The magazine

Transcription

The magazine

Lafarge 2005
exploring
moving
contributing
realizing
the world on the move
forward in our professions
to a sustainable world
Lafarge’s unique potential
C
onvinced that the search for performance goes
hand in hand with well-being and harmony, we
want to share our conviction with all those with
whom we interact on a daily basis, our customers,
shareholders, employees and partners, as well as those
who participate in and follow economic and social
development.
Crescendo, to be published biannually, is Lafarge's new
magazine. It is the platform for us to present the challenges
that we face. Halfway between an annual report and a
brand magazine, Crescendo will show Lafarge and its
environment as they are today in a perpetual state of
change.
Each issue will highlight our economic and technical
performance, along with our innovations, results, and
research. To this end, Crescendo will draw on the foresight
of those who help renew our world view and on our ability
to build an improved and sustainable vision of everyday
life on our planet.
The Group is entering a new era. The launch of this
magazine reflects that change, and it reminds each of us
that our expectations and demands for excellence are
the continuous driving forces behind Lafarge. Our role
as leader is to explore the world as it evolves, to move
our activities ever forward and to contribute to the creation
of a more sustainable world.
contents
02 Message from the Chairman
04 Interview with the Chief Executive Officer
08 The new management team
exploring the world on the move
12 Tomorrow's cities |
16 New needs |
20 New materials |
24 New passions |
moving forward in our professions
30 Innovation |
34 Operational excellence |
38 A truly multi-local strategy |
42 Enterprising management |
contributing to a sustainable world
48 Banda Aceh, Indonesia | 50 Tetouan, Morocco |
52 Rion-Antirion, Greece | 54 Harbin, China |
56 Woodmead, South Africa | 58 Radauti, Romania |
60 Paris, France | 62 New York, United States |
realizing Lafarge’s unique potential
66 The Group | 68 Key figures | 70 Cement |
74 Aggregates & Concrete | 76 Roofing | 78 Gypsum |
80 Organization of the Group |
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message
from
the Chairman
A year of
change
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L
BERTRAND COLLOMB,
Lafarge Group
Chairman
afarge Chairman Bertrand Collomb revisits the tremendous developments achieved
by the Group over the past few years, and talks about the rapid pace of change
at Lafarge and in its environment.
Lafarge has undergone a major transfor-
I would also like to take the opportunity to applaud the
mation in the last five years. From the
remarkable achievements of Bernard Kasriel, particularly
acquisition of Blue Circle to the more recent
his work in formalizing methods, organizing the sharing of
move into China, our Group has successfully
know-how and laying the foundation for tomorrow's growth.
taken on many new challenges.
Thanks to his determination, Lafarge became one of the first
To accompany this growth, all of our employees –
from the newest hires to our longest-serving
colleagues – have been mobilized around the
Group's values over the past two years. A large effort has
gone into establishing the conditions necessary to achieve
our aims. Together, we have reaffirmed our priorities: to
put the customer at the heart of all our efforts, to deploy
European companies to obtain Sarbanes Oxley certification.
Today, we can be proud of the quality of our internal controls.
Beyond the significant regulatory requirements, this project
enabled us to accelerate the standardization of our
information systems and to strengthen our internal
processes, thereby allowing us to streamline our multi-local
organizational structure.
our performance culture in order to increase and improve
Our environment is in a perpetual state of change. We must
what we deliver, and to develop the skills and the sense of
not only pay close attention to the world with each passing
responsibility of each individual.
day, but we must also anticipate and act wisely to contribute
I have confidence in Lafarge's ability to tackle the new
challenges it has set for itself. For I know that the Group is
backed by talented, hard-working and committed teams,
a strong brand and quality products.
to the creation of a sustainable world.
Our Group is deeply convinced that progress is only of
real significance when it is shared. Our humanist values are
not only in step with our demands for ever greater
performance; they are the primary condition for these,
Despite a difficult economic context of exceptionally high
energy prices and raw material costs, the Group has
demonstrated its growth potential, albeit imperfectly, in its
our raison d’être. In our Group, the exchange of ideas, debate
and openness to the world are considered to be sources
of strength in and of themselves.
2005 results. The increase in our share price since the
beginning of the year indicates that the stock market has
begun to appreciate our true potential.
We are now, more than ever, involved in the environmental
management of our operations and quarries, accompanying
local communities in their efforts. We are equally committed
In this context, as planned with Bernard Kasriel, Bruno Lafont
took hold of the reins of the Group's management on
January 1, 2006.
I welcome his arrival and I am pleased with his determination
to implement the changes needed at this stage to pursue
the Group's development. With the Group's teams, Bruno
Lafont will be able to realize Lafarge's enormous potential,
to promoting more sustainable methods of construction.
Our role as leader is to promote continual progress in our
activities and to contribute to the creation of a more
sustainable world.
I believe in the future, our new management team and the
potential of our Group, which, I am certain, will strengthen
its role as the world leader in building materials.
while reinforcing the focus on growth in earnings per share
■
for the benefit of our shareholders.
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about us
new
momentum
for Lafarge
B
runo Lafont became Chief Executive Officer of Lafarge on January 1, 2006,
following a long career within the Group. He presents his vision and strategic
plan to give the Group new momentum.
What did you do to prepare for the position
our current organization to make it more responsive and
of Chief Executive Officer of Lafarge?
responsible. The transformation is ongoing and the new
BRUNO LAFONT | Over the past two years, I have spent
organization will be 100% efficient by the end of the year.
more than 200 days visiting the Group's operations around
At the same time, I launched a bid to acquire the shares of
the world, assessing our strengths and areas where we
Lafarge North America held by minority shareholders. Our
could improve, and exchanging ideas with numerous
management style is now resolutely results oriented, with
employees. I also led the Leader for Tomorrow program
tighter cost controls and aimed at achieving operational
to mobilize the Group's 80,000 employees. This program,
excellence in all areas.
which was launched by Bertrand Collomb in 2003, focused
on our goals, our values, our performance culture, and
In February 2006, you presented a new strategic
our customers. It provided me with a very accurate picture
plan for the Group. Can you give us brief summary
of the Group and a better understanding of the amazing
of it?
potential of our portfolio of businesses and geographical
B. L.
positions. I have great faith in the future of our Group
transformation the Group has undergone over the past five
and a very clear idea of the challenges we must now take
years to unlock the considerable potential of our current
on to become the undisputed world leader in building
portfolio of assets and extract the corresponding value.
materials. This means being the most innovative, the best
Lafarge, which practically doubled in size with the acquisition
in performance, the best in the sector.
of Blue Circle, has achieved remarkable international growth
| We are going to take advantage of the major
in plasterboard, taken significant positions in fast-growing
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You put a new organization into place when you were
emerging economies, overcome hurdles in its environment,
appointed CEO. What impact do you expect it to have?
and gained new momentum in China. Today, our strategy
B. L. | I decided to form a tighter Executive Committee to
consists of extracting the extraordinary potential from
accelerate our decision-making process, improve our
our portfolio of assets, our geographical positions around
efficiency and have a maximum impact. I intend to simplify
the globe, and our industrial know-how to create value for
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BRUNO LAFONT,
Chief Executive
Officer of Lafarge
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about us
our company and our shareholders. We are going to extract
Furthermore, we are seeking to promote more sustainable
the potential from our existing business portfolio to generate
construction methods. The focus is on developing new
organic sales growth in excess of 5% per annum. To this end,
products and new solutions to reduce the ecological footprint
we will pursue growth through capacity expansions and
of buildings. All of our employees are involved in this effort.
acquisitions, in order to strengthen our market share,
We are working closely with the entire construction chain,
accompany the development of our markets and participate
as exemplified by our partnership with architect Jacques
in the consolidation of those markets, while respecting strict
Ferrier in the design of an environmentally responsible
criteria in terms of profitability and maintaining a solid
tower building.
financial structure.
You emphasize safety. Why is Lafarge focusing
How important is innovation?
on this?
B. L. | Innovation has to be one of the engines of our strategy.
B. L. | Safety is where our performance culture and our long
We are seeking to increase our lead over the competition by
humanist tradition cross paths. It is of utmost importance
taking greater advantage of the power of our research and
in our industry. We are already the best in our field, but
of our capacity to launch new products that add value for
we have an even more ambitious goal to achieve the level
our customers. For example, Agilia® is a range of self-placing
of the world’s safest industrial groups. It is a key part of our
concretes that is unique in the market. It is a perfect example
performance programs and it must remain an absolute
of the success of our vertically integrated model and our
priority for all the Group employees. Safety is a precondition
combined research in Cement, Aggregates & Concrete,
of operational excellence and key for a Group which places
and Admixtures. It is a product that also contributes to
people at the heart of its concerns.
progress in construction, because it offers architects new
possibilities. Furthermore, its results are promising.
What are your main objectives?
Launched in 2000, Agilia® currently represents 2% of sales
B. L. | Our priority is to extract the full potential from our
and 10% of income in our Concrete business. In 2005 alone,
current portfolio of assets. I have set a strict cost reduction
Agilia® sales increased by more than 25%, and we expect its
objective, which by itself should boost operating margin
contribution to income to double again by 2008. It is a
by one percentage point by 2008. This is a minimum. Beyond
tremendous opportunity for growth and an example that
that, our performance programs are collectively a
should be followed and replicated.
considerable asset for achieving greater earnings.
“ My priorities are clear:
Increase value for
the company and enhance
returns for our
242,000 shareholders”
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“ Lafarge has
considerable
potential.
I have great faith
in the future”
yearly average growth of 8% in net earnings per share and
an increase in return on capital employed. Beyond 2008,
we will reexamine how these objectives might be increased.
We have also proposed an immediate 6% increase in the
dividend to the Board of Directors, as well as an end to
scrip dividends to avoid diluting earning per share. I will, of
course, be paying close attention to our share price. Our
shareholders are right to have high expectations. We need
to provide answers quickly and improve the effectiveness
of our communications with our stakeholders. We want to
be transparent with our shareholders and have decided to
inform them more regularly, by issuing quarterly results.
This will allow us to measure our progress more often and
to keep the market better informed of our actions.
This plans are very ambitious for Lafarge, aren’t they?
B. L. | Yes, our goals are ambitious. They go well beyond
anything we have done up to now. They are also realistic,
and I am here to accelerate Lafarge’s existing momentum.
Along with building new capacity and marketing our
innovations, which should increase organic sales growth at
a rate above 5% per year, we will focus on strongly valueenhancing acquisitions to consolidate our markets and local
positions. These acquisitions will be subject to two
conditions: the return on capital employed must cover
the weighted average cost of capital within four years and
the acquisitions must be compatible with our objectives
in terms of earnings per share, return on capital employed
and financial structure.
We are going to move forward in a methodical and disciplined
way, while reinforcing responsibility at all levels of the Group.
My role and the role of my new team is to meet our
commitments, continue to aim high and drive the entire
organization forward, to produce results year after year that
reflect our determination to make the Group the undisputed
world leader in building materials. By that I mean the
industry's best, a company that delivers maximum value
to its shareholders, its employees and its environment. ■
Lastly, I have set a clear objective for our Roofing business:
to cover its cost of capital by 2008, which corresponds to
Ebitda of €350 million, compared to €222 million today. As
our strategic plan is rolled out, I remain wholly committed
to implementing our strategic business plan to preserve
our financial structure and to ensure that the progress we
make is fully reflected in the value of our shareholders'
investment.
What are your commitments to Lafarge
shareholders?
B. L. | The priority I have set – which underlies my strategic
plan – is to create value for the company and increase returns
to our 242,000 shareholders. We are seeking sustainable
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about us
the new
management team
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MICHEL ROSE |
Chief Operating Officer,
Co-President of the Cement business
ULRICH GLAUNACH |
Executive Vice-President,
JEAN-CHRISTOPHE BARBANT |
President of the Roofing business
ISIDORO MIRANDA |
President of the Gypsum business
CRESCENDO
O
ne of the first decisions made by Bruno Lafont,
who became CEO of Lafarge on January 1, 2006,
was to create a tighter management team to
maximize efficiency, speed up the decision-making
process, mobilize the entire organization, and make the
Group the undisputed leader in building materials.
BRUNO LAFONT |
Chief Executive Officer
GUILLAUME ROUX |
JEAN-CHARLES BLATZ |
President of the Aggregates & Concrete business
JEAN-JACQUES GAUTHIER |
Finance
CHRISTIAN HERRAULT |
Human Resources and Organization
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exp
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loring
the world
on the move
L
isten, discover, and progress. Listen, in order to act
tomorrow in the best interests of the planet. Twice a year,
Crescendo will open its pages to all those who explore
the future and contribute to re-energizing and moving the world
forward through intellectual, scientific, artistic, and social activities.
As part of this debate, as people who take initiatives, we make
it our priority to constantly look for new ways to contribute to
progress in all fields.
12 Tomorrow's cities | 16 New needs |
20 New materials | 24 New passions |
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exploring
tomorrow's cities
the city
in permanent (r)evolution
T
he vast majority of people in developed
countries live in cities, which are continuing
to grow. Now, more than ever, urban infra-
structures are becoming economic engines driven
by individuals who are increasingly autonomous and
mobile. To gain a better understanding of how cities
must evolve in the face of this cultural shock, we
interviewed Francois Ascher.
FRANCOIS ASCHER is a professor
at the French Institute of Urban Planning
at the University of Paris VIII, France,
and at the University of Geneva, Switzerland.
He is also chairman of the City on the Move
Institute's research and steering committee
and has authored numerous books,
including “Metropolis, or the Future of Cities”
and the “Hypermodern Society”.
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You say that society is moving away from the industrial
Are big cities being rethought under such conditions?
revolution towards a new modernity. What are the main
F. A. | A large majority of people in developed countries
characteristics of this new modernity?
already lives in cities. However, urbanization is taking on a
FRANÇOIS ASCHER | Developed societies appear to be pursing
new form: metropolization. To a certain extent, the largest
a path to modernity that has three major characteristics:
cities are ‘growing externally’, absorbing as a part of their
individuals are seeking greater and greater autonomy, giving
daily functioning the surrounding towns, boroughs, villages,
rise to a society that is increasingly differentiated; science
and countryside. Vast metropolitan areas that no longer
and technology are playing a growing role in all social
resemble the cities of the previous period are rising up. These
activities; and a new capitalism appears to be emerging,
are distended, discontinuous, heterogeneous, and multi-
founded on a knowledge-based economy that will likely also
polar urban zones. Urban planning must change under these
be based on the environment in the longer term. It won't
conditions.
sound the death knell for industry any more than industry
Long-term planning for cities is becoming increasingly
put an end to agriculture, but it does place production
difficult to do, and we are seeing the emergence of new
and the use of knowledge and information and their
approaches, many of which owe their inspiration to the
associated technologies at the heart of societal dynamics.
strategic and heuristic management methods of the business
It's a new phase of modernity that is being sketched out.
world. To be able to reassess plans without losing sight of
I call it hyper-modernism. This trend has progressively
strategic objectives, we need more projects, greater flexibility
put operating methods and ways of thinking into a crisis,
and more technology.
and it has not spared economic players who are confronted
with unprecedented diversity, complexity and uncertainty.
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exploring
tomorrow's cities
“ Mobility is a major
challenge for today's
new metropolitan
areas”
FRANÇOIS ASCHER
Urban planners must also take into account a greater variety
At the same time, transportation raises energy issues and
of demands, the diversity of lifestyles, and habitats. We must
contributes significantly to the greenhouse effect. We have
be able to build cities that are varied and capable of evolving.
to find a successful way to limit the environmental impact
It's a cultural shock for many urban planning professionals
of transportation without limiting mobility. In this respect,
who in the past often had set ideas about what kind of
urban planning can play a role. Transport hubs can be built
cities needed to be built.
near dense population centers, individual homes can be
grouped in lots, and transport services can be developed
In your opinion, what places or urban features will
to serve those areas. But I also believe that environmental
be decisive for tomorrow's cities? Where do concerns
issues are such today that public authorities will pass
about sustainable development factor into the trend?
increasingly strict measures, requiring both individuals
I think mobility is a major challenge today. In new
and businesses to replace goods and equipment that no
metropolitan areas, mobility is needed to gain access to
longer meet environmental standards. That's why, I think,
work, the home, healthcare, education, culture, leisure
this era of cognitive capitalism we are entering into will
activities, and so on. The right to mobility has become a
also be an environmental capitalism. One that will replace
kind of generic right that conditions all other rights. Because
or change some problems...
a significant portion of the population does not have the
means to get around or can do so only in poor conditions,
we must improve city transit systems and probably renew
the public service concept of such systems.
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Guangzhou speeds ahead
with urban transformation
Faced with unprecedented demographic
pressures, it is imperative that Chinese cities
develop infrastructure to preserve the mobility
of their increasingly dense populations.
Guangzhou, host of the 2010 Asian Games,
is a perfect illustration.
July 1, 2004 – the Asian Olympic Committee selects Guangzhou as the host city
21
million
for the 16th Asian Games in 2010. The distinction is in keeping with the image
of a city that in just a few years has become China’s third largest economic
metropolis, and the largest city in South China.
“Hosting the Asian Games is a tremendous event for our city, one that will accelerate
our urban transformation,” declares Professor Yuan Qifeng, from Sun Yat-sen
University and head engineer of Guangzhou’s urbanization project. “The city
plans to invest over 20 billion euros between 2005 and 2010.” To facilitate the
movements of spectators, transportation will be one of the top investment priorities.
Plans include new subway lines, expansion of the international airport, reinforcement
of the road network on the outskirts of the city, and construction of a new train
station. Yet the project does not stop there, and the local economy as a whole
should benefit from this event. A good example is the construction of a 610-meter
television tower, which will be the tallest in the world. “Guangzhou is a model of
urban development, built to address concrete demand over the long term,” explains
The average number
Professor Yuan Qifeng. It is a model that China can be proud of as it invents the
of new city dwellers in China
cities of tomorrow.
each year
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exploring
new needs
Designing buildings
with low
co2
T
emissions:
A major challenge
for the entire industry
and for the planet
he Earth’s climate has changed during
the 20th century, with higher average
temperatures, reduced glacier coverage,
rising sea levels and more frequent violent
meteorological events. The big surprise gleaned
from scientific observations over the past fifty years
is that human activity is largely responsible for
escalating this climate change.
According to James P. Leape, Director General of
WWF International, there is still time to act, but we
must do so quickly if we want to preserve our
environment.
JAMES P. LEAPE,
Director general
of WWF International
Record-breaking heat waves, droughts, hurricanes,
flooding… Do all these events reflect climate change
due to global warming?
JAMES P. LEAPE | It really does look as if global warming is
contributing to the upsurge in violent weather events across
the planet. The proportion of category 4 or 5 hurricanes,
for example, has doubled since 1970.
Atmospheric data recorded daily by thousands of weather
stations around the world tell us that the Earth has warmed
by about 0.7°C since 1860. We also know that the warmest
years occurred during the past two decades and that 2005
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was the warmest year of all. If we do not take drastic measures
You say that cement manufacturing affects climate
to reverse this trend, the Earth could warm by about 5°C
change. Can anything be done to minimize its
or even more over the next century – an enormous increase,
impact?
the risks of which have not been sufficiently measured by
J. P. L. | Cement is particularly rich in carbon. Yet it serves
our society.
to make concrete, the most widely used building material
What are the main causes of global warming?
J. P. L. | The burning of fossil fuels – coal, oil and natural
gas – is the number one cause of climate change attributable
to man. Next is deforestation. These two activities emit
CO2, which makes up about 80% of the pollutants
in the world. The cement industry must strive to develop
new cements with low CO2 emissions, as well as new
materials using recycled cement. This is a major challenge
for the industry as well as for all of humanity.
How does WWF help to meet these challenges?
responsible for global warming. Other culprits are
J. P. L. | We have established numerous partnerships with
transportation, construction and industry. Although cement
different types of players, including corporations, institutions
production is responsible for only about 5% of all CO2
and local communities. Trust, transparency and measurable
emissions, its contribution could rise due to growing
objectives are the principal factors ensuring the success of
demand for new buildings and infrastructure.
these partnerships. And if their efforts are deemed credible,
Do you think that the targets set by the Kyoto protocol
for 2012 are sufficient in the long term?
J. P. L. | No. Between now and 2012, the Kyoto protocol calls
for the industrialized nations to reduce their CO2 emissions
it is because they have combined ambitious targets with
independent assessment systems. They have already proven
that NGOs and industrial groups can work together to find
positive solutions for the environment.
by about 5% from their 1990 levels. Yet total greenhouse
gas emissions have to be reduced worldwide, not just in the
industrialized countries. And they must be cut drastically.
European countries should reduce their greenhouse gas
emissions by 30% before 2020. WWF has shown this is
possible. Much more must be done by all of the signing
members of the Kyoto protocol.
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exploring
new needs
innovating
to meet the needs
of the poorest
M
eeting the needs of the neediest. A market
with a future for private companies.
Ashoka, an association network that
promotes the development of social contracting
in more than 60 countries, supports and finances
the work of individuals who offer innovative and
pragmatic solutions for improving the living
conditions of disadvantaged populations. To
achieve its aims, Ashoka is seeking to develop new
synergies with the business world, among other
areas. Today, the association is on the cutting edge
of a new low-cost housing concept. So what needs,
STÉPHANIE SCHMIDT,
Director, Full Economic Citizenship
Initiative - Global at Ashoka International
OLIVIER KAYSER (right),
Vice-President of Ashoka International
economic realities, and medium and long-term
societal challenges do these new means of
construction correspond to? Crescendo thought
you might like to know. Olivier Kayser, VicePresident of Ashoka International, and Stéphanie
Schmidt, Director, Full Economic Citizenship
Initiative – Global, unveil the emergence of this
new market and explain the strategy of the
“Economic Citizenship for All” program.
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How does the concept of social contracting relate to the
O. K. | Low-income communities want to become part of
solvency of the world's poorest people?
the market, as producers and consumers. That's what
OLIVIER KAYSER | Contrary to popular opinion, price is
economic citizenship is all about.
not the main reason why poor people are not able to buy
products made by big business. In the same way, access
So where do you start?
to housing is limited by a lack of access to financing, which
S. S. | Business as usual won't do. Companies need to
in turn stems from the lack of a steady revenue stream
recognize that they don't know much about these markets.
and the absence of property rights. Simply lowering the
To reach far-flung slums and rural areas, they need to rethink
price of building materials won't help much. Imaginative
their product ranges and distribution channels and redefine
"systemic" solutions are needed to overcome these obstacles,
their communication strategies. To that end, social
and this is where social contractors excel.
contractors make the best partners because of their deep
STÉPHANIE SCHMIDT | Ashoka launched a new initiative
knowledge of these potential customers.
called "Economic Citizenship for All" to help create strategic
commercial alliances between private enterprise and social
What role can building material companies play?
contractors. The goal is to serve low-income markets by
S. S. | They can develop new solutions by working with
establishing social and economic objectives to guarantee
other players in micro-finance, for example. Government-
the commitment of the partners over the long term.
backed housing programs are insufficient and do not
Why should private enterprise get involved in these
resolve the problems of poverty and exclusion when they
programs?
are assistance-based.
S. S. | Low-income markets account for 80% of the world's
O. K. | Access to housing is one of the primary needs of low-
population and constitute an enormous reservoir of growth.
income communities and it offers a true springboard to
Developing countries are expected to account for 98% of
economic and human development.
the growth in the world's population through 2025. In Brazil,
for example, 29.6 million low-income households, which are
considered “bottom of the pyramid”, represent 41% of the
overall purchasing power of the country's population. The
housing shortage in this country alone is in excess of 7 million
units.
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exploring
new materials
nanotechnology to serve
building
materials
F
or years, scientists specializing in materials
have been striving to better understand
the forces that control the behavior of
construction materials: durability, strengh, ductility,
longevity, aesthetics and thermal behaviors, among
others. All of these characteristics originate in the
microstructure of materials, and to explore them
today
requires
increasingly
sophisticated
technologies, often at the nanometric level. The
goal is to build models of typical interactions and
Professor PAULO J. M. MONTEIRO
is the Group Head of Structural Engineering,
Mechanics and Materials (SEMM) at the
University of California – Berkeley.
A specialist in the structure of building
materials, he has written a thesis on the
microstructure of concrete and has published
several important books, as well as numerous
articles in the specialized press.
to reproduce them, first in the laboratory and then
in the field. In this way new technology is transferred
to industry and new materials are developed to
address new needs… providing solutions for the
wildest dreams.
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Nanometer-scale image of a material.
You are a researcher and a world specialist
You mention the microstructure of materials.
in the structure of building materials.
What role does nanotechnology play in your work?
Why is it necessary to take a scientific approach
P. M. | Today, research is carried out at the nanometric level,
to the development of materials?
and enormous challenges must be met, such as the sensitivity
PAULO MONTEIRO | I am often asked that question. The
of materials to changes in temperature or humidity. It was
general public does not always associate new materials with
long believed that building materials were homogeneous.
fundamental research. Even so, the development of new
However, we realized after working at the microscopic level
building materials presupposes a comprehensive
that they are actually highly complex and extremely
understanding of the mechanisms responsible for their
heterogeneous. We now use leading-edge technology such
strength, stiffness and durability. This is why a precise
as atomic force microscopy, nano-indentation, scanning
understanding of the microstructure of materials is
electron microscopy and X-ray microscopy.
necessary.
How do you go about developing new materials?
To be more concrete, what are the benefits
P. M. | For years, the development of new materials was a
for industrial companies in the sector?
bit like alchemy: we used a hit or miss approach, relying on
P. M. | There are numerous payoffs. For example, if industrial
trial and error to make progress. Today, our approach blends
groups want to develop more resistant materials, they first
fundamental science with advanced experimental methods.
need a better understanding of the binding forces at work in
We develop models that are then tested in laboratories.
the hydration products. This can be achieved through
Moreover, since it is impossible for a single individual to be
fundamental research. Other examples: work on chemical
an expert in all subjects, we have created truly multi-
additives led to the development of self-placing and self-
disciplinary scientific networks.
leveling concretes; research on the microstructure of steel
reinforcement is used to develop new reinforced-concrete
structures with a useful life of several hundred years.
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exploring
new materials
“ Today, research is carried
out at the nanometric level,
and enormous challenges
must be met”
PAULO J. M. MONTEIRO
What are the advantages of a multi-disciplinary
In parting, could you reveal some of the big
approach?
research topics that the scientific community
P. M. | Working with researchers from a variety of disciplines
is currently working on?
often sparks new ideas. For example, it was while working
P. M. | One of the big themes is material longevity. A useful
with biophysics researchers to develop procedures to
life of about fifty years is no longer acceptable.
study cement using low-temperature scanning electron
Consequently, we are working on developing a new
microscopy, that I was first led to use soft X-ray microscopy.
generation of building materials with a much longer product
As a result, I obtained precious information on the
life.
hydration process.
Yet other areas are also being explored through
fundamental research. Consider materials that are used
to repair engineering works: there is an enormous market
for industrial groups in this sector, with the development
of advanced building materials. In the United States alone,
there are currently about 250,000 bridges that need to
be repaired or renovated!
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Industrial competitors
can share knowledge
Setting aside the clichés of cutthroat competition
between industrial rivals, cement manufacturers
in the European research network Nanocem felt the need
to join forces in order to share knowledge
and accelerate research, for the greater benefit of all.
Professor KAREN SCRIVENER,
Swiss Federal Institute of Technology
in Lausanne (EPFL), director of the Building
Materials department and coordinator
of the Nanocem network
Nanocem, a European research network created in 2004, has successfully managed
to get twelve European cement and related products manufacturers – including
Lafarge – and 21 academic institutions to work together. Nanocem’s goal is to
associate corporate R&D with academic scientific research to develop a better
understanding of construction materials. “Cement and concrete are the most
widely used materials in the world, but they are still very poorly understood,”
observes Professor Karen Scrivener, coordinator of the Nanocem network. “By
combining our efforts and resources we have a range of tools and expertise
that is rarely found within any one, single laboratory. It enables us to analyze
and understand the fundamental mechanisms behind the behavior of materials.”
Nanocem harnesses the latest technology to study the microstructure of materials.
“Corporate partners finance the work of scientists, who focus their research on
projects that are likely to yield technologies that can be transferred to the cement
industry,” explains Professor Scrivener. “Our ambition is to build a knowledge
database for developing new materials and to improve existing ones, but also
to ensure that cement and concrete are finally recognized as sustainable, high
technology materials.”
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exploring
new passions
Rudy Ricciotti’s
material
dreams
F
or Rudy Ricciotti, materials evoke past
experiences, encounters and childhood
emotions, bringing forth a desire to
share, to touch, to invent a world where both
sensitivity and sensuality have their place.
“ You have to start with materials and look at them from a
romantic point of view. When I was about 10 years old, there
was no school on Thursdays, and I would go to the
construction sites where my Italian father, working as a
foreman, built low-income housing. I remember wearing
plastic sandals, stepping in the freshly poured concrete…
On Fridays, my father would meet with the masons, metal
workers and carpenters, one by one, to give them their pay.
RUDY RICCIOTTI, born in Algiers, Algeria
in 1952, is an architect. His agency is based
in Bandol, in the south of France.
An iconoclast, he is known for diverse array
of projects, e.g. the Museum of European
and Mediterranean Civilizations,
the Potsdam Symphony Concert Hall,
the new Palace of Festivals in Venice,
the National Choreographic Center
in Aix-en-Provence, and the new wing of the
Louvre Museum in Paris dedicated to Islamic
arts. His unique approach in applying building
materials, especially his work with concrete,
has led him to collaborate often with
the Lafarge Group.
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It was a microcosm of the Mediterranean, and he knew them
all. Discussions were frank, sometimes heated. The masons
were tough. To me they were magicians.
That’s where I learned to love the people who work with raw
materials, real matter. It was a man’s universe, gung-ho and
rugged, but also fraternal…as a child I looked upon the
masons with hammers hanging from their belts as if they
were gladiators.
Computer image of the Mucem project in Marseilles, France. Architect: Rudy Ricciotti.
When it comes to materials, there’s no segregation along
Today, with ultra-high-performance fiber-reinforced concrete,
class lines. In the building industry it’s the same: there
we are about to embark on a new industrial adventure.
are simply people and their skills, trades and businesses.
Architects are like test pilots heading down the runway,
As an architect, I’m part of the family: I love being with
ready for take-off…they must have total confidence in the
engineers, craftsmen and mates. I didn’t learn my trade at
calculations and professional skills of mechanics and
architecture school; I learned it from the people in the
engineers. We are on the verge of switching from propellers
building industry. I owe them everything.
to jet engines. The Footbridge of Peace in Seoul spans 130
Concrete can be sublime. It can also inspire fear. In intercity
zones, it reflects hopelessness. It becomes sublime in great
engineering works, in dams and bridges, and in certain
meters, yet its platform thickness is just three centimeters
for a static end-girder height of 1.3 meters! The concrete
melds into a slender stroke.
contemporary architectural masterpieces – such as Le
With the Museum of European and Mediterranean
Corbusier’s Ronchamp church, or the CNIT building in Paris
Civilizations in Marseille, France, the materials present a
La Defense – where sensible projects take surreal flight.
different kind of complexity. The setting, at the foot of
To do this job, you have to accept that not everyone will like
what you do – particularly the contractor, who is often
anxious to cut costs. I fight against cheap hardware, plastic,
aluminum, ugliness… My buildings work. The contractors
are forgotten, but the memory of the craftsmen lingers
on. This is how the tradition of skilled craftsmen is
perpetuated, and I’m very proud of that. I don’t use products
that fail to meet ethical standards. That’s my traditional,
conservative side. I’m a European architect and patriot. In
the Saint-Jean fort, facing the sea, offers an absolute mineral
essence. Some people say it reminds them of fine latticework,
or a distant Orientalism. While it can be seen in this way,
there is nothing about the structure that is purely decorative.
Like a fish skeleton, everything is structural. We’re moving
towards a dematerialization of the concrete structure, which
is becoming delicate, gossamer, intricately formed like a
cross-section of coral rock. Nobody knows where this new
material is taking us. We can reinvent the world.
today’s environment, you also have to push for innovation
if you want to defend a qualified workforce.
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exploring
new passions
Christian de Portzamparc
dreams
of musical
architecture
T
internationally renowned architect has
always given music great importance
in his work. Today, he is working on
several projects that are particularly demanding
in terms of acoustics.
“ I love creating architecture for music, spaces where two of our
realms of perception – hearing and sight – can freely converse
and respond. Space affords us this blessing. The emotion of
music lies in the discovery and gradual entry into a different
world, a world that reveals itself in time.
I also understand space as a phenomenon that one grasps over
time, through movement, with its expectations, its surprises,
Born in 1944 in Casablanca, Morocco, CHRISTIAN DE PORTZAMPARC
studied at the École des Beaux Arts in Paris, France.
From simple buildings to the urban re-think, the town is a founding
principle of its work dominated by three major lines:
large landmark buildings (often dedicated to music and intended
for gatherings), urban zones as in the Massena Seine Rive Gauche
area in Paris, and sculptural towers such as the Manhattan tour
in New York, USA, for LVMH.
Based in Paris, he has built structures around the world.
Among other prizes, Christian de Portzamparc was awarded
the prestigious Pritzker Prize in 1994 and the Urban Planning
Grand Prize in 2004. He is an honorary member of the American
Institute of Architects and has held the “Artistic Creation”
chair at the College de France since February 2006.
its concatenations. When sound and light fill this marvelous
void existing in the midst of solid structures, then space
and music are mutually revealed.
I long believed that music had a much greater emotional power
than architecture. I now believe that space has an emotional
power over people that is just as strong. Our lives are
inextricably linked to the numerous places that inhabit our
memories, shape our present or cast us into the future – the
house we grew up in, our schools, gardens, the apartment
we live in today, the places we lived before… If we broaden
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The Philharmonic building in Luxembourg, by architect Christian de Portzamparc: inside view of the light-filtering façade.
the notion of architecture to encompass space and our
relate to each other, to be close, to feel a sense of grandeur
environment, architecture is the story of our lives. Places
and intimacy. I wanted to free the imagination. As always, I
obviously have an emotional power, to the same degree as
worked with acoustics expert Xu Ya Ying. I love the contrast
music. But music is more like a burn, a sharply felt moment,
between the bright, snowy impression of the colonnade and
whereas our relation to space is day-to-day and calm.
the shade of the hall. The wall between them is a prismatic
cliff, etched with acoustic fault lines that play on color.
When I was asked to do the new Philharmonic building in
Expanding on the idea of colored niches designed 20 years
Luxembourg, before visiting the site, I studied photos of the
ago for the La Villette auditorium in Paris, the Luxembourg
area and felt that the public should be guided to the future
Philharmonic’s broad fault lines achieve a chromatic subtlety
building through an initiation zone, a circle of tall trees that
that is altogether different, their geometry breaking down the
one would have to cross to enter the realm of music. But
colors across a height of twenty meters.
once on the site, I saw that we didn’t have enough space to
plant trees. That’s when I got the idea of replacing the ring
Finally, the chamber music hall is set in a leaf that unfurls from
of trees with a light-filtering façade, one that was neither
the ground and rises against the colonnade. This interior shell
opaque nor transparent, forming an envelope of light in which
is based on another experiment, stemming from our work
the auditorium would be the central core. The rhythm of these
on the Moebius strip for the Nara competition in Japan in 1993.
parallel shafts set in several elliptical rows became both
This leaf plays with the filtered light from the outside, masking
mathematical and musical.
it diagonally, and this game of contrast between opaque and
transparent upholds the unity of the project.
At the heart of this colonnade of light lies the grand auditorium.
An auditorium is a musical instrument of uncommon size and,
one could also say, an ‘instrument of space’. Audiences at
the Philharmonic ‘inhabit’ the walls of the auditorium, seated
in multi-level lodges of concrete and wood around the stage,
creating the atmosphere of a public square at night surrounded
by buildings. Here, I wanted the musicians and the public to
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mov
f r
A TRULY MULTI-LOCAL STRATEGY
INNOVATION
OPERATIONAL EXCELLENCE
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ing
ward
ENTERPRISING MANAGEMENT
in our professions
M
oving forward, faster, and farther. Taking inspiration
from its experiences around the world, the
Group's aim is to achieve excellence and a shared
performance culture.
Moving forward, driven by a desire to excel, to work
together, to satisfy our customers and to reinvent the world,
the individuals who comprise the Group are its source of
energy. Today it is the exchange of experience taking place
everywhere within the Group, coupled with the actions,
creativity and perseverance of each individual, that keep
Lafarge on the move and always one step ahead.
30 Innovation | 34 Operational excellence |
38 A truly multi-local strategy | 42 Enterprising management |
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moving forward
innovation
innovation
is at the heart of our growth strategy
A
t Lafarge, innovating is synonymous with creating long-term
value. It means offering our customers and partners reliable
and economical products, systems and solutions. It means
meeting new needs. Innovating is improving what already
exists and inventing new concepts.
To be successful, we innovate at every stage of our activity, not only in
our product and service ranges, but also in our organizational structure
and our industrial and managerial processes. We are always focused on
anchoring our efforts in a given economic, social and geographical
environment. Our customers' hopes, the dreams of architects, as well
as market expectations, shape our strategy.
For us, innovation is a state of mind, a driving force, a culture of progress
that allows us to be one step ahead: inventing tomorrow today.
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GILLES CHANVILLARD,
Research Director
in structured materials
at the LCR (Lafarge
Research Centre),
An innovative organization
that fosters innovation
T
o foster innovation, Lafarge has
“We combine fundamental research with
established high-tech centers
development projects to create new
dedicated
materials as well as new, constructive
to
fundamental
10
research.
solutions.” For example, lightweight
A specialist in lightweight concretes and
concretes “are easier to use on job sites
leader of a team of engineers and
than cellular concretes” and offer
technicians studying the properties of
improved energy performance for
hardened materials, Gilles Chanvillard
buildings. Specialists in aggregates are
applications filed by the
heads the ‘mechanics and modeling’ group
working on this project, as are experts
Lafarge Research Center
of the structured materials unit at the LCR
in the formulation of binders and air-
in 2005, versus 3 in 2004
(Lafarge Research Center), located in
entraining admixtures. “Each project is
and 2 in 2003.
L’Isle-d’Abeau, France.
supervised by a scientific steering
“Our institute is undoubtedly the only one
committee representing the research
of its kind in the world. It brings together
center’s full spectrum of expertise, to
in one location chemists, physicists,
facilitate the exchange of information,”
powder specialists, blend formulators
Gilles Chanvillard adds. “Ideas are
and rheologists – all the scientific expertise
collected in a knowledge database that
needed to develop a solid understanding
can be accessed by all, in a spirit of sharing
of materials,” says Gilles Chanvillard.
innovation.”
The number of priority patent
■
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moving forward
innovation
More than 80 years of
competition and Lafarge invents
the ideal plasterboard
S
ince 1922, gypsum companies
four plants in competition against each
worldwide have been trying to
other," Dominique Ribas continues. "Rather,
produce plasterboard with four
the idea was to promote a collective
tapered edges to facilitate installation
endeavor, to share the discoveries and
and do away with overlap at the joins.
accelerate the search for a solution." The
"More than 30 patents have been filed
method worked. In the end, the Saint-
around the world, but none resulted in
Loubes plant found the solution, giving
industrial production – until now," says
rise to Signa™, a plasterboard particularly
Dominique Ribas, head of product
adapted to ceilings and very high walls.
development at the Lafarge Gypsum
"It's a simple, reliable, patentable, and easily
technique development center in Avignon,
transferable process, which represents
France. For four years, the Group enlisted
a modest investment," Dominique Ribas
four of its plants in the project – those in
explains. Signa™ has since been launched
Saint-Loubès, France, Corfinio, Italy,
internationally, and the installers who use
Songkhla, Thailand, and Dalsan, Turkey.
it have been gaining precious time and
"It was never a question of putting these
improving quality and aesthetics.
DOMINIQUE RIBAS,
Gypsum Product
Development Director
■
New low pitch
roofing system pairs
aesthetics with
rainproof technology
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Avancrete,
the cement for
saving time
I
nvented by Lafarge Malayan Cement
Senior Manager Product Development.
(LMC), Avancrete bagged cement was
“These advantages help boost construction
designed to meet specific customers’
site productivity.” Moreover, a 40kg bag
expectations. “For a year, we worked
of Avancrete can produce the same
closely with end users, especially masons
quantity of concrete as a 50kg bag of
who were likely to use the product,”
ordinary cement. The product's qualities
explains Wai-Siaw Yeow, Senior VP
are such that it was launched at a price
Marketing. When Avancrete was launched
20% higher than competing products.
in August 2005, workshops were
Working with Lafarge Asia Technical
organized to demonstrate the product to
Center, the LMC teams are opening
building material distributors and
Malaysia up to the development of other
construction companies. “Avancrete is
new products and transferring Avancrete
easy to mix, easier to work and sets more
to other countries.
■
quickly,” points out Soo Thong-Phor,
O
“
ur new Low Pitch system is a
quick and easy to install,” Guido Franzini
great innovation which we
explains. “We developed this comprehensive
launched successfully last year”,
solution with support from roofing
affirms Guido Franzini, Director of
prefabricators – it is composed of special
Marketing & Sales at Lafarge Roofing in
low-pitch tiles, insulation, ventilation
Italy. “The key to its success is the Coppo
and skylights – and followed it with
Big roof tile, which is larger than a normal
specific trainings for installers. The result
tile and equipped with innovative rainbar
is a high-quality roof system with greatly
technology. The system’s high deluge
improved aesthetics that has been rapidly
performance allows it to be used for roofs
adopted by the market.”
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with a pitch of as little as 6° . It is also
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moving forward
operational excellence
Full speed
ahead
A
t Lafarge, operational excellence is not a matter for experts –
it is everyone’s concern. It affects every aspect of our business
and is based on a single principle: it is the men and women of
the Group who allow it to be successfull. Operational excellence
includes the safety of individuals – one of the Group’s fundamental values –
as well as the reliability of our industrial processes and our ability to
build customer loyalty, create value and protect the environment.
Performance programs have been launched in each one of our activities
to develop a common language, as well as common performance indicators
for Business Units in similar activities. This provides our employees with
the means to compare their performance with others, and to adopt the best
practices. Performance programs are underway in all countries.
Today, knowledge transfers are increasing in every area, from manufacturing
to marketing, sales and product development.
The aim? To lower our costs, boost productivity gains, increase competitiveness, enhance customer service, promote innovation…in nutshell, to achieve
excellence!
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BRUCE MAJOR,
Plant Manager,
Silver Grove
Employee motivation:
the key to performance
T
he new Silver Grove plant in
our competitors are doing and the general
the United States produces
business environment. Key performance
%
20
80 million square meters of
indicators for the plant are defined and
plasterboard per year. Performance has
shared with everyone, and used as daily
steadily improved at the plant over the
targets for all teams.”
last few years with machine efficiency
“We have strived to improve performance
rising from 82% to 90% and annual
in every area, believing that there should
productivity increase
output from 67 to 80 million square
be no compromise. It is our aim to make
since 2003.
meters since 2003.
a quality product, efficiently in a safe and
Since the plant’s inauguration in 2000,
environmentally sound manner.”
the plant team has worked ceaselessly to
Having worked over three years without
improve performance in all areas of board
a lost-time injuries, with a string of
manufacture
and
Environmental awards and a daily
environmental issues all the way to
productivity increase of 25% since 2003,
distribution of the finished product.
the mobilization around key performance
“We have worked hard at communicating
indicators by all employees and partners
our targets and results with all employees
is clearly paying off.
and partners and sharing our successes
“We are now ready to meet a new
as we try to involve everyone at the plant
challenge: doubling production capacity
in improving our performance,” explains
with the construction of a second high
Bruce Major, Plant Manager.
speed line, while maintaining our focus
“Performance in every area is shared with
on continuing to improve results,”
our operating teams, and we try to keep
concludes Bruce Major.
from
safety
The Silver Grove plant’s
■
everyone informed of market trends, how
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moving forward
operational excellence
In Germany, respecting
the environment is profitable
L
afarge's German plants offer
new proof that sustainable
development and performance
can go hand in hand. The plants have
continued to diversify the fuels used in
their kilns with increasingly stronger
demands.
"To
reduce
our
coal
consumption, we burn waste, such as
plastics, solvents or tires," explains Gilles
Bourrain, Industrial Director for Lafarge
in Germany. "In a single year, we increased
the use of such fuels by 20%, sharply
lowering our fossil fuel needs and
contributing to limiting our impact on
the environment and the greenhouse
effect." This new and more ecological
production process has no detrimental
impact on cement quality. A rigorous
control procedure was implemented for
the new fuels. "They are checked when
they arrive at the plant and we monitor
their combustion during the production
process. Of course, we constantly test
the cement produced." All this also
presents an economic interest. "The new
fuels saved us €5 million over a year,"
■
says Gilles Bourrain.
n
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Security at the heart
of overall
performance
Quality and more
economical cement to meet
conditions in East Africa
I
n Kenya, as in Uganda, cement sales
but our production wasn't sufficient," notes
rose by 11% from 2004 to 2005. To
Henri Nicot, Industrial Director of Lafarge
supply this market with equal quality
in East Africa. "To meet our market’s needs
cement, Lafarge increased the portion of
while keeping costs in check and remaining
pozzolan used in its cement production
competitive, we now use a mix of 35%
process, while grinding it more finely to
pozzolan and 60% clinker, compared with
maintain resistance. These volcanic rocks
27% pozzolan previously." This choice has
reduce the portion of clinker* needed in
allowed Lafarge to realize significant
cement and thereby overcome difficulties
savings. Each additional percentage point
in procuring ample supplies of limestone,
of pozzolan used represents a savings of
which is a limited resource in the region.
€1.3 million in East Africa.
■
They also help reduce the overall level of
greenhouse gas emissions of the related
plants. "Until now, we produced all the
* Clinker is produced by heating limestone to
1,400°C in cement plant kilns.
clinker needed to make cement ourselves,
I
n Honduras, when Lafarge acquired
began working to change attitudes through
the Piedras Azules cement plant in
to communication and by involving
1998, the plant's new management
management. "We launched a poster
was faced with an absence of safety
campaign, conducted cross-departmental
regulations. "The problems arose primarily
audits and made safety part of the
from the behavior of the employees and
supervisors' performance goals," explains
the previous management team, who
Alvaro Lorenz, former Industrial Director
didn't pay much attention to safety,"
for Honduras. The results were fast in
says Xavier Blondot, CEO of Lafarge
coming: Since 2003, the number of
Honduras. Once infrastructure was
lost time injuries has fallen 80%, a
brought up to Group standards, Lafarge
spectacular performance.
■
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moving forward
a truly multi-local strategy
benefits
the
of a multi-local business model
O
ur business has always been anchored in two areas local and
global. It is local, because our products are produced where
they are used. Working locally means that we are able to adapt
to the characteristics of local construction markets, which by
nature have a strong cultural dimension, while developing very close
relationships with customers.
Global, because the Group’s cohesion guarantees the success of its longterm development strategies. With its shared vision, financial solidity,
international image and unique organization and management of human
resources, the Group provides us with unparalleled strength in terms of
research and innovation, and creates the foundations for sharing experience.
As a global leader in very local businesses, we mobilize all our teams around
a management style that combines initiatives and reactivity on the ground
with global expertise. With the Group’s cohesion accelerating the transfer
of experience, we strive on all fronts to realize our full potential to advance
and create more value.
We mobilize the talents and energies of all our employees with one goal
in mind: ensure the Group’s leadership in all its local lines of business,
worldwide. This strategy is particularly clear in China, where Lafarge reached
a major milestone in 2005.
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China's new number two
in cement has ambition
I
n August 2005, Lafarge's development
200 million people and is one of the
in China took a major step forward.
country's fastest growing regions.
By forging an alliance with the
Lafarge's development in China illustrates
Shui On Group, Lafarge considerably
the strength of the Group's multi-local
strengthened its positions in a fast
model. It combines all of the following:
growing market. China now accounts for
the boldness of entering a new and
45% of the world cement market in terms
unfamiliar market; prepation training
of volume, with growth of 9% per year for
under fierce competitive conditions;
the past 10 years.
perseverance regarding costs to achieve
The number of Lafarge
a cost price of $12 per metric ton of
employees in China.
This growth has given rise to Lafarge
cement; the creativity and energy
Shui On Cement, China's second-largest
necessary to invent new, very low cost
cement producer and the leading
investment methods; the transfer of
producer in Southwestern China. This
experience to train Chinese teams;
region, which includes the Sichuan,
and,
Chongqing,
competitors and a development still
Yunnan,
and
Guizhou
provinces, is home to more than
finally,
full of promise.
the
edge
over
9,000
our
■
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moving forward
a truly multi-local strategy
How do you create
real Chinese know-how?
I
n 2005, nearly 7,000 employees
“Our biggest challenge is to transform our
joined Lafarge in China. Integrating
employees’ frame of mind,” esteems Lu
these new Chinese employees requires
Liang, head of business activities in the
a specially tailored human resources
Chongqing Municipality. “This requires
policy. “Training and coaching are the keys
a lot of time and effort. We need our new
to a successful integration, which must
employees to trust the company. For this,
be carried out quickly and efficiently,”
we have to show that our company cares
explains Frankie Lim, Integration Director
about its employees. We have to do what
for Lafarge in China. “First, we must initiate
we promise.”
these newcomers to Lafarge’s performance
Yet it is an effort worth making, given
culture, which is based on indicators that
the economic stakes at play. “We know
are shared by all. We must also get them
from experience,” adds Frankie Lim, “that
to adopt our values, especially in terms
with successful integration, we gain in
of safety.”
terms of reliability and profitability, while
FRANKIE LIM,
Integration
Director
for Lafarge
in China
retaining our most talented employees.”
■
Chongqing 2, the first 100%
Chinese cement plant
A
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first! The new production line
quality, the environment – we respected
suppliers. In the end, the investment
at Chongqing, inaugurated in
all of the Group’s standards,” enthuses
came to only 40 dollars a ton, three times
November 2005, was entirely
the
This
less than usual. “The low-cost of the plant
built using Chinese equipment. Local
performance was made possible by the
in no way diminishes its performance,”
expertise and technology reduced the
technological maturity of the Chinese
affirms Wang Qing. This model started
construction period to sixteen months,
cement industry, and by two years of
to be exported to other regions.
down from the usual twenty-four. “Safety,
close collaboration with equipment
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director,
Wang
Qing.
■
Roofing China
is on the right path
O
TIFIC (On Time, In Full, Invoiced
planning and stock management, offering
Correctly) is a quality indicator
a shorter response time and a new
developed by the Gypsum
customer-oriented corporate culture.”
Business five years ago and introduced
According to Lance Xu, some regions have
to Lafarge Roofing Systems in China (LRSC)
already made substantial progress in terms
in 2005. The Chinese Unit thus benefits
of customer service. The current goal, he
from the cumulative OTIFIC experience
adds, is “to ensure that the best practices
of other Business Units of the Group. The
that have been identified are circulated
introduction of OTIFIC, which measures
widely and rapidly in all regions of China.”
the overall performance along the customer
“In a highly competitive market,” explains
chain,
the
Stephane Lecat, CEO of LRSC, “we expect
implementation of customer services “in
OTIFIC will contribute to a gain in market
each region and at the national level,” says
share and a higher price premium,
Lance Xu, National Supply Chain Manager
demonstrating our ability to create value
of Roofing in China. “This service integrates
for our customers while increasing our
other functions like logistics, production
profit at the same time.”
was
accompanied
by
LANCE XU,
National Supply Chain Manager,
Lafarge Roofing Systems China Ltd.
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moving forward
enterprising management
A more
effective
organization
O
ver the last few years, Lafarge has undergone a number of
major changes that have profoundly transformed the Group
and propelled it to the rank of world leader in building materials.
The Group has reaffirmed its goal to become the undisputed
leader by achieving operational excellence in all four of its businesses
and in all its markets.
At the heart of this objective are the Group's employees who must rise to
the challenges of efficiency, speed and value creation, both on an individual
level and collectively. It is a matter of attitude, an attitude that the organization
must foster and promote.
How can we make the best of the Group's global and local dimensions
and its diversity?
By promoting the sharing of resources and knowledge at all levels of the
organization, by encouraging local initiatives and exchanges of experience,
and by accelerating decision-making processes and simplifying our
structure. The organizational changes introduced in the first half of
2006 are moving in that direction. The key words are simplicity, reactivity,
efficiency, and responsibility.
Lafarge has confirmed the fundamental choice of being an integrated group
organized by business line.
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SARA RAVELLA,
Group Vice-President,
Development,
Organization
and Training
Train me a manager
L
afarge University was created in
150 top managers, 90 took a training
2004, as part of the Leader for
course that year”. Three week-long Learning
Tomorrow (LFT) project. Beyond
Expeditions were organized in the U.S.,
of
allowing senior executives to discover the
individuals, its main goal is to help evolve
practices of other companies, especially
the Group's management style. To that
in the area of customer orientation.
end, Lafarge University offers inter-
“Three Learning Forums were also held
divisional training through 12 programs
so that managers could exchange their
that give participants an active role in
experiences in improving safety and
their training. It focuses on the Group's
developing
leaders and future leaders, although all
employees,” adds Sara Ravella. The
managers follow a common path to learn
training programs have borne fruit. By
the corporate culture. “In 2005, priority
the end of 2005, most of the participants
was given to developing programs specific
said they had launched concrete actions
to for senior executives,” says Sara Ravella,
at their Business Units, and the results
Group
should be forthcoming soon.
enhancing
the
development
Vice-President,
Development,
and
mobilizing
their
2,000
The number of managers trained
by Lafarge University in 2005.
48 training sessions were held,
doubling the number of participants
and sessions in 2004.
■
Organization and Training. “Among our
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moving forward
enterprising management
Knowledge transfer:
Europe inspires
Chilean managers
To optimize deliveries to its customers,
we discovered the different transport
managed to define our own outsourcing
Premix, a readymix Lafarge subsidiary
outsourcing practices that had been
model. The benefit for Lafarge is a saving
in Chile, benefited from the experiences
created in France and the UK. A Chilean
of 1 euro per m3 produced (meaning a
of the Group’s French and British
team went to Europe to gauge whether
10% reduction in cost) and higher
Business Units. “Historically, our plants
the system could be transferred back
productivity : drivers bought their own
owned their trucks and employed
home,” said Erico Zursiedel. Once they
trucks and went into business for
drivers who were paid by the hour. As
were sure it would work, the project was
themselves, to become truly independent
a result, delivery times were not always
set up, and British and French managers
transporters
respected,” observes Erico Zursiedel,
provided their Chilean colleagues with
satisfaction,” adds Erico Zursiedel. Today,
General Manager of Premix. “When
lots of practical advise. “Through
delivery delays is a matter of the past.
Premix was integrated within the Group,
meetings and phone conversations, we
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targeting
customer
Co-processing
at Lafarge
North America
T
o reduce supply costs: The
more than 13% of its energy from
management team at Lafarge
alternative sources, significantly reducing
North
has
its fuel bill while rendering a service to
developed an especially innovative co-
society and the environment in the
processing offer, partly replacing its
process,” explains Thomas Spannagl, LNA
traditional fuels – such as oil, natural gas
Vice-President of Resource Recovery.
or coal – with alternative energy sources
LNA develops co-processing as a full-
such as tires, solvents, or solid wastes
fledged waste service business. “To get
like plastic. Installed in most of the 24
a better understanding of potential
plants, this system really came to the fore
customers, we are studying the industrial
the plants are the key drivers for its
in 2005. Fuel purchases account for more
sectors that generate the most waste and
implementation, supported by the North
than 20% of production costs. “Co-
will continue to develop direct relations
American Technical Center (CTS), the
processing of wastes allows us to maintain
with them.”
waste management subsidiary Systech
our competitiveness. We process these
To implement this project, LNA relies on
and a dedicated Resource Recovery team,”
wastes into alternative fuels to be burned
its own human resources. “As co-processing
notes Thomas Spannagl.
in out cement kilns. In 2005, LNA obtained
is a core activity of the Cement Business,
America
(LNA)
THOMAS SPANNAGL, LNA Vice President of Resource Recovery
■
Integration, teamwork
in progress in Ecuador
I
“
PIERRE DELEPLANQUE,
CEO Lafarge Selva Alegre, Ecuador
arrived in Ecuador in early 2005, to
force. A year later, I would say that we
lead the integration of Cementos
have already accomplished 60% of the
Selva Alegre. I didn't know this
work. The change was carried out without
country and found myself confronted
interrupting business. In 2005, the
with enormous expectations from the
number of accidents fell dramatically,
teams. It was a blank page waiting to be
and we increased sales as well as
written on… With an integration team
operating income. In the beginning, we
of managers from the Cement activity,
dedicated a lot of time to meeting with
the Latin America region and the technical
each team, but today these teams are
center, we focused on two areas:
mobilized around the same shared
performance and corporate culture with
objectives."
■
changes in safety practices as the driving
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contri
T
o design and manufacture building materials is
to contribute to the legitimate expectations of
people everywhere for housing, mobility, health,
and education, as well as for infrastructure projects
essential to economic growth and social progress. Is
there any better profession?
Attentive to the ever-changing needs of its clients,
Lafarge continuously innovates to ensure that, everywhere in the world, its materials contribute to improving the quality of life and to building a more sustainable
world for all.
48 Banda Aceh, Indonesia | 50 Tetouan, Morocco |
52 Rion-Antirion, Greece | 54 Harbin, China |
56 Woodmead, South Africa | 58 Radauti, Romania |
60 Paris, France | 62 New York, U.S.A. |
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Indonesia
Banda Aceh
Rebuilding
after the tsunami
After meeting emergency needs, Lafarge is undertaking long-term efforts
to rebuild homes, clinics, schools and mosques.
Every afternoon, a dozen villagers meet in the offices of Dompet Dhuafa, an Indonesian NGO based in Banda Aceh.
Most lost everything in the tsunami that ravaged coastlines around the Indian Ocean on December 26,
2004, killing 286,000 people. Dompet Dhuafa is working locally with two other NGOs on a Lafarge project
aimed at rebuilding 500 houses in Banda Aceh. “A lot of villagers are still living in tents,” says Ahmad Juwaini,
who leads the Dompet Dhuafa programs. “Every day, they inquire about how the work is advancing. At the end
of December 2005, 30 houses were completed, 70 were nearly finished, and numerous others were started.”
LONG-TERM RECONSTRUCTION EFFORTS
The project is part of a vast program led by Lafarge to assist in the rebuilding of the Banda Aceh region, one of
the areas hardest hit by the tsunami. The Group has set itself two priorities: restore activity at the Lafarge PT Semen
Andalas cement plant, two-thirds of which was destroyed, and help the recovery efforts of local communities.
“We have been present in Indonesia for a long time," states Tom Ehrhart, CEO of Lafarge Indonesia. "Beyond emergency
assistance, we wanted to support the affected populations and continue to contribute to the economic development
of the country, which has enormous reconstruction needs. The Group freed up $2.5 million in emergency aid, in
addition to the €650,000 in donations made by Lafarge employees from around the world, and €5 million for
reconstruction efforts.”
DAILY PROGRESS
As the bell rings in the courtyard of a small school, children with brand new school bags lined up under the watchful
eyes of their schoolteachers. “To help the youngsters return to 'normal' life, Lafarge renovated four schools and
provided 2,500 children with school supplies,” Tom Ehrhart explains. The Group also restored four mosques –
a focal point of community life in Indonesia – and is currently renovating three others. Lastly, a mobile clinic
financed by employee donations has been making two rounds each week in neighboring villages since July 2005.
Some 2,300 persons have already benefited from its care. A second medical team will soon boost the number of
rounds.
LEARNING A NEW PROFESSION THROUGH JOB TRAINING
Since the tsunami, it's no longer possible to practice certain professions such as fishing or farming. At the
same time, the reconstruction projects create numerous opportunities, but professional skills are lacking. To
help the inhabitants of Banda Aceh find work, Lafarge is financing a €100,000 program to train people in the
building, restoration and craftsman trades. Some 300 people took part in the program in 2005.
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Morocco
Tetouan
Sustainable wind power churns
in Morocco
In the Tetouan hills in the North of Morocco, a dozen wind turbines spin
in the hot Sahara wind. Since the spring of 2005, they have been generating electricity
for the new Lafarge cement plant located below.
The idea for a new plant dates back to 2000. The old plant, once surrounded by pastures in open country, was
now too close to the center of town and too far from the quarries. It had become obsolete and needed to be upgraded
to optimize production costs and meet new demand. According to economists, demand in the Moroccan cement
market was expected to climb 200% by 2015. At the same time, scientists were alerting the public to global warming,
estimating that the Earth's temperature would rise between 1.4°C and 5.6°C in the century ahead. For Lafarge, the
Tetouan project was a way to combine of economic development and environmental preservation.
GREEN CEMENT AND THE UNITED NATIONS
“We allocated 15% of the investment to preserve the environment,” says Amzaï Abdel Ghali, Technical Director of
Lafarge Maroc, who coordinated the project. “We were able to take advantage of natural conditions and particularly
the site's tremendous exposure to wind, which averages 9 meters per second.”
In terms of workforce, a redeployment plan allowed the former plant's employees to find jobs, or even to create
new jobs locally. Furthermore, the local populations were directly involved in the project. “We even organized a
field trip to a neighboring wind park,” explains Jean-Marie Schmitz, CEO of Lafarge Maroc. “That way, they were
able to see for themselves the visual effect and the very low noise impact.”
Today, perched on hillcrests and standing 44 meters high, the 12 Tetouan wind turbines generate 10 megawatts
of power, providing half of the plant's electricity needs. They also represent a successful marriage of
ecology and economy. The Moroccan plant, the first of its kind to possess its own wind farm, was recognized
by the United Nations and acknowledged by the Clean Development Mechanism (CDM) Executive Committee
in September 2005. The CDM, created by the Kyoto Protocol, allows industrialized countries to offset their
greenhouse gas emissions by investing in clean projects in developing countries. The winds blowing over
Tetouan have kept 30,000 metric tons of CO 2 from being released into the air. It is almost as if two million
trees have been planted.
A SUSTAINABLE PARTNERSHIP WITH WWF TO PROTECT THE ENVIRONMENT
June 21, 2005 – Lafarge and WWF renewed their partnership for a period of three years. Illustrated by the shared
message “Two worlds, one planet”, the new agreement focuses on four areas: favoring biodiversity, combatting
global warming, promoting sustainable construction, and controlling persistent pollutants. In addition, everything
is in place to develop local partnerships between the activities of Lafarge and WWF, to efficiently materialize the
agreement on the ground.
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Greece
Rion-Antirion
The Harilaos Trikoupis bridge:
“Connecting people”
2,800 meters! That’s the length of the Harilaos Trikoupis bridge,
the longest suspension bridge ever built. This majestic structure links Peloponnesus
with western mainland Greece.
Beyond its technical prowess, the bridge symbolizes the openness and fraternity of Rion and Antirion, the two
cities it now links together. “This bridge has changed our daily life,” affirms George Kolovos, mayor of Antirion
for the past four years, a town of 2,400 inhabitants. “To begin with, it allows the two towns to exchange ideas,
practices and experiences. Moreover, by making travel easier, it creates new job opportunities.” His comments were
echoed in Rion, a city with 13,000 inhabitants. “We can now anticipate real economic development throughout
the entire region,” enthuses Vassilis Zervas, Rion’s mayor for the past 12 years. “The bridge will boost the
economy of both cities. It also offers the people living nearby numerous advantages, saving them time and simplifying
their lives. I walk across the bridge every evening. It’s good for my health, and what’s more, I meet people and
develop new friendships. I find the bridge inspiring… especially in bad weather when the wind is howling!”
WHEN DREAMS COME TRUE
In Rion and Antirion, everyone agrees that people have dreamed of this bridge for several generations. “We have
always hoped for a bridge,” says George Antonakakis, chairman of the Rion cultural association created in 1973.
“I hope it will lead to closer ties between the two cities’ associations, and make it easier to organize joint events.
We still need to make more of an effort, but I am confident in the future. The bridge already brings people
together. It’s a real attraction, and one that inspires artists. Culturally, it represents a wonderful opportunity.”
EFFORTS TO MATCH A GREAT PROJECT
Lafarge supplied all of the aggregates used in building the bridge. Between September 1999 and August 2004,
750,000 tons of aggregates were transported from the Araxos quarry to the bridge site. High-performance
aggregates were required to guarantee an extremely durable structure. As a result, the bridge can withstand
250km/h winds, a collision with an 180,000-ton oil tanker, and an earthquake measuring up to magnitude 7 on
the Richter scale!
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China
Harbin
With silent walls,
students can concentrate
The library of Harbin University is a modern complex full of life.
Thanks to Lafarge materials, particularly the ExSound Acoustic Plasterboard system, students
can devote themselves to their studies without being distracted by exterior noise.
“The first of its kind in Northeast China!” exclaims Cao Shihong, an architect in Harbin. The 25,000 m2 library
of the Northeast China Agricultural University has reading rooms, an auditorium, multimedia centers, bookstores,
coffee shops, and more. The building proudly melds aesthetics with practical considerations, modern conveniences
and ecological concerns. “A new symbol of our university,” affirms Wang Xianbin, head of the library.
“THE CHOICE OF MATERIALS PLAYS A KEY ROLE.”
“I selected materials based on my previous experiences,” explains Cao Shihong. “I looked at quality and technology.
I think I made the right choice.” He admits that he is particularly proud of the use of Lafarge sound-reduction
materials, especially the ExSound Acoustic Plasterboard system used in the walls and ceiling of the auditorium.
Noise was a major issue, and for good reason: the university is located only 30 meters from a train line, 400 meters
from a major roadway and close to a warehouse. Trains and trucks circulate 24 hours a day, and the noise is
very disruptive for students. In certain study halls, some students wear headphones to try to block out the
noise. Wang Yuanyuan, a veterinarian student, appreciates the university’s soundproofing efforts. “I really like
the new library. It’s big, modern and chic. The calm, pleasant atmosphere really helps me concentrate on my
studies.” Not surprisingly, the new facility is popular with students. “We have to queue in front of the library if
we want to find a place to study”, continues Wang Yuanyuan. “If only more classrooms could be built with integrated
soundproofing!”
EXSOUND ACOUSTIC PLASTERBOARD – A SILENT REVOLUTION
Distributed in China by Lafarge Gypsum Shanghai, ExSound Acoustic Plasterboard system is the Chinese version
of the Pregybel system developed by Lafarge. Its advantages: high performance acoustics and a perfect finish,
for a one-piece ceiling with a hidden support structure. ExSound Acoustic Plasterboard system offers new horizons
for Chinese architects.
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South Africa
Woodmead
Prevention, testing, treatment:
Lafarge’s therapy
Since the early 1990s, HIV/Aids has ravaged South Africa. With the association Care,
Lafarge has developed a complete program of prevention, screening and treatment.
Despite some cultural resistance, the results are there. It is essential to continue.
Thuli Xaba always carries a pack of condoms in her pocket. Several times a week, she visits colleagues in their
offices to talk about HIV/Aids. Thuli is a peer educator, one of 70 volunteers among Lafarge employees in South
Africa who provide straight talk about Aids in complete confidentiality to the Group’s 2,400 employees in the
country. She uses the national campaign’s ABC slogan: Abstain, Be faithful, Condomize. Yet her task is a hard
one. “It takes months of patience before people trust me and understand,” says the educator.
TREATING THE DISEASE, RAPIDLY AND DEFINITIVELY
Lafarge decided to fight against this pandemic in 2000, when Group executives were alerted to the scope of the
country’s devastating human tragedy. In South Africa, over 6 million people are infected with HIV. The country
holds the infamous record for the world’s highest number of HIV positive individuals: an estimated 21% of the
adult population is HIV positive. Every year, the country loses 5% of its workforce, and in such conditions there
is no reason why Lafarge should be spared. The Group had to fight this calamity, rapidly and definitively. In
partnership with the NGOs Care and Lifeworks, the Group has set up a complete and ambitious program, including
employee awareness, free testing and treatment. To maintain confidentiality, Lafarge outsources the treatments
and medical care. “In our country, people have great fear of being dismissed,” explains Thuli Xaba. The Group
relies on Lifeworks to provide counseling, testing and management of medical care. “We have three objectives,”
explains Sean Jelley of the Lifeworks program: “To offer testing for HIV, to prevent infection, and to extend and
improve the lives of our patients.”
ENCOURAGING RESULTS
Today, thanks to educators like Thuli and the program as a whole, 60% of Lafarge employees in South Africa have
accepted to be tested for HIV/Aids. Less than 8% of them are HIV positive, a very encouraging result compared
with the prevalence of HIV at national level. 62 patients are receiving medical treatments financed by Lafarge.
Although this program is expensive – €1.1 million budget is planned for the next five years – it is much less
costly than HIV/Aids’ impacts. Or the priceless value of life.
ON ALERT FOR BIRD FLU
The Group is taking the threat of H5N1 virus seriously. Actions have been taken to reinforce vigilance and
our ability to respond rapidly in the event of a pandemic. The Group regularly reminds its employees of the
basic rules to observe. In association with SOS International, Lafarge’s human resources network has been
activated in the 76 countries it is implemented in, offering weekly conference calls, a newsletter and a hotline
available 24 hours a day, as well as on-site drills.
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Radauti
Romania
Volunteer builders
for Romania
Radauti, Northern Romania. A short walk from the town center,
a new neighborhood is springing up amidst the fields. Some twenty plain but pleasant houses line
a paved street that only yesterday was a simple dirt path.
Today, it is a whole new residential area built in the name of solidarity. A closer look…
It is April 2005, at the Lafarge Group’s head office in Paris, rue des Belles-Feuilles. An e-mail is blinking in all the
inboxes: “As part of our partnership with Habitat for Humanity, we are seeking volunteers to participate in a
mission to build houses in Romania.” In Maïta’s office, the appeal was welcomed with open arms: “Between the
ages 18 and 20, I participated in several humanitarian missions, so I loved the idea of renewing this experience
as part of my work…”
INCREASING ACCESS TO DECENT HOUSING
A few months later, eleven volunteers left Paris for Radauti. Human resources, marketing, finance…each member
of the team worked in a different department in France. Once in Romania, they all donned helmets and coveralls
and went to work. “We didn’t really know what we were getting into,” admits Sophie. “We learned on the job.”
Marie-Claude was taught how to install fiberglass insulation and finish plasterboard joints. Sylvaine specialized
in sanding. Stéphane and Damien, the two men on the team, were given the more strenuous tasks: framing and
roofing… Working under the direction of local Lafarge teams, the eleven Group volunteers were also able to meet
the future homeowners, who were participating as well in the construction work. In meeting these families, they
were able to learn about daily living conditions. “Our previous apartment did not even have hot water. To live in
a more comfortable, functional home has always been our dream,” said Danut and Lilian, who are now happy
homeowners. Habitat for Humanity specializes in making this kind of dream come true. “Our goal is to help
low-income families gain access to decent housing. Since 1976, we have built nearly 200,000 homes in over
100 countries. We would not be able to accomplish our work without solid partners like Lafarge,” insists
Don Hasczyn, Vice-President of Habitat for Humanity Europe.
Back in France, Maïta says: “We’re delighted to have made a small contribution to the project!” What’s more, the
team’s efforts left their mark: one of the houses was given a funny name – Lafarge.
A GLOBAL PARTNERSHIP WITH HABITAT FOR HUMANITY INTERNATIONAL
January 10, 2005 – Lafarge signed a partnership agreement with Habitat for Humanity International, thus
adding a further dimension to the local cooperative efforts already initiated by Business Units over the past several
years. Lafarge is committed to working with the NGO in 25 countries through 2010 – providing volunteers to build
houses, contributing building materials and offering financial support.
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contributing
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France
Paris
Hypergreen: the tower building
that captures the sunlight
Architect Jacques Ferrier and Lafarge have created Hypergreen,
a tower building concept that fully respects the environment.
Designed for mega-cities with rampant demographics, Hypergreen generates
a large part of the energy necessary to cover its own needs.
Jacques Ferrier brought the project to life in his office, in Paris’ 13th arrondissement where he works surrounded
by models and screens showing CIG images and 3-D maps.
AT THE HEART OF BUILDING MATERIALS LIES MEANING
Since 2001, talented engineer and architect Jacques Ferrier has employed a research team fully dedicated to
sustainable development issues: “Architecture in the twenty-first century can have no other focus than the
environment. We must work to diminish the overall impact of buildings.” Jacques Ferrier draws on existing material,
which acquires meaning as it is used in the buildings he designs. He was bound to link up with Lafarge. A shared
environmental awareness directed the creation of Hypergreen, an exemplary concept of sustainable development
for the world’s mega-cities. For the first time in the history of mankind, half the planet will live in an urban environment
in 2006. New-generation high-rises must meet the requirements of highly populated cities where land is scarce
and pollution rampant. “Hypergreen is a new architectural approach that is truly focused on sustainable development
issues. Positioned to better capture the sunlight, Hypergreen has turned tower buildings into tools of sustainable
urban development that are not only additions to a city but also genuine improvements.”
A HIGH-VALUE PARTNERSHIP
The project started by Lafarge and Jacques Ferrier in late 2004 has involved many technical exchanges among
the architect’s teams, the industrial Group’s engineers and consultants specialized in environmental issues. Presented
at an architecture symposium in Shanghai, China, in December 2005 and at the MIPIM fair in France in March
2006, Hypergreen has already elicited a great deal of interest.
A CHOICE OF INNOVATIVE MATERIAL
Positioned to capitalize on its orientation, the Hypergreen tower draws on climate engineering breakthroughs
and makes the best of building techniques and components. As a result, it is thrifty, safe and recyclable. Lafarge’s
innovative material, such as the ultra-high performance Ductal® concrete used for the grid skin façade, helps
save energy and adds to the building's flexibility.
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contributing
a loft
GREEN MAD ARMCHAIR
made of Ductal®
concrete by
Michel Pagliosa
and Jérémy Bataillou
from l’Atelier du Béton
is material for emotions
A
harmony of lines, colors and materials, here the space is
balanced, novel, pleasing to the eye as well as to the ear.
The light is soft. The loft is permeated with life…
and emotions, too!
THE GARDENING TABLE made of Ductal® concrete by Marie-Christine
and Mario Silva from the Béton Concept atelier
Leaving behind the city streets, the doors to the building swing gently open,
revealing a quiet, light-filled hall. The elevator soars silently to the 30th floor.
A muffled hallway…a door…and at last the loft in all its splendor, with great glass
windows commanding a view of the city below.
The door is no sooner closed than silence pervades. The room is spacious, white.
Harmony mingles with ingeniousness. The concrete furniture makes no secret
of its novelty. In one corner, a sofa with smooth lines and soft cushions inspires
THE DANCING
BOOK SHELF
made of ultra highperformance Ductal®
concrete by
Francisco Passaniti
an irresistible urge to pause…to settle down with a glass, a snack and a book. The
eye is drawn to the dancing bookshelf, a centerpiece of pure design fulfilling its
function with a whimsical flourish. What will it be – a novel, poetry or a traveler’s tale?
Furniture can breathe life into space. The table, streamlined, with warm colors and a sylvan touch, hugs the wall
and calls for place settings and a meal, shared round a
timeless, miniature garden. From appetizers to dessert,
the conversation will circle the table.
CUBIC BEDSIDE TABLES
made of Ductal® concrete
by Jean-Michel Ducancelle
of the Compagnie des Arts
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New York
United
States
DECORATIVE
PLASTERBOARDS
with high
acoustic insolation
properties
THE LIGHT BALL
made of Ductal®
concrete by the Atelier
Béton Concept
THE BELUGA BATHTUB AND THE BASIN
made of Ductal® concrete by the Atelier du Béton
On the desk, papers and letters are yearning for a bit of attention.
But this evening, it’s the bathroom’s modern yet soothing decor
that entices with an invitation to relax. The tub’s graceful curves draw
you in…bath oils, bubbles and scents fill the air. The sink plays a
quieter role, its pure, balanced lines springing directly from an architect’s
drawing board.
Down the hallway, the bedroom. Here, a subtle arrangement with
plasterboard affords some well-deserved intimacy. A luminous sphere
diffuses a filtered light, playing with the cubic forms of the bedside
table. Slip into something comfortable before stepping out onto
the terrace. Artificial lighting plays against the colorful
concrete squares, reflecting red, gray and beige. Honeysuckle
and mint perfume the air. Settle for a moment on a broadbacked, lacework bench. The comforting aroma of coffee
rises from steaming mugs. Words are spoken in hushed voices,
as though reluctant to trouble the bustling crowds in the twinkling
lights below. Look down and watch the city’s beating heart.
One final sensation, before turning in.
WHITE BENCH [ detail ]
made of Ductal® by Olivier Chabaud and Laurent Lévêque,
partners of la Compagnie
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reali
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zing
Lafarge’s unique potential
I
n February 2006, Bruno Lafont,
CEO of Lafarge since January 1,
presented his strategic plan for
66 Key figures of the Group |
the Group. What are the main
70 Cement |
objectives of the plan? After a major
74 Aggregates & Concrete |
transformation that the Group has
undergone over the past five years,
76 Roofing |
78 Gypsum |
80 Organization of the Group |
which made it the world leader in
building materials, it is now time to
take full advantage of the considerable
potential of our current portfolio of
assets, to extract all the corresponding
value for our company and our
shareholders.
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key figures
of the Group
RECORD SALES, CURRENT
OPERATING INCOME AND NET
INCOME
We were able to offset sharp increases in
energy and transport costs in most of our
markets through our competitiveness and
capacity to raise sales prices.
In 2005, the Group realized solid results,
although they do not yet reflect the full
extent of Lafarge's potential.
Sales increased by 11% to nearly €16 billion.
Fuelled by growth in our markets and
our innovations, organic growth in sales
totalled 8%.
Sales rose 11% year on year, while cost of
goods sold increased 12%. Energy costs were
up 16%, but we were able to offset the impact
by 2 percentage points through an improved
fuel mix in the Cement business. Our energy
bill increased overall by 14%. In addition, the
energy crisis had a significant indirect impact
on our freight to customer costs and on our
Although the first half was disappointing,
the Group recovered in the second half, with
other variable costs, essentially raw
materials, both of which were up 8%.
current operating income up 17%.
The Roofing business suffered from
For the full year, current operating income
rose 7%. The Cement, Aggregates
& Concrete, and Gypsum businesses all
recorded double-digit growth in current
operating income. The performance in the
persistent softness in the German building
market, which has been in a recession for the
past 12 years, and great price competition,
resulting in a 34% decline in its current
operating income.
emerging markets was particularly strong,
with current operating income up 15%.
The Group's net income grew 5% to
€1.1 billion.
Earnings per share totaled €6.39, up 2%, after
dilution arising from scrip dividend
reinvestment.
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80,000 EMPLOYEES |
€16 BILLION IN SALES |
SALES
BY BUSINESS
PRESENT IN 76 COUNTRIES |
9%
9%
2005 KEY FIGURES
MILLIONS OF EUROS
Sales
2004 (1)
2005
VARIATION
14,436
15,969
+ 11%
Current operating income
2,201
2,357
+ 7%
Net income Group share
1,046
1,096
+ 5%
Earnings per share in euros (2)
€6.26
€6.39
+ 2%
Cash flow from operations
2,148
2,238
+ 4%
+ 4%
Net debt
Operating margin
6,958
7,221
15.2%
14.8%
8.8%
8.5%
€2.40
€2.55
ROCE (at standardized tax rate) (3)
Net dividend in euros (4)
34%
● Cement
● Aggregates & Concrete
● Roofing
● Gypsum
SALES
BY REGION
+ 6%
IFRS
At a 28.6% rate, unchanged since 2003
(3) Average number of shares: 171.5m in 2005, 167.2m in 2004
(4) Subject to AGM approval
48%
2005
(1)
(2)
9%
9%
5%
4%
6%
A SOLID FINANCIAL STRUCTURE
39%
2005
28%
The Group continue to strengthen its financial structure in 2005.
Group cash flow from operations advanced 4% to €2,238 million. Growth was particularly
strong in the second half, totaling 19%.
Gearing improved significantly in 2005, dropping from 70% in 2004 to 59% in 2005,
marking the lowest level since 1996. At the same time, the cash flow to net debt ratio
was stable at 31%.
2006-2008 STRATEGIC PLAN
● Western Europe
● North America
● Central and Eastern Europe
● Mediterranean Basin
● Latin America
● Africa
● Asia / Pacific
We will create value through profitable
revenue growth and better cost control.
"Together with the Executive team, we will
drive our building materials strategy with
discipline, lead the race for innovation and
unlock the full potential of our operations.
We will streamline our organization to
improve efficiency. The reduction in costs
alone should allow us to increase our
It is my priority is to ensure that our
improvements translate into enhanced
returns for our shareholders.
Our strategic plan should translate into a
sustainable 8% yearly average growth in
earnings per share and an improvement in
return on capital employed."
operating margin by 1% by 2008.
This is a minimum.
BRUNO LAFONT, February 23, 2006
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INCREASE IN NET DIVIDEND
PER SHARE
A MAJOR PROGRAM TO BUILD NEW
CAPACITY
The Board of Directors approved Bruno
To accompany the growth of our markets,
Lafont's proposed 6% increase in the dividend
strengthen our positions and contribute to
to €2.55 per share, compared with €2.40
the consolidation of our markets:
per share in 2004. No scrip dividend was
• New cement production lines are being
proposed this year to avoid diluting earnings
built in Mexico, Bangladesh, Morocco, and
per share.
China. The new production is expected to
Both resolutions are subject to shareholders’
come on stream during 2006;
approval at the Annual General Meeting.
• New cement production units have been
announced in South Africa, Zambia and
SARBANES OXLEY CERTIFICATION
Lafarge is one of the first European
companies to comply with Section 404 of the
Sarbanes-Oxley law relating to internal
control. The Group has been in compliance
since December 31, 2005, well ahead of the
December 31, 2006 deadline.
The project involved thousands of employees
around the world in a very short deadline.
The Group took advantage of this project,
which could easily have been viewed as just
another new regulation to implement, to
maximize operating benefits.
Sarbanes Oxley certification attests to the
transparency and reliability of our internal
control and reporting processes. It's an
indication of stronger and more efficient
operating processes as well as a solid
foundation for accelerating the
standardization of those processes.
Finally, it represents a real advantage for a
group built around a multi-local
organizational structure that is decentralized
by nature owing to the local markets in which
our businesses are active.
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Russia. These new capacities are expected
to be operational in 2008;
• The plasterboard plant in Buchanan, New
York, is being upgraded. Furthermore, the
construction of new wallboard production
units has been announced to boost the
Group's total capacity by 25%. These
include doubling production capacity at the
Silver Grove plant in the U.S., and building
new wallboard plants in the U.K., in
Shanghai and Chongqing, China, and in
South Korea, South Africa, the Ukraine,
Turkey, Romania, Mexico, and Algeria;
• Clay roofing tile capacity will also be
upgraded and expanded.
Following the start-up of the Castelleto
plant in Italy in 2005, two large projects
have been launched in France to better
serve our customers, improve the quality
of our products and spread our innovations.
The Marseille plant is being upgraded,
and a new plant is being built in Limoux,
to serve customers in the south of France;
a new plant is being erected in
Signy-l'Abbaye, in the Ardennes region,
to supply customers in the north.
SEVEN KEY DATES FOR LAFARGE IN 2005
MAY 20
Group is present. In line with the Group’s
The wind farm powering the Lafarge cement
Principles of action and signature of United
plant in Tetouan, Morocco, marks first French
Nations' Global Compact, Lafarge has thus
project registered to the Clean Development
reaffirmed its desire to see fundamental
Mechanism (CDM) Executive Board.
labor rights – as defined by the conventions
Inaugurated in May 2005, the wind farm
of the International Labor Organization –
is a world first for a cement plant. It supplies
respected around the world.
50% of the plant's electricity needs, helping
to fight climate change by reducing
SEPTEMBER 27
greenhouse gas emissions by 30,000 tonnes
The Group announces a new management
a year. In terms of environment, that's
team.
Accompanied by a new team, Bruno Lafont
roughly equivalent to planting two million
trees a year.
JULY 7
became Chief Executive Officer of Lafarge
Lafarge confirms its long-term commitment
effective January 1, 2006, succeeding
to Aceh, Indonesia.
Bernard Kasriel.
After inaugurating a floating terminal to
serve the market, the Group announced its
NOVEMBER 10
intention to invest $90 million to rebuild
The architecture and urban planning
its plant. It is also spearheading a program
symposium in Shanghai.
to assist employees and local communities,
Following the “Liquid Stone"” exhibit in
by rebuilding a village, restoring schools
Washington and in Princeton symposium
and mosques, and teaching building
on the future of concrete in architecture,
skills to local populations.
Lafarge organized a symposium in Shanghai
to debate and discuss with Chinese and
AUGUST 11
Western architects on the urbanization
Lafarge Shui On Cement joint-venture, a
trends and the challenges they face in terms
major step forward in China.
of the urban landscape, infrastructure and
Lafarge became China’s second-largest
new construction.
cement producer with production capacity
of 21 million tonnes in the Southwest, one
of the country's fastest growing regions.
SEPTEMBER 12
JUNE 21
Lafarge strengthens its commitment to social
Lafarge and the WWF renew their
reponsibility on a global level by signing
partnership for another 3-year term.
a four-party agreement with international
Objectives were renewed to continue
trade union federations.
reducing CO 2 emissions, measure
This international agreement on social
biodiversity, promote sustainable
responsibility and international labor
construction, and develop partnerships
relations applies to Lafarge's 80,000
on the ground.
employees in the 76 countries where the
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cement
WORLD
Leader
40,000 EMPLOYEES |
€7,600 MILLION IN SALES |
152 PLANTS IN 43 COUNTRIES* |
* Consolidated data at Decembre 31, 2005.
2005 RESULTS
In 2005, current operating income in the
The slight dip in current operating income in
Cement business improved by 11%, buoyed
Western Europe was largely offset by the
by a 21% increase in the second half of
excellent price performance in North
the year and a 12% rise in full year sales.
America. Operating margin in emerging
The operating margin declined slightly to
markets made a strong 18% advance.
21.3%, compared with 21.6% in 2004.
In 2005, emerging markets contributed 47%
The return on capital employed after tax
of the operating income in the Cement
remained stable at 9.7%* overall.
business, compared to 44% in 2004,
Our long-term strategy to preserve market
and only 29% in 1998.
share under difficult conditions led to
downward price pressures, which had a
negative impact on current operating income
in Brazil and South Korea.
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* At a 28.6% tax rate, unchanged since 2003.
WORLD CEMENT
MARKET BY VOLUME
11%
8%
BREAKDOWN
OF THE PRODUCTION
COST OF CEMENT*
WORLD CEMENT
MARKET BY VALUE
12%
20%
12%
29%
16%
2005
25%
46%
2005
2005
32%
25%
19%
27%
18%
● America
● China
● Rest of Asia
● Europe
● Africa & Mediterranean Basin
● America
● China
● Rest of Asia
● Europe
● Africa & Mediterranean Basin
● Energy
● Raw materials and consumables
● Direct production labor and maintenance
● Depreciation
* 2005 estimates
The restoration
of the exterior of
the Romanian Atheneum,
one the best known
monuments in Bucharest,
Romania, was realized
with Multibat® cement
from Lafarge Cement
in Romania.
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Impact of the sharp rise in energy costs
We were able to pass on the steep increase in
energy costs in most of our markets thanks to
the competitiveness of our products, the
success of our value-added products and
strong marketing initiatives. A better fuel mix
also helped keep higher energy costs in
check, particularly through the use of
alternative fuels.
2006 STRATEGY AND OUTLOOK
A well-balanced portfolio
In 2006, we expect to see buoyant demand
throughout the Cement business overall
with sales prices increasing faster than cost
inflation with few exceptions.
The growth strategy of the Cement business
remains grounded in a well-balanced asset
portfolio between developed countries and
emerging markets, the latter of which should
continue to contribute significantly to
earnings during the year.
Industrial and commercial performance
is targeted
Improving our industrial facilities remains a
priority.
In the commercial realm, we are taking ever
stronger measures to ensure the satisfaction
of our customers. Segment by segment, we
are accelerating our efforts to better meet the
increasingly sophisticated needs of our
customers.
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2005 HIGHLIGHTS
• SAFETY EFFORTS BEEFED UP |
review to strenghtened capacity at the
• NEW TEAMS SUCCESSFULLY
The Group's Cement business pursued
Tetouan plant in Morocco and at the site
INTEGRATED IN ECUADOR |
efforts, as it has for the past three years,
near Quito, Ecuador.
Realized in early 2005, the acquisition
to vastly improve safety at all sites. In
New grinding stations are acquired or
of Cementos Selva Alegre was a success,
2006, the focus will be on subcontrac-
built in Spain, South Korea, France, Chile
marking the Group's first entry into
tors.
and Morocco.
Ecuador. Integration focused on two key
themes: performance and corporate
• LAFARGE BECOMES SECOND-LARGEST
• SECOND PRODUCTION LINE SUCCESS-
culture, with improvements in safety
CEMENT PRODUCER IN CHINA |
FULLY LAUNCHED IN CHONGQING,
practices used as the driving force. By
A joint venture formed in August 2005
CHINA |
the end of the first year of operations, the
between Lafarge and Socam (Shui On
The new Chongqing production line,
number of work accidents declined
Construction and Materials Limited) has
inaugurated in November 2005, was built
dramatically, steady growth was achieved
given rise to Lafarge Shui On Cement, the
completely with Chinese equipment.
in sales and operating income, and the
leading cement producer in Southwestern
Global know-how and local technology
acquisition had already created value
China with a capacity of 21 million tonnes.
reduced the construction deadline to
to such a degree that the management
Lafarge controls the joint venture with a
16 months, down from 24 months. The
team began examining ways to quickly
55% stake and manages it.
degree of technological maturity of the
double the plant's capacity in an expanding
Chinese cement industry and two years
market.
• PRODUCTION CAPACITY UP SHARPLY |
of working closely with Chinese equipment
• NEW PRODUCTS LAUNCHED ON EVERY
The construction of nearly 5 million tonnes
manufacturers made the performance
of new capacity continued in 2005, in
possible. In the end, the investment
CONTINENT |
China, Bangladesh, Mexico, Morocco,
totaled $40 a tonne, three times less than
Launched in 11 countries in 2005, 17 new
and Vietnam. The new capacity is expect-
the usual amount, and Group standards
value-added products will represent
ed to come on stream during 2006.
were met. This model is currently being
volume of two million tonnes in 2006.
To further strengthen the positions of the
exported elsewhere within the Group.
Among the new products are easier-to-
Cement business, accompany market
use Avancrete in Malaysia, longer-lasting
growth and better serve customers, new
Reodur in Spain, improved, hermetically
investment was announced at the end of
sealed plastic-packaging in the U.K., and
2005, to build new production lines near
the continued development of bagged
Moscow, in Russia, as well as in South
masonry cement in Chile and Turkey.
Africa and Zambia by 2008. Lastly, new
projects are in an advanced stage of
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concrete
aggregates &
BREAKDOWN
OF THE PRODUCTION
COST OF CONCRETE
N°2
21,000 EMPLOYEES |
2004
36%
Despite improvements in operational
2005 RESULTS
performance and the success of value-added
Aggregates & Concrete had a strong 2005, with
sales up 13% and current operating income up
12%.
concrete products, sharp cost increases
strained margins.
Operating margin and the return on capital
In Western Europe, current operating income
increased by 15% thanks to the recovery in
employed* remained about stable at 7.4% and
8.1% respectively.
Asphalt and Paving businesses in the U.K. and
the solid growth in Ready-Mix operations in
France. North America had a moderate
improvement, with a strong aggregate pricing
In Aggregates & Concrete, we expect overall
impact, partly offset by weaknesses in Eastern
growth in Aggregates to be rather modest
Canada and East US Ready-Mix contribution.
in 2006, although growth should be robust
All other markets reported strong growth in
in emerging markets. In Concrete, markets
current operating income.
should continue to trend up overall.
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47%
1,708 PLANTS IN 27 COUNTRIES* |
WORLDWIDE
PA G E 7 4
10%
3%
4%
● Cement and cement materials
● Aggregates, sand and gravel
● Other raw materials
● Labor
● Other
2005 HIGHLIGHTS
• NEW PRODUCTION CAPACITY ACQUIRED
and aggregates in Portugal. Furthermore,
IN 2005 |
the transaction enhanced our vertical
In 2005, the Aggregates & Concrete
integration strategy in Spain, owing to the
business increased its production
proximity of these assets with our cement
capacity, mainly in growing markets. The
plant.
Ocho al Cubo (Eight in a Cube)
is a real estate project
in which eight architects
build eight model houses
and replicate them eight times.
Each of the eight houses
must be attractive,
white and made of concrete.
Group acquired quarries in two emerging
markets, Ukraine (Greenfield) and
• SUCCESS OF AGILIA® CONFIRMED |
Malaysia (Nilai with a 1 million tonne
Launched in 2000, Agilia® symbolizes
capacity), and expanded its network of
the success of our vertically-integrated
concrete plants, adding 20 plants in
business model and the power of our
Chile, Venezuela, Malaysia and South
combined research in Cement, Aggregates
Africa.
& Concrete and Admixtures. This product
Profitability was up in Greece, where
also contributes to advances in the
Lafarge acquired the Atlas quarry, which
construction industry, while offering
has a 2 million tonne capacity.
architects new possibilities.
In the U.K., the Group acquired Minimix,
Sales of Agilia® grew more than 25%
which has a quarry with a capacity of
in 2005. Today, it accounts for 2% of
0.4 million tonnes and four concrete
our total concrete sales and 10% of our
plants.
total profits in concrete. Agilia® sales
and their contribution to our profits are
• LEADERSHIP IN SPAIN AND PORTUGAL |
expected to further double by 2008.
In November 2005, Cemex disengaged
from the joint venture created with Lafarge,
propelling the Group to the top of the
concrete market in Spain and making it
one of the largest producers of concrete
Four key themes: safety, satisfaction, new
In 2006, the Group will continue to stand
products and performance
apart from its competitors through new
Safety remains a key focus following the
value-added products, which offer a strategic
encouraging progress made in 2005, when
competitive advantage.
the number of lost-time injuries declined 25%.
At the same time, the implementation of the
Employees, at all levels of the Aggregates
performance program will be accelerated at
& Concrete business, will pursue efforts to
all sites to foster far-reaching behavioral
strengthen ties to their customers and will
changes, leading notably to more responsive
continue to enhance customer satisfaction.
decision-making and further structural
To this end, we have set three objectives for
standardization. All these measures are
2006, including improving delivery times,
designed to improve profitability.
product quality and product returns
processing.
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roofing
WORLD
Leader
12,000 EMPLOYEES |
2005 RESULTS
The return on capital employed after tax
Sales were up a modest 1%, while current
operating income decreased 34% over
the full year, after a very difficult first half
slipped to 3.6%, from 5.5% in 2004.*
and a second half decline limited to 10%.
In 2006, we expect the Roofing business to
The disappointing results were due largely
improve in Western Europe, except in
to contraction in Germany, where
Germany, where pricing pressures should
the building market has been depressed
remain in force. Conditions in the U.S. market
for 12 years by fierce price competition.
should remain favorable with continued
As a consequence, the production capacity
strong sales growth expected. The expansion
utilization rate in Germany fell sharply
of the U.S. market will be accompanied
despite major restructuring efforts. Efforts to
by the construction of two concrete tile
improve our competitiveness were pursued
plants, including one in Nevada and the
during the year, resulting in a 30% increase in
other in Florida, representing a $70 million
clay tile productivity in Germany, for
investment for the MonierLifetile joint
example. For the business as a whole, the
venture between Lafarge and Boral.
production capacity utilization rate grew 5%.
Furthermore, growth was strong in the U.S.
All in all, the operating margin declined to
6.5%, compared with 10% in 2004.
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CRESCENDO
A private home near
Calicut in Kerala state,
India. The home was
designed by architect
Tony Joseph with
red-brown varnished
clay tiles produced
by Lafarge Roofing
India Pvt Ltd.
2005 HIGHLIGHTS
• MAJOR INVESTMENT FOR CLAY TILE
PLANTS MODERNIZATION |
in Signy-l’Abbaye, in the Ardennes region,
of the Black Economic Empowerment pro-
to serve customers in Northern France.
gram. The low cost system is aimed at
The Roofing business boosted capacity in
2005 to better meet demand. Investments
broadening access to housing in South
• INNOVATIVE ROOFING SOLUTIONS |
Africa.
approved during the year were aimed at
In February, a new clay tile, the Die
upgrading our existing plants and build-
Nieuwe Hollander, was successfully
ing new ones.
launched in the Dutch market. In July,
Safety programs, audits and manager
Following the successful startup of the
an innovative, low pitch roofing system
training have paid off. Several plants
Castelleto di Branduzzo plant in Italy, two
was introduced in Italy. The comprehen-
reported no major accidents and the
large projects were launched in France
sive system includes large format tiles
accident rate declined 30%.
to better serve our customers, improve
as well as insulation and ventilation com-
product quality and roll out innovations
ponents, a first in the non-residential
over the entire territory. The projects
building segment and a springboard to
included the upgrading of the Marseille
growth opportunities in Italy. Another
plant, the construction of a new plant in
innovative roofing system was launched
Limoux to serve customers in the South
in South Africa through the Marulelo
of France, and the building of a new plant
Roofing Solutions joint venture as part
Results recovery is the top priority
The Roofing business is on the road to
recovery. The objective is for the activity to
• WELL-CRAFTED SAFETY PROGRAMS |
• Reducing fixed and variable costs and
raising sales prices to offset higher energy
and raw material costs;
cover its cost of capital by 2008 by reaching
• Innovative products and systems;
an Ebitda target of €350 million by 2008
• Pursuing efforts to modernize clay tile
from €222 million in 2005.
operations;
• Growth in the U.S. and emerging markets.
Management has a clear plan for success and
will take action in five main areas:
• Safety, which is the basis for operational
excellence;
CRESCENDO
|
L A FA R G E
|
APRIL 2006
|
PA G E 7 7
gypsum
WORLD PLASTERBOARD
MARKET
BY VOLUME
N°3
18%
6,000 EMPLOYEES |
5%
2004
54%
continued to pursue its "First" performance
2005 RESULTS
Sales increased by 9%, while current operating
income rose 14% buoyed by a 24% advance
in the second half of the year. In 2006, the
Gypsum business posted record operating
margin of 10.2%. The return on capital
employed after tax* also reached a historical
high of 10.2%, compared with 9.3% in 2004.
Momentum in the U.S. market, which accounts
for half the world's plasterboard market,
contributed significantly to these excellent
program, which was implemented across all
operating units in 2005. By sharing best
practices through the program, prices can be
successfully managed and fine-tuned, leading
to significant performance gains.
Continued improvement in quality and
innovation with the launch of such products
as Signa™, Rapid Deco, Pregymax, and
Pregymetal, also played a key role in the
results growth.
results, thanks to a combination of strong
demand, higher selling prices and good
industrial performance.
The year should be favorable for the Gypsum
business. Sales prices should continue to rise
The significant rise in energy, raw materials
in North America, albeit at a slower pace than
and freight costs was offset by higher sales
in 2005. Central European markets are
prices. The Group's Gypsum business
|
L A FA R G E
|
APRIL 2006
|
CRESCENDO
17%
WORLDWIDE
PA G E 7 8
1%
5%
● Middle East
● Asia
● Central and Eastern Europe
● Western Europe
● North America
● Rest of the world
PRODUCTION
COAST BREAKDOWN
IN GYPSUM
12%
24%
27%
2004
18%
19%
● Gypsum
● Paper
● Fuel
● Labor
● Other
2005 HIGHLIGHTS
• €400 MILLION IN INVESTMENTS |
in Shanghai and Chongqing, China, while
• PRIORITY IS GIVEN TO INNOVATING
In 2005, Lafarge announced that it would
capacity will be doubled at the plant in
AND SPREADING INNOVATION |
invest €400 million to boost the produc-
South Korea. A new plant will be built
Following the successful June 2004 launch
tion capacity of its Gypsum business by
in Istanbul, Turkey. In Romania, produc-
of Signa™ in France, this revolutionary
25% by 2007, to become the quality and
tion capacity will be tripled.
plasterboard with four tapered edges was
cost leader in all its markets.
By mid-2006, capacity at the New York
launched the same year in the Netherlands,
• ENTRY INTO NEW, FAST-GROWING
and in Thailand in May 2005. It will be
plant should double to supply the
MARKETS |
Northeastern U.S. In Silver Grove,
Management also decided to enter the
Kentucky, construction of a second pro-
new, fast-growing markets of South Africa,
duction line got under way and should
Ukraine, Algeria, Mexico, and Saudi
be operational by mid-2007, doubling
Arabia by developing local production
its capacity to serve the Central U.S. In
instead of importing to take advantage of
the U.K., the Group decided to build a
these rapidly expanding markets.
introduced in Italy in June 2006.
new plasterboard plant in the Midlands.
In Asia, two additional plants will be built
The reception hall
at the Hilton in Sydney,
Australia renovated
by architect Johnson Pitton
Walker. Lafarge
Plasterboard Australia
supplied the Pregyboard
Acousticontrol L580
and 13-millimeter
Mastaboard plasterboard
to contribute to the hall's
elegance and superior
acoustics.
expected to show momentum in 2006. The
The third phase of the “First” performance
outlook has also improved for Asian markets,
program, which concerns plant reliability,
which have been depressed in 2005.
will be rolled out during the year. Two new
As the world's third-largest supplier of
standard operating procedures have been
gypsum, Lafarge plans to pursue its growth –
added to the program, including the safety
the industry's fastest over the past 10 years –
procedures at the end of 2005 and the
while continuing to boost performance.
environmental procedure in March 2006.
The internal growth investments announced
The business is striving for operational
in 2005 to increase the production capacity
excellence in production.
of the Gypsum business by nearly 25% will
Efforts to improve safety will be stepped up
continue at an accelerated pace in 2006.
in 2006.
CRESCENDO
|
L A FA R G E
|
APRIL 2006
|
PA G E 7 9
organization of the
group
BOARD OF DIRECTORS
Bertrand Collomb
Bernard Kasriel
Philippe Charrier
Chairman
Vice Chairman
Oscar Fanjul
Jacques Lefèvre
Guilherme Frering
Vice Chairman
Juan Gallardo
Michael Blakenham
Alain Joly
Jean-Pierre Boisivon
Raphaël de Lafarge
Michel Bon
Michel Pébereau
Bruno Lafont
Hélène Ploix
HONORARY CHAIRMEN
Jean Bailly
Jean François
Olivier Lecerf
MEMBERS OF THE EXECUTIVE COMMITTEE
Bruno Lafont
Guillaume Roux
Isidoro Miranda
Executive Vice President,
President of the Gypsum business
Chief Operating Officer,
Jean-Charles Blatz
Jean-Jacques Gauthier
Co-President
of the Cement business
President of the Aggregates
Finance
Michel Rose
& Concrete business
Ulrich Glaunach
PA G E 8 0
|
Christian Herrault
Jean-Christophe Barbant
Co-President
Human Resources
of the Cement business
President of the Roofing business
and Organization
L A FA R G E
|
APRIL 2006
|
CRESCENDO
CONTACTS
Senior Vice President, Group Communications
Philippe Hardouin | philippe.hardouin@lafarge.com
Phone: +33 1 44 34 11 71
Fax: +33 1 44 34 12 08
Vice President, Group External Communications
Stéphanie Tessier | stephanie.tessier@lafarge.com
Phone: +33 1 44 34 92 32
Fax: +33 1 44 34 12 23
INTERNATIONAL ADVISORY BOARD
Lynda, Baroness Chalker
Thierry de Montbrial |
of Wallasey |
France
United Kingdom
Founder and President,
Chairman, Africa Matters Limited
French Institute for International
Barbara H. Franklin |
Relations
United States
Alexei A. Mordashov |
Chairman and Chief Executive
Russia
Officer, Barbara Franklin
Chairman, Severstal
Enterprises | Former US Secretary
of Commerce
Charles O. Holliday, Jr. |
United States
Officer, DuPont
Mohamed Kabbaj |
Morocco
Hugh M. Morgan |
Australia
Reserve Bank of Australia
Robert W. Murdoch |
Canada
Director of companies
N.R. Narayana Murthy |
Chairman, Lafarge Maroc
India
South Africa
Chairman, AKA Capital (Pty) Ltd.
Takuzo Kitamura |
Japan
Special Corporate Advisor,
Ajinomoto Co. Inc.
David K. P. Li |
Registered with the AMF, the French market authorities,
the French version of the Lafarge 2005 annual report
and 2005 reference document (document de référence),
as well as the U.S. version on form 20-F, registered
with the Securities and Exchange Commission (SEC),
may be downloaded at www.lafarge.com.
Managing editor: Stéphanie Tessier
Design and production: Lafarge Group Communications
Department, Skipper Communication
Editorial team: Lafarge, Angie, François Bernheim
Graphic design:
Production: HMS Publications
Director of the Board,
Governor of greater Casablanca |
Reuel J. Khoza |
Vice President, Investor Relations
Yvon Brind’Amour | yvon.brindamour@lafarge.com
Manager, Analyst Relations
Danièle Daouphars | daniele.daouphars@lafarge.com
Manager, Individual Shareholders
Aline Pic-Paris | aline.pic-paris@lafarge.com
Phone (toll free in France): 0 800 235 235
International phone: +33 1 44 34 12 73
Fax: +33 1 44 34 12 37
Chairman and Chief Mentor,
Infosys Technologies Limited
Henning Schulte-Noelle |
Germany
Chairman of the Supervisory
Board, Allianz AG
Photo credits: D.R. Médiathèque Lafarge | Corbis /
Bob Krist - Daniel Rousselot - Paul Souders | Gettyimages /
Grant Faint - Martin Holtkamp - Johner - Allan Montaine Randy Olson - Justin Pumfrey - Stockbyte - StockTrek |
Rapho / Gilles Bassignac - Jean-Christian Bourcart Julien Chatelin - Pascal Dolémieux - Grégoire Korganow Frédéric Neema - Gérard Uferas - Nian Zeng | Eric Tourneret |
Philippe Couette | Thierry Mamberti | Images et concepts /
Laurence Prat | Arielle Bernheim | Garth Dale |
Gustav Knecht | Mauricio Pavon | Augustinus Sidarta
Photography | Crystal Commercial Photography Co. Ltd. |
Rodrigo Gomez | Annabel Moeller | © Anne de Vandière |
© WWF - Canon / Anthony B. Rath | © Olivier Kayser |
© Janet Jarman | D.R. Lafarge RomCim | D.R. Lafarge
Roofing | D.R. Lafarge Zement GmbH | D.R. Lafarge
Dakproducten - NL | D.R. Lafarge Granulats - F. Renoir |
D.R. Lafarge Malayan Cement | © Rudy Ricciotti Architecte /
Alain Sauvan | © Cabinet Christian de Portzamparc /
Philippe Hurlin / Jörg Hejkal | © Hypergreen /
Jacques Ferrier Architecte | Synthese Architecture and AIKA
Projekt s.c. | l’Atelier du Béton | Francesco Passaniti |
la Compagnie des Arts | l’Atelier Béton Concept | la Compagnie.
Hong Kong
Officer, The Bank of East Asia Ltd.
This report is printed on mat coated paper, ECF, acid free,
fully recyclable and biodegradable, and produced at
a mill with ISO 14001 environmental certification.
Headquarters
61, rue des Belles Feuilles - BP 40
75782 Paris Cedex 16 - France
Phone: + 33 1 44 34 11 11
Fax: + 33 1 44 34 12 00
www.lafarge.com

The magazine

Transcription

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