-2021-results
- Sales for the first quarter of 2022: Thursday April 28, 2022,
after close of trading on the Paris Bourse.
- First-half 2022 results: Wednesday July 27, 2022, after close
of trading on the Paris Bourse.
Analyst/Investor relations Press relations
+33 1 88 54
29 77
+33 1 88 54 +33 1 88 54
19 09 26 83
Vivien Dardel +33 1 88 54 Patricia Marie +33 1 88 54
Floriana Michalowska 15 49 Bénédicte 14 75
Christelle Gannage +33 1 88 54 Debusschere +33 1 88 54
Alix Sicaud 38 70 Susanne Trabitzsch 27 96
----------------------- ------------- --------------------- -------------
Glossary :
Indicators of organic growth and like-for-like changes in
sales/operating income reflect the Group's underlying performance
excluding the impact of:
-- changes in Group structure, by calculating indicators for the
year under review based on the scope of consolidation of the
previous year (Group structure impact);
-- changes in foreign exchange rates, by calculating indicators
for the year under review and those for the previous year based on
identical foreign exchange rates for the previous year (currency
impact);
-- changes in applicable accounting policies.
EBITDA = operating income plus operating depreciation and
amortization, less non-operating costs.
Free cash flow = EBITDA less depreciation of right-of-use
assets, plus net financial expense, plus income tax, less capital
expenditure excluding additional capacity investments, plus change
in working capital requirement.
Free cash flow conversion ratio = free cash flow divided by
EBITDA, less depreciation of right-of-use assets.
ROCE (return on capital employed) = operating income for the
year adjusted for changes in Group structure, divided by segment
assets and liabilities at year-end (see breakdown in Note 5 to the
financial statements).
ESG : Environment, Social, Governance.
All indicators contained in this press release (not defined in
the footnote) are explained in the notes to the 2021 consolidated
financial statements, available by clicking here:
https://www.saint-gobain.com/en/news/full-year-2021-results
The glossary below shows the notes in which you can find an
explanation of each indicator.
Glossary :
EBITDA Note 5
ROCE Note 5
Net debt Note 10
Operating income Note 5
Net financial expense Note 10
Recurring net income Note 5
Business income Note 5
Working capital requirement Note 5
Important disclaimer - forward-looking statements :
This press release contains forward-looking statements with
respect to Saint-Gobain's financial condition, results, business,
strategy, plans and outlook. Forward-looking statements are
generally identified by the use of the words "expect",
"anticipate", "believe", "intend", "estimate", "plan" and similar
expressions. Although Saint-Gobain believes that the expectations
reflected in such forward-looking statements are based on
reasonable assumptions as at the time of publishing this document,
investors are cautioned that these statements are not guarantees of
its future performance. Actual results may differ materially from
the forward-looking statements as a result of a number of known and
unknown risks, uncertainties and other factors, many of which are
difficult to predict and are generally beyond the control of
Saint-Gobain, including but not limited to the risks described in
the "Risk Factors" section of Saint-Gobain's Universal Registration
Document available on its website ( www.saint-gobain.com ).
Accordingly, readers of this document are cautioned against relying
on these forward-looking statements. These forward-looking
statements are made as of the date of this document. Saint-Gobain
disclaims any intention or obligation to complete, update or revise
these forward-looking statements, whether as a result of new
information, future events or otherwise, except as required by
applicable laws and regulations.
This press release does not constitute any offer to purchase or
exchange, nor any solicitation of an offer to sell or exchange
securities of Saint-Gobain.
For further information, please visit www.saint-gobain.com .
Click on, or paste the following link into your web browser, to
view the associated PDF document.
http://www.rns-pdf.londonstockexchange.com/rns/7742C_1-2022-2-24.pdf
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