Holcim Raises 2026 Guidance After Accelerating Growth in Second Quarter
The Swiss building materials giant posted 13.1% recurring EBIT growth in Q2 and upgraded full-year targets following strategic acquisitions of Xella and Pacasmayo.
Strong Momentum Accelerates in Q2
Holcim AG reported accelerating growth in the second quarter of 2026, with organic net sales up 6.4% and recurring EBIT climbing 13.1% compared to the prior-year period (earnings call, 2026-07-31). The performance prompted the Swiss building materials company to raise its full-year guidance to the high end of its medium-term targets.
For the first half of 2026, Holcim posted organic sales growth of 5.2% and recurring EBIT growth of 11.5%. CEO Miljan Gutovic attributed the results to "increased customer demand for our sustainable offering, our strict cost discipline and of course, our operational excellence" (earnings call, 2026-07-31).
CFO Steffen Kindler emphasized the company's pricing discipline, noting that Holcim delivered "positive price over cost in all our regions" for the 17th consecutive quarter (earnings call, 2026-07-31). Earnings per share rose 7.4% in Swiss francs year-over-year.
Regional Performance and Strategic Acquisitions
Asia, Middle East and Africa led regional performance with recurring EBIT growth of nearly 24% and margin expansion of 80 basis points to nearly 26% (earnings call, 2026-07-31). The region benefited from favorable demand in North Africa and Australia, including infrastructure projects tied to Brisbane's upcoming Olympic Games and Sydney's Western Parkland City development.
Latin America maintained a recurring EBIT margin "consistently above 30%" while delivering 6.2% organic sales growth, driven by Mexico, Ecuador and Central America (earnings call, 2026-07-31). Europe saw net sales acceleration in the second quarter, particularly in Germany, Switzerland, Spain, Greece and Eastern Europe, with alternative fuel usage exceeding 70%.
Holcim completed two major acquisitions during the first half: Xella, closed June 19, brings approximately CHF 900 million in projected 2026 sales and more than 50 production facilities in the walling market. The company also acquired Pacasmayo in Peru in March, adding CHF 500 million in projected sales and integrated cement and concrete operations (earnings call, 2026-07-31).
With Xella, building solutions now represent 50% of net sales in Europe, advancing Holcim's strategy to expand beyond traditional cement (earnings call, 2026-07-31).
AI and Sustainability Initiatives
Holcim is scaling artificial intelligence initiatives across production, logistics, commercial operations and administration, expecting "benefits from AI of around CHF 200 million by 2028" through cost savings and avoidance (earnings call, 2026-07-31). The company has deployed AI-powered predictive maintenance tools and quality optimization systems that have tested more than 7,000 cement formulations.
The company's premium sustainable brands—ECOPact, ECOPlanet and ECOCycle—continue gaining traction, with recycled construction and demolition materials volumes up 36% in the first half (earnings call, 2026-07-31). Holcim now operates close to 150 circular construction hubs following the Xella acquisition.
Updated Guidance
For full-year 2026, Holcim now expects organic net sales growth of 5% and organic recurring EBIT growth of 10%—both at the high end of its 2030 strategic targets. The company maintained its free cash flow guidance at around CHF 2 billion and projects year-end leverage of approximately 1.6x, near its 1.5x target despite recent acquisitions (earnings call, 2026-07-31).
This article was generated by MarginX from the earnings call on 2026-07-31. It is not investment advice.