Holcim AG (HOLN) Earnings Call Transcript & Summary

Good afternoon, everyone. Thank you all of you who came here today to Zurich and to those of you who are joining us online. It is my absolute pleasure to welcome each and every one of you to our 2025 Investor Day. Indeed, today is a special day for all of us at Holcim as we launch our NextGen Growth strategy. With the planned spin-off of our North America business, Holcim will unlock additional opportunities for growth and value creation for our people, for our customers and of course, for our shareholders. Once again, a warm welcome to all of you. On the following slide, you can see the topics we will discuss today. I will cover the first 3 topics and before handing it over to our CFO, Steffen, to share more on our financial targets. And finally, we look forward to addressing your questions in Q&A at the end of this presentation. So the question is why invest in Holcim. Holcim has been and will continue to be a highly attractive and compelling investment. Today, we are the leader in the most attractive markets with leading sustainable offering for our customers. This actually enables us to capture the tailwinds from powerful megatrends shaping the future of construction industry. We are also unlocking significant growth opportunities across all our geographies and in our Building Solutions segment, which will enable us to achieve above the market growth. Our talented people and performance culture will continue to deliver superior financial performance and value creation. All of this will allow Holcim to continue driving shareholders' value through growth-focused capital allocation and attractive cash returns. Now I would like to share with you why all of us here at Holcim are so excited about the future of this remarkable company. With our strategy, NextGen Growth 2030, we are committing to an industry-leading financial and sustainability targets. On the financial side, Holcim will keep growing net sales from its leading market positions by 3% to 5% per year, with, of course, of overproportional EBIT growth of up to 10%. And we will consistently turn sales growth and margin expansion into strong cash generation. A key part of our transformation will be expanding our high-value building solutions. Our target is to achieve a 50-50 net sales split between materials and solutions by 2030. On the sustainability side, Holcim will continue to scale market share of our ECO brands. ECOPact and ECOPlanet will represent the majority of net sales by 2030. At the same time, we will accelerate circular construction initiatives by recycling more than 20 million tonnes of construction and demolition materials with our ECOCycle technology platforms. In addition, we will reduce net emissions to below 400 kg per ton of cementitious. And as the nature is becoming an increasing focus point, freshwater withdrawal becomes one of our key targets as well. Before we dive into NextGen Growth 2030 strategy, let's first take a moment to reflect on where is Holcim today. My 48,300 colleagues and I are driven by a clear purpose to build progress for people and the planet with sustainability and innovation at the core of everything we do at Holcim. With our vision to be the leading partner for sustainable construction, we will expand our sustainable offering, serving customers across the built environment. And as we expand our unique product portfolio, we are also introducing a new customer-focused segmentation. Building Materials consists of cement and aggregates, where we have leading positions in most of our geographies. This is the foundation of our company. This is the foundation of our business. We will continue to deliver profitable growth in this segment through sustainability initiatives and also through innovation. Building Solutions, on the other hand, consists of energy-efficient systems as well as high-performance circular and sustainable concrete and surfacing. In Building Solutions, we provide our customers with end-to-end solutions from foundation and flooring to the walling and roofing. With building materials and Building Solutions, we are serving markets and customers across the whole built environment. In infrastructure, for instance, Holcim is the partner of choice on all mega projects from roads and bridges to new clean energy production facilities. At the same time, Holcim has tailor-made offerings for customers in industry from data and logistics centers to new factories. And when it comes to buildings, our innovative and sustainable offerings are used to build everything from a single-family home to high-rise towers. Now Holcim has a leading positions in highly attractive markets. We are particularly proud that we have top 3 positions in 90% of our cement markets. At the same time, 78% of our sales come from advanced markets. These markets are defined by advanced building norms, increasing demand for sustainable construction and also energy-efficient refurbishment. This provides Holcim with opportunities for profitable growth. And in terms of geography, we operate a well-balanced and diversified footprint across 3 key regions: Europe, Latin America and Asia, Middle East and Africa. The new scope of company after the spin-off is reflected on this slide. As you can see, we do have a strong financial foundation, which is driven by our deeply embedded performance culture. For example, we generated net sales of over CHF 16 billion in 2024 with an industry-leading EBIT margin of 17.4% and free cash flow of CHF 2.2 billion. Even after the spin-off of our North American business, we will continue to be one of the largest companies in our sector. We have also delivered continuous EBIT growth in local currency and also in Swiss francs. And at the same time, we have improved our return on invested capital. One of the key drivers of our strong growth is our highly effective M&A strategy. As you can see, we have the right scale to win. We operate in 45 countries spanning 5 continents, where we deliver performance and value creation, thanks to drive of our people and in part P&L leadership. The deep commitment of our people gives me the highest confidence that we will successfully execute our strategy, NextGen Growth 2030. We will hear more from Steffen on this later as he takes you through the financials. As I have mentioned previously, all these successful M&A transactions have been instrumental for our profitable growth story. During the period between 2018 and 2024, the team here that is present here with me today has closed 91 deals across 3 regions. What we do, we buy at the average of 5x EV to EBITDA multiple, while we are divesting at 15x. I'm really proud of this remarkable M&A track record and our decentralized approach, our agility and of course, our successful integration to deliver synergies and also to deliver the business plan. Value-accretive M&A will remain at the heart of our strategy as we continue to strengthen our position in the most attractive markets and grow in the existing and new business segments. And all of this will deliver further profitable growth in the years to come. Once again, thank you all for joining us to launch the next chapter for Holcim. I'm now excited to present our new strategy, NextGen Growth 2030. [Presentation]

As you will see in the following slides, the spinoff of North America will unlock significant opportunities for Holcim. Holcim will leverage its sustainable leadership to deliver profitable growth in Europe, Australia and North Africa. We will expand our high-value building solutions to capture the new and profitable market segments. We will accelerate growth in Latin America to benefit from very strong fundamentals and industrialization trends. And of course, we will continue to drive shareholders' value through growth-focused capital allocation, including value-accretive M&A. Now in today's world, we are witnessing very powerful megatrends that are indeed transforming the way we build. Population growth and urbanization are driving construction spend in the cities with rising demand for housing and infrastructure. At the same time, to prolong the life of existing buildings, we see increased opportunities for energy-efficient refurbishment. The emphasis on modular construction is also growing with off-site production enhancing on-site construction productivity. And in response to climate and nature needs, building norms for sustainable and resilient construction are being enhanced. We are also seeing a strong global to local trend in infrastructure and manufacturing investments, and this is actually driving industrialization. And clearly, digitalization is also driving operational efficiency, cost optimization and enhanced customer service. And Holcim is best positioned to benefit from these powerful megatrends, shaping the future of construction, while at the same time, we are creating value for our people, for our customers and also for society. With those megatrends in mind, our NextGen Growth 2030 is built on 4 strategic drivers. one, focused investment in attractive markets; two, sustainability driving profitable growth; three, expanding high-value building solutions; and four, performance culture and value creation. Let's now look at each of these in detail and discover how they will drive Holcim to achieve our NextGen Growth 2030 targets. [Presentation]

In each region, we are able to leverage our established leadership position to accelerate profitable growth. I will start with Europe, which generated close to CHF 9 billion of net sales last year. This is the region which is at the forefront of our sustainability road map. And the team in Europe has achieved an outstanding EBIT growth of 14% per year in local currency over the last 3 years across all market conditions and economical cycles. At the same time, we have closed more than 60 value-accretive deals since 2018. This, I would say, outstanding performance proves that our focus on decarbonization and circular construction is indeed delivering profitable growth. We are excited about the future of Europe, especially building industry. Demand will continue to grow, and it will be driven by sustainable investments, which are committed by EU Commission, the need to reduce the housing shortage and also increasing requirements for energy-efficient repair and refurbishment solutions. On top of that, recent news about German infrastructure plan gives us -- gives me a confidence for significant upside potential. In Building Materials, we will capture the growth opportunity with our leading cement and aggregate footprint as well as our industry-shaping sustainability road map. We will continue to invest in decarbonization and also in circular construction to drive profitable growth. In Building Solutions, we have an excellent opportunity to provide energy-efficient repair and refurbishment solutions to meet growing demand. This will further strengthen our unique product portfolio. To accelerate our growth in this segment, we will pursue bolt-on and large strategic M&A opportunities in our key segments. Next, I want to talk about our presence in Asia, Middle East and Africa. This is indeed a diverse region, and Holcim is present in the most advanced market, which are primed for growth. Last year, we delivered nearly EUR 4 billion in sales and EBIT margin of 22%. In this region, we have been actively optimizing our portfolio. And as a result of that, we have successfully completed 18 M&A deals since 2018. The EMEA region will remain a strong and reliable profit and cash generator for Holcim. As I said, it is indeed diverse region. Therefore, we are observing significant opportunities for Holcim coming from population growth across the whole region, increasing infrastructure spend, for example, in Australia or reducing significant housing shortage in North Africa. In Building Materials, we will use the strong growth fundamentals and our state-of-the-art assets with the lowest cost to market to further expand our margins. North Africa will play a significant role in this strategy as we will further enhance our position as an export hub for cost competitive and decarbonized materials. In Building Solutions, we will increase our market reach with our differentiated sustainable offering and high-performance concrete like ECOPact, modular construction in Australia and mortar footprint in North Africa. Next, Latin America. This is our most profitable region with EBIT margin of 34% and a high cash generation. Our net sales exceeded CHF 3 billion, and we have leading market positions in building materials. We continue to invest and grow our footprint in this highly attractive region with 11 M&A deals. For example, last year, we expanded in Guatemala and we entered the Peru. The region is powered by a significant housing shortage of nearly 26 million units, a rising demand for infrastructure projects of USD 200 billion and sustained remittance of USD 160 billion per year, mainly used in building sector. For Holcim, these market opportunities will drive further growth in Building Materials, thanks to our leading footprint. Leveraging our state-of-the-art operation in these, what we would say, structurally attractive markets, we will benefit most from the region's strong demand momentum. The construction boom is creating enormous organic and inorganic growth opportunities with high returns for us for Holcim. In Building Solutions, we will expand in our innovative and sustainable concrete offering with ECOPact. This position us as the leading partner for all these mega projects, industry and housing projects as well. With Disensa, which is the largest construction materials retail franchise in the region, we are benefiting from direct end customer and market access. Today, we operate around 2,000 Disensa stores. And by 2030, we want to reach 5,000. I would say that LatAm is a highly fragmented market, and we do see multiple opportunities, M&A opportunities in flooring, in walling and in roofing solutions. Simple for us, LatAm is a gem. We do have leading positions, thanks to our geographical coverage and the largest construction retail franchise, Disensa. We have the best-in-class assets, which are reflected in our leading profitability. And Holcim in Latin America continues to deliver outstanding cash generation, which we are fully -- which we are able to fully repatriate. Therefore, Holcim is best positioned to capture the growth in Latin America. To summarize, when we include all 3 regions from Europe to EMEA and of course, Latin America, Holcim has the right geographical footprint supported by market tailwinds and unique product portfolio. With focused investments in the most attractive markets, we will deliver above-market profitable growth and create value for our customers and also for our shareholders. [Presentation]

Now let's look at our second strategic driver, sustainability driving profitable growth. Advancing sustainability as a driver of profitable growth, Holcim will grow its net sales and margins in line with industry shaping road map. And by 2030, we will achieve industry-leading sustainability targets. We are scaling our sustainable offering to meet demand. We want to reach above 50% net sales of ECOPlanet and ECOPact by 2030. Holcim accelerated profitable growth in circular construction will increase our construction and demolition materials volumes to 20 million tonnes using our ECOCycle technology platform. Our innovation will further decarbonize -- accelerate decarbonization as we are reducing our net emissions below 400 kg per tonne of cementitious. And to build a nature-positive future, we are reducing our freshwater withdrawals by 33% versus 2020. Please note that we do all of this because it is the right thing to do, but also it makes perfect business sense. Sustainability is driving net sales growth and margin expansion at Holcim. We are seeing rising demand for sustainable offering that comes with price premiums. With our innovative formulations, better energy mix and CO2 avoidance are reducing costs. For example, by replacing traditional fossil fuels, we are not only reducing CO2, but we are also reducing the cost. At the same time, replacing slag and clinker with calcined clay, all construction and demolition materials on one hand, has a positive impact on carbon reduction and also has a positive impact on cost reduction. So in summary, sustainability is driving net sales growth and margin expansion from cost reduction. To show that we walk the talk, let's look at the region Europe. Despite softer, you can say, market conditions in Europe in the last 3 years, Holcim continued to scale up its sustainable offering. We continue to invest in circular construction, and we kept reducing CO2 per tonne. This resulted in a net sales growth of more than 30% and overproportional EBIT increase of 60%. Just for the record, margin expansion in Europe was 300 basis points. This actually demonstrates that sustainability drives profitable growth. Customer demand for our sustainable brands, ECOPact and ECOPlanet continues to grow. As you can see on this slide, we extended our market penetration, achieving 26% of ready-mix sales for ECOPact and 31% of cement sales for ECOPlanet. This story will continue. By scaling our sustainable offering, we want to reach above 50% sales of ECOPact and ECOPlanet by 2030. We are also best positioned to scale up our circular construction, thanks to our well-established footprint in the key metropolitan areas. Over the next few years, we want to expand our network of recycling centers to 150 in order to recycle more than 20 million tonnes of construction and demolition materials. We will continue to innovate in advanced technologies to upcycle construction and demolition materials. And with our vertical integration, we are able to use these upcycle materials in our own operations from ready-mix and asphalt all the way to cement and mortar. Circular construction is a profitable growth driver for Holcim. Our industry-shaping decarbonization road map gives us the confidence to set the most ambitious targets. Our aim is to be below 400 kg CO2 per tonne of cementitious and all of this is, of course, validated by SBTi. In order to achieve this, we will be focusing on formulation, energy and carbon capture. We have hundreds of scientists and engineers working in our 7 R&D hubs around the world to foster innovation around those 3 levers. We also want to be a nature-positive business, offering sustainable products that bring nature into cities. And by 2030, we will reduce our freshwater withdrawal by 33% compared to 2020. Now let's go to our next strategic driver. [Presentation]

And now we come to Building Solutions. So expanding Building Solution is a key part of our NextGen transformation. By doing this, we will grow our addressable market by leveraging new sales channels and amplifying portfolio synergies. We will focus on organic investment and also on value-accretive M&As. As the leading partner for sustainable construction, we serve our customers across the built environment with these high-value building solutions. We offer energy-efficient building systems from walling to roofing. And we also offer high-performance ready-mix concrete and surfacing from foundation to flooring. Holcim serves customers across the built environment. Thanks to our broad product portfolio, which is, of course, powered by our brands, we are close to our customers. We are providing tailor-made solutions for partners across the building value chain. This starts with project design and engineering and all the way to the project execution. Holcim actually provides a fully integrated end-to-end building solutions for all applications. We are the leading partner to meet our customer most ambitious needs from a low carbon and circular construction to energy efficiency across building life cycle, from a durability and climate resilience to speed and efficiency enabled by digital and modular construction and always with equal or better quality and performance properties, and this is actually what it means to be the leading partner for sustainable construction. [Presentation]

To expand our addressable markets in Building Solutions, we will focus on growing our energy-efficient building systems. Earlier, we spoke about the powerful megatrends shaping the future of construction, ranging from rapid urbanization, addressing the housing gap and the increasing demand for repair and refurbishment. These trends perfectly align with our unique portfolio of energy-efficient walling and roofing systems. With our systems and specification selling and also with our premium brands like PRB for mortar, ZinCo Elevate for waterproofing and roofing, we will be able to accelerate profitable growth in this segment. In short, we want to grow in Building System because of its growing demand, attractive margins, high returns and, of course, high cash conversion. Equally important to our portfolio are concrete and surfacing. Thanks to our customer-centric innovation, we will expand our sustainable and high-performance concrete offering. scaling up our premium brands like ECOPact and DYNAMax and also incorporating our digital solutions with Holcim Plus, we will be able to further enhance our value offering and also a customer experience. We will also increase the usage of construction and demolition materials in our concrete with our ECOCycle platforms. All of these measures will help us to grow this segment further as it is highly synergetic with low capital intensity. Expanding Building Solutions will be the growth driver for Holcim as we target 50-50 net sales split between materials and solutions by 2030. Our expansion strategy allows us to capture a broader customer demand by extending our addressable markets. Also by leveraging new sales channels and amplifying synergies, we will further drive margin expansion for Holcim. And our growth in Building Solutions is also underpinned by our focused organic investments. At the same time, we do have a strong M&A pipeline of bolt-on and also of strategic acquisitions. With Building Materials and Building Solutions, Holcim will be uniquely positioned to provide end-to-end integrated solutions to meet customer demand across the whole built environment. [Presentation]

So, so far, I have spoken about our leading footprint, our leading sustainability road map and definitely our unique product portfolio in Building Solutions. Now let's shift focus to our fourth strategic driver, which is performance culture and value creation. Let me start by introducing you to my best-in-class leadership team that will drive our new strategy. Together, all of us, we bring a wealth of experience and expertise with an average of 18 years in our industry. This team has a proven track record of performance, and I'm confident that together with our 48,300 colleagues, we will deliver NextGen Growth 2030. Our purpose-driven culture is characterized by Holcim spirit. This is foundation why we are delivering such a superior performance. Today, I want to highlight what gives us, I would say, a competitive edge. Of course, when it comes to our operation, we always put health and safety as our top priority. We do operate a decentralized organization with more than 450 empowered P&L leaders. And this is allowing us to adapt swiftly to market opportunities and also changing dynamics. We believe in nurturing talent with our in-house Holcim University, we are developing next-generation leaders to really drive superior performance. And our employees are engaged behind a clear purpose of building progress for people and also for planet. We continue to innovate through our 7 R&D hubs globally to develop cutting-edge formulations and to launch new products, which are tailored to customer needs. In addition, Holcim MAQER Ventures is expanding the open innovation ecosystem, working with over 100 start-ups on next-generation technologies for the built environment. In summary, Holcim's deeply embedded culture of -- will deliver superior financial returns and value creation for our people, for our customers and for our shareholders. On behalf of 48,300 colleagues across 5 continents, who I'm really incredibly proud to work alongside every day, we are ready for the NextGen Growth 2030 journey. At this point, I would like to invite on stage our CFO, Steffen, to provide more details on our financial targets.

Thank you, Miljan, and good morning, good afternoon, everybody. A warm welcome also from my side. We're certainly ready to embark on our NextGen Growth 2030 journey. Before we dive into our financials, allow me to provide some additional context on the definition of our figures. In order to allow better comparability with peers and to align with industry practices, we will show EBITDA and free cash flow before leases throughout this presentation. Our financials are also adjusted to the Holcim scope post spin-off. All data before 2024 excludes contributions from countries divested as of December 31, 2023. I invite you to go at the end of this presentation where more details on the definitions and scope can be found in our disclaimer on alternative performance measures. With that out of the way, now let's take a closer look at the record performance in 2024. We achieved net sales of CHF 16.3 billion with a contribution of 37% from Building Solutions in 2024. Alongside the broad-based top line growth, we also achieved a record profitability with CHF 2.8 billion in EBIT and EBIT margin of 17.4%, which is up 80 basis points versus 2023. We are especially pleased with the EBIT growth in local currency of 8.5% versus 2023 despite the impact of divestments. At the same time, we continue to deliver a strong free cash flow before leases of CHF 2.2 billion in 2024. All of this while achieving a return on invested capital of 11.1%, which is an increase of 30 basis points versus 2023. These results demonstrate our continued efforts to strengthen our financial profile. Over the past 3 years, if we take a bit of a longer look at this, we were able to continuously grow our top line by 8.2% on average in local currency, while expanding our EBIT over proportionally with an average EBIT growth per year in local currency of 11.6%. We continued to deliver an industry-leading cash conversion rate of above 50% on average and have rapidly expanded our return on invested capital by 270 basis points over that time frame. As you can see, Holcim is stronger than ever. This is a powerful financial profile to build on going forward. Now before we shift our focus to the future of Holcim, I'd like to share with you an overview of Holcim's P&L statement and free cash flow post spin-off based on 2024 actuals. The P&L shown here is guided by the IFRS definition of continuing operations, which is the methodology that we will have to use and which was planned to be applied in the half year 2025 financials for Holcim post spin-off. There are 2 points that I would like to call out your attention to. First, this P&L does not yet reflect the results from the allocation of the current group debt between Holcim and Amrize. This will take place before the spin. After the debt allocation, the financing cost in this P&L might be subject to further changes. Secondly, the P&L contains the full 2024 corporate cost of Holcim before the spin-off. It is therefore not really indicative of Holcim's future in that performance. So as you can see, our operational excellence and cost discipline drove our superior profitability in 2024. Thanks to our strict P&L control, we were able to deliver an earnings per share of CHF 3.07. At the same time, powered by our strict balance sheet control and disciplined capital execution, we achieved a leading cash conversion of 57%. I invite you to visit holcim.com, where a more detailed set of selected historical financial information is available for you. Now I'm very excited to turn to the future of Holcim and our strategy NextGen Growth 2030. As Miljan inspiringly explained, we believe in our 4 key strategic drivers. First, focused investment in attractive markets; second, sustainability driving profitable growth; third, expanding high-value building solutions; and fourth, performance culture and value creation. This is our exciting future. This is what our teams are mobilizing behind from Europe, Latin America to Asia, Middle East and Africa. By executing on our 4 strategic drivers, we will enhance our leading positions, thanks to our sustainable offering powered by premium brands. Circular construction and decarbonization will drive further profitable growth, expanding high-value building solutions will capture new profitable market segments, and we will continue to pursue value-accretive M&A with focus on the most attractive markets. And our embedded performance culture will deliver superior financial performance. All of this translates into the following financial targets for 2030: a net sales growth of 3% to 5% on average per year in local currency, a recurring EBIT growth of 6% to 10% on average per year in local currency, a cash conversion rate of 50% on average and a net sales split between Building Materials and Building Solutions of 50-50. The execution of our NextGen growth Strategy 2030 will provide Holcim with a total capital deployment capacity of up to CHF 22 billion until 2030. In order to ignite further growth, we will deploy this capital strategically focusing on growth as well as shareholder returns. Let me guide you through the main levers. The first one, we're investing CHF 4 billion to CHF 5 billion in growth initiatives to drive profitable growth. This will future-proof our business. Secondly, this also includes CHF 2.5 billion investment in our sustainability road map in energy, formulations and carbon capture. All of these projects have very high returns. We will invest further CHF 3 billion to CHF 4 billion for acquisitions that complement our unique portfolio and expand our addressable market. We will spend CHF 400 million to CHF 500 million per year on so-called bolt-ons. Despite our growth investments, we remain committed to rebased progressive dividend and returning substantial value to our shareholders. Including this year, we will return a total of CHF 7 billion until 2030, corresponding to a payout ratio of approximately 50% per year. An additional CHF 4 billion to CHF 6 billion coming from proceeds of larger divestments or our available debt capacity could be deployed. These funds will be used for large strategic M&A opportunities or to opportunistically execute share buybacks in the case of excess cash. So in summary, we believe that our growth-focused capital allocation will further accelerate profitable growth while delivering attractive shareholder returns. At Holcim, it is in our DNA to be deeply committed to delivering superior performance while we create value for our people, for customers and our shareholders. Now let's shift our focus to Holcim's future balance sheet. We will split the forecasted 2025 net financial debt of the current group without 2025 impact of any acquisition and divestments between Holcim and Amrize before the spin and in relation to their forecasted 2025 EBITDA. Logically, this is equivalent to an equal leverage for both companies. With this, we expect a strong Baa1 rating from Moody's and Standard & Poor's actually just this morning confirmed the BBB+ rating for Holcim post spin. For year-end 2025, we can give an indicative net debt leverage of 1.1x and a net debt of approximately CHF 4.4 billion. We at Holcim remain committed to a healthy balance sheet and a net debt leverage of below 1.5x. This will provide Holcim with sufficient financial flexibility, the ability to navigate all economic cycles while continuing to invest in profitable growth and attractive shareholder remuneration. And to close this presentation, let me reemphasize what Miljan shared with you before. Holcim has been and will continue to be a highly attractive and compelling investment. Today, Holcim is a leader in the most attractive markets with leading sustainable offerings for our customers. This enables us to capture the tailwinds from powerful megatrends shaping the future of construction. We are unlocking significant growth opportunities across our geographies and in our Building Solutions segments, which will enable us to achieve above-market growth. Our talented people and performance culture will continue to deliver superior financial performance and value creation. All of this will allow Holcim to continue driving shareholder value through growth-focused capital allocation and attractive cash returns. Now I'm delighted to invite our Head of Investor Relations, Bernd Pomrehn, on stage, and Bernd will open the Q&A for you. Thank you.

Good afternoon, everyone. I'm Bernd Pomrehn, Head of Investor Relations, and I'm very pleased to lead you through our Q&A today. [Operator Instructions] Now I would like to ask Miljan and Steffen to join me on the stage again. We will first take questions in the room. If you have any question, please raise your hand and then we will hand you a microphone when it's your turn. I see many, many hands already up in the air. Let's start in the middle, Arnaud Pinatel from On Field, please.

It was very clear presentation, which was very clear. My first feeling is that when I look at your net sales guidance, knowing that 54% of your operation will be in Europe, that most companies have in mind that we are currently at a trough in Europe and that we could see much more recovery in the coming years, knowing also that part of the decarbonization story is the ambition of the cement industry to double cement price over the next decade. It sounds like 3% to 5%, including 1% to 2% bolt-on impacts, which would imply a 1% to 4% organic growth is relatively cautious. Am I right? Or are you voluntarily relatively cautious to overdeliver? Or is it really realistic with this guidance in your view?

Look, thank you for the question, of course. But when we were setting these targets, we were counting all the potential divestments like we signed Nigeria. And I still believe 3% to 5% of net sales is a reasonable ambitious and challenging target for us. But for us, what's even more importantly is our ambition to go up to double-digit EBIT growth. And yes, if there are some upsides, as you have seen in Europe, since you are mentioning Europe, we have seen some announcements like German infrastructure deal, this could be definitely a significant upside in the years to come.

Arnaud Lehmann, please.

Am I allowed 2 questions?

Yes, you are allowed. Amazing, I'll pass it back to him.

Arnaud Lehmann from Bank of America. Firstly, your decision to separate concrete from cement and aggregates. I've always learn that vertical integration is a key driver of value creation in the industry. Why did you decide to do that? The second question. I mean, you've hinted several times that M&A will be a part of the strategy. You've got some future and current cash flow available for that. Could you firstly remind us the key products that you already have in solutions ex concrete? And secondly, what products are you interested to in terms of expanding into new product category?

Thank you for the question. So ready-mix. Ready-mix, I think the reason why we moved the ready-mix under the -- one of the key reasons was that ready-mix is evolving. Five years ago, when we were talking to engineers and architects, the requirement for ready-mix was C25 or C40 specification related to mechanical and physical properties of the concrete. Today, and you have seen some of the projects that we have shown today, for example, Canary Wharf, when the specification came out they specified ECOPact. It is the product that is used on the construction side. It is our first contact to the customers. And we believe that every -- we can see more opportunities for upside and cross-selling if we can provide a fully integrated end-to-end solutions to our customers from foundation and flow all the way to the walling and roofing systems. Regarding Building Solutions, excluding concrete, which we call the Building Systems, today, we do have strong platforms across all our geographical footprint. If you recall, we have developed -- today, we have a well-established mortar business. We started this with acquisition of PRB in France and then we have acquired several companies in Latin America, and we expanded in some other parts of the world. In addition to mortar, which we call Walling, we do have our roofing system. Some of this has been inherited from Elevate, the other we did in the last few years, several acquisition. Last one was ZinCo. This is where we are supplying green roofs to our customers. And this is also, we believe will have a significant potential to grow. Then we do have precast companies around the world, from Germany all the way to Australia. And we are seeing that this modular approach is gaining momentum everywhere.

Let's stay in the first row, Cedar Ekblom from Morgan Stanley, please.

I just wanted to dig a little bit into the sort of portfolio journey over the next couple of years and how that relates to capital allocation. And I'm looking at your Slide 49, which is really helpful just in terms of how you plan on allocating the cash. So if we look at the revenues today, I think you're saying that about CHF 6 billion of the revenues is your solutions business, sort of 34%. And if we then assume the midpoint of your growth, we get to about CHF 10 billion of revenues in 2030. So the first question is, how do we think about how much of that is driven by organic growth and how much of that is driven through M&A? Because if I look at this CHF 3 billion to CHF 4 billion acquisition sort of slice, right, I assume you're not going to be buying businesses for 1x EBITDA sales, would be nice, but probably unlikely. And then the other question is just 2 items I'm trying to identify. One is maintenance CapEx and the other is lease cash calls. I think the lease number now is about CHF 300 million. How much of that goes with Holcim and how much of that would go with Amrize to understand what that cash call is there. And then the maintenance CapEx, I think, is not in the slide. And I just want to confirm, has that been taken out of the CHF 18 billion to CHF 22 billion already? And a bit of guidance on that would be helpful. Just to really understand what's left over, how much of this CHF 4 billion to CHF 6 billion is really left over for incremental growth?

Thank you, Cedar, for this simple question. Let me start on the Building Solutions, and then I'll hand it over to Steffen. So we are -- we have the platform. We are expanding, M&A will definitely play an important role in all of this. I would say that more than 50% of the business that will be generated will be generated through M&A activities. What you are seeing on this slide, when we talk about CHF 3 billion to CHF 4 billion, we are talking about bolt-ons relatively small- to mid-sized businesses. On the right-hand side of this slide, you can see the opportunities we have with additional deployment of cash to go for these big strategic transformational M&As. Steffen?

Yes. So good question. So the capital deployment is the free cash flow after leases. Leases are the group today around 400. Holcim in the future around, 200 roughly to give you an indication there. So it's the free cash flow after leases. And then, of course, we add on to that. And then we take -- it is also after maintenance CapEx before growth CapEx, split here 60-40, 60 growth, 40 maintenance. And then, of course, it includes the CHF 18 billion to CHF 22 billion, the debt capacity that we got, as I mentioned, with the BBB+ credit rating. So we know exactly where these windows are. So it includes the debt capacity and it includes certain income from divestments. So that is the whole envelope of CHF 18 billion to CHF 22 billion.

So the CHF 18 billion to CHF 22 billion includes divestments and includes debt capacity?

In the latter part, you see the 4 to 6 that we broke that out specifically because this is a part that is for us, not so straightforward plannable. So this is more opportunistic, if we can sell businesses or if we decide to lever up. So this is this very right most bucket, the 4 to 6, this contains the divestments and this contains additional leverage.

The next question, let's go to Pujarini from Bernstein.

So on the flip side of the last question, so we are -- I mean, right now at around CHF 10.3 billion of revenues from materials. And if we go to 2030, it's roughly around the same level at 4% growth and 50% of that coming from materials. So basically, are you suggesting that you're not expecting any growth from the materials business, surely not, right?

On contrary, we are going to continue to grow in our Building Materials business. As I mentioned in my presentation, this is actually a foundation of Holcim. This is what we are built on. We have to assume that there would be potential divestments in this business. We already signed the deal. And on the other hand, we will see a more overproportional growth in Building Solutions. But definitely, both business segments have the huge potential for growth, and this will come organically and through M&As.

Next question from Isabella Baxter from Deutsche Bank, please.

So 2 questions, please. LatAm represents roughly 20% of your revenues, and you make some of your best returns in Mexico. So I was wondering, should we expect LatAm to grow going forward? And does the region offer any opportunities as attractive as the ones that you enjoy in Mexico? My second question is, could you walk us through the economics of buying recycling centers in Europe? What multiples have you been paying? And what are the margins like?

Thank you. On LatAm, it's definitely one of our most exciting regions. You have seen that we are generating EBIT margins of 34% with extremely strong cash generation. And all of this is repatriated back to Switzerland. So this region has been and will continue to be our main focus. We are now ready to take it to the next level. And yes, I would expect over proportional growth in LatAm, which is driven by all these megatrends that I have explained in the presentation. And in the next few years, I would expect LatAm to be significantly bigger and taking a significantly higher portion of our total sales. Second question was in relation to recycling. Construction and demolition materials recycling has become now officially one of our most attractive growth opportunities. So if you look at what is happening, especially here in Europe, landfilling cost skyrocketing, there are new norms and standards that are actually preventing a landfilling. So this is where we come into the play. Holcim, thanks to our strong footprint in all the metropolitan areas, we are well positioned to capture these volumes to use them, to recycle them and even more importantly, upcycle them. And then we can use this material in our own operations to produce ready-mix, to produce asphalt, to produce cement and mortar. And this business because of the -- we can provide all end-to-end service to our customers, potential customers as well, it's highly profitable. We are seeing that the margins in these businesses are now varying well above 25%, and we will continue to heavily invest in this area.

Let's take the next question from Ross Harvey from Davy, please. Last row, if possible.

So hoping to go in a little bit more into the Building Solutions and the exciting forecast for there. You mentioned that M&A is going to be a big contributor to the growth. As we look at this new segmentation, you have Building Systems and then the concrete and surfacing, and it sounds like the Building Systems is going to be an important part of the growth. So when you look at that between roofing, walls, mortar, when you look at that by geography, clearly, there's a lot of growth expected. So does it depend on deal availability? Have you got specific areas that you're looking at, at the moment by region? Just expand a little bit more, please, on the M&A growth in that Building Systems. And the second question, actually, if it's -- if you can add that in now, you've given targets for revenue, for profit, for cash conversion. And I think the other quadrant that you had in one of the prior slides was returns. So maybe just comment on, do you expect a major change in returns over that forecast period out to 2030? Or where should it land relative to the 11% currently?

I'll tackle -- thanks, Ross. I'll tackle the first question and then you handle the ROIC one. So if you saw the slide on the capital deployment, we are expecting to continue with bolt-ons of approximately, let's say, CHF 0.5 billion per year. And this will be a mix of Building Solutions and building materials. And we expect in the years to come, Building Solutions will become more prominent. So if we say that at the beginning, it's an equal split when it comes to M&A, as we are heading towards 2030, we will see acceleration. If we look at the different regions, I think LatAm, the market is still highly fragmented. And here, we have enormous opportunities to buy small to midsized businesses that are active in waterproofing, roofing, ceiling, mortars. And thanks to our presence in Disensa, which is the largest retail franchise in LatAm, we already have sales points. So integration is relatively quick. And therefore, when you look at the multiples, they are very, very attractive after synergies.

So the question on ROIC. So first reminder for everybody, our ROIC today is 11.1% with a strong increase over the last couple of years. Also important to know, one key criteria for us to approve an M&A project is that this company needs to achieve the group ROIC in the third year. And we monitor that very closely. This is one of the key knockout criteria for doing M&A. So our M&A needs to be ROIC accretive. Now if you ask me where we're going to land in the future, we didn't spell out a specific target, but I would say that the past track record is going to build into the future. So you can say until 2030, it's going to be a growth somewhere between 200 and 300 basis points.

Maybe let's do a step to the left. Elodie Rall from JPMorgan. Elodie?

First of all, on your ambition by 2030. So we understand there's going to be a lot of M&A involved. You've also talked about divestments. Exactly where do you see the geographic footprint for Holcim by 2030 split between Europe and the diverse regions? If you could give us a bit more color. And you mentioned some divestments. So are there some that are ongoing that you could maybe comment at the moment? Second, on the Slide 39 on the leadership team, you showed the leadership by regions, but I was wondering how you will ensure that the group can deliver on that 50-50 target between Building Mat and Building Solutions given there's no head of each of the divisions? And lastly, if I can throw it, just a quick last one on buyback. So clearly, it's part of the ambition, but there's no current plan in place. Are you waiting for the spin-off to announce a new program?

Thank you, Elodie. On the geographical footprint, I would say that Europe will still remain the biggest chunk of our business in 2030, maybe around 50%. And then definitely, LatAm piece of pie will significantly increase versus Asia, Middle East and Africa. On the question regarding the P&L leadership, well, we have that already today. I mean, in each country where we operate, we do have dedicated leaders for each business segment. And these people have their own KPIs related to the business they are running and also the KPIs based on the performance of the whole company. So to me, this does not change anything. What we did is we introduced more P&L responsibilities on the regional level in Europe because now in Europe, it's all about execution of all these big decarbonization projects, and we want to see more focus from these 2 P&L leaders who are, by the way, with us today on West and East Europe. And regarding the last question, share buyback, why don't you take it.

You saw on the chart (sic) [ slide ] 49, Elodie, that we said share buybacks are opportunistic. And this is also how we treated them in the past. We think this will be pretty similar in the future. The last 2 share buybacks, the CHF 2 billion one we did, it came from proceeds of the sale of a large country of our business. So we used these proceeds to give back to shareholders. And the other one was because we had exceptionally good results in that year and no other M&A opportunities. That's why we announced the share buyback. So these are typically the reasons why we would do share buyback is from excess cash without an appropriate investment opportunities. And when we come to that situation, we will announce the next program.

Let's take the next question from Luis Prieto from Kepler Cheuvreux.

Apologies, I'm a bit confused by the overwhelming amount of information. But I would like to get some clarification regarding the CHF 4.5 billion of growth CapEx and the CHF 3 billion to CHF 4 billion of acquisitions. I'm insisting on the same. But what amount of those numbers is devoted to steering the boat towards that 50-50 materials versus solutions? I don't know if I'm wrong looking at it this way, but what money do you need to spend to be able to reach that 50-50? And then the other question -- the other amount, obviously, would be to grow the business as a whole, static 50-50, but how do you steer away? And the second one is coming back to the disposals, potential disposals, how difficult is it to sell a business in the Asia Pacific, Middle East, et cetera, which is obviously the one that is not in bold letters in your presentation. Do you see -- and apologies for the question, but do you see people calling you, I would be interested in this? Or is something that is going to take a long time and then work from your end?

Thank you for your question. I'll start with the second, and then you can answer the first one. So how easy is to sell the businesses in Asia, Middle East and Africa? Well, we have a proven record. I mean we have completed 100 deals since 2018, including 20 divestments. So we divested a few large footprints, and we also last year divested some countries in East Africa. There is no general rule. We do have a system in place that has been working well. Sometimes it does take time because this does not happen overnight. But I believe that in each case, you need to be flexible when it comes to the approach and how you're going to tackle the whole selling process.

For reaching our ambition of 50-50, we -- indeed, we need some organic and we need some M&A, maybe 2/3, 1/3. We talked about -- we talked about bolt-ons before. We have these bolt-ons in there. I said CHF 400 million to CHF 500 million. I would say 1/3 to 1/2 of these bolt-ons will be dedicated to that. Maybe that gives you a pretty good feel. And then bigger deals, as we all know, they really depend on the availability. So if there was something, of course, that could accelerate our journey, but that is part of the right most part of that chart that I explained, so it's really a good portion of the bolt-ons that will be dedicated to that.

But there's no obviously big M&A included in that target at all. It's -- with the numbers on the left, you reach 50-50, there's no -- you could expect...

Well, we will use some of that also to get there. But as I said, it's a floating mix between organic and M&A, 2/3, 1/3, but half-half at some time that's...

We take the next question from Martin Husler from ZKB. Martin?

Two questions, if I may. First of all, can you talk a bit about your relationship with Amrize, for example, when it comes to cement export into the U.S., are you obliged to go through Amrize network? Or could it be possible that you kind of increase your exports to the U.S.? First question. The second one on the CO2 reduction target to below 400 kilogram per tonne. I think I remember that in November '23, you mentioned that in Europe, your ambition is something like 285-ish. Is this still valid? Or do you have a different target now for the European reduction target?

Thank you, Martin. Amrize, today, we are exporting cement and clinker to U.S., and this is going through our Holcim trading organization. We will have agreement in the place in the future. I believe that for us, this is not -- we are not banking on a long-term future that we export. We continue to export large quantities. Algeria is our biggest export hub, but thanks to the local growth momentum now, our main focus is supplying local market versus the export. So in the future, we will see how it goes. But remember, on the day of the spin-off, we will be 2 completely different companies, and we might go through Amrize or we might go directly supply some customers. Regarding CO2 commitment for Europe, this does stays. It remains as it is. There could be some changes. If you recall, last year, we have received another funding from EU Innovation Fund. So this could be an upside if we can commission this project by 2030.

Let's take the next question from Remo Rosenau from Helvetische Bank.

Again, about this 50-50 split. Obviously, M&A involved, as we discussed now. One element, of course, in order to get to 50-50 are disposals, which are also part of M&A. And it's much better plannable -- a bit better plannable than acquisitions, at least you have a better idea about what you would like to dispose. I mean, if you would be able to dispose what you have in mind to dispose, what would the split be now?

So look, Remo, we -- today, we have one signed agreement that is Nigeria. And I would not go into details about the potential plans. Most of our divestments with Nigeria would have been completed. There could be a few additional positions relatively small, where I don't see Holcim having the future in the long term. So divestment is definitely included, but at the moment, we would like to stick on the one that has been signed.

Because without disposals, your target 3% to 5% growth, 6% to 10% EBIT growth are explicitly excluding large M&A. Of course, there would be some large M&A needed in order to get to this 50-50, which will be in the solutions side, which has, by nature, lower capital intensity and lower margins. So there is a dilutive margin impact growing this. So if you would not do any disposals, the growth target of 3% to 5%, you would come up with higher numbers at the end of this 6-year period. But on the EBIT, the EBIT margin will not go up.

You have to include the potential synergies in all of this. I mean, yes, maybe ready-mix has a lower margin than our traditional cement business. But look at the consolidated margin, we are selling cement into ready-mix. So this is definitely an upside. The same applies for our precast businesses, for our mortar businesses. The key ingredients to make a mortar product or to make a precast product is sand, cement, okay?

And we demonstrated that also, Remo, when you look at the businesses we acquired both well, formerly in the U.S., but also in Europe, the margin expansion that we were able to achieve once we had this business and could realize the synergies are quite satisfactory.

Okay. Last one, the net debt-EBITDA indebtedness you showed, is that including already the disposal of Nigeria?

No, we did this explicitly without any M&A. So this is a net debt number without any M&A. So bolt-ons, you need to subtract. Divestments, you need to add.

Next question comes from Gregor Kuglitsch from UBS, please.

So maybe sort of 1 or maybe 1 or 2 bigger questions and then 2 small ones. So on the M&A and the sort of strategic, I think you called out a few times potentially sort of larger deals, I think, particularly in Europe. Can you just give us an idea of the size and how -- kind of what direction you're leaning in? Are you thinking cementitious sort of downstream value chain? Or would you go sort of a little bit like what Holcim did back 5 years ago to go into something completely different, which was roofing product, which is obviously not in the cementitious value chain? So that's question one. Question 2 is on Europe and decarb. Just give us an idea sort of you didn't go into a lot of detail. I appreciate there was a decarb day a few years ago. But what you're thinking of unit profitability 5, 6, 7 years out once the free allowances really sort of phase out? What do you think can happen? Can this go up 20%, 40%, 50%, 100% for you as a firm? And then maybe 2 small ones. Steffen, you said the overhead cost is fully loaded because basically you're absorbing the entire cost, I think it's like CHF 400 million, CHF 500 million. Can you give us an idea what that should be and how quickly you can get there? And then on that debt slide, where you're sort of saying 4 point, what did you say, 4.4 divided by 1.1 is obviously 4. And you also had 4 last year. So you basically -- is that a sort of guide for EBITDA? Is that just -- are you just actually using last year's EBITDA, so we shouldn't read into anything into that?

I'll start. So when it comes to M&A deals, Gregor, we are talking about -- when we say large deals, deals greater than CHF 200 million companies with CHF 200 million revenue. We would like to stick with our existing platforms, which is walling and roofing. When we talk about walling, we are talking about energy-efficient systems from attics to precast panels. And on the roofing side, yes, this is our tradition of what we have at the moment in roofing, maybe more focused on green roofs. On the Europe profitability, well, we have seen that in the last 3 years, our margin expansion exceeded 300 basis points. I would expect that we continue the strong trend given the initiatives we are deploying across all our footprint in Europe to decarbonize using innovative formulations, using energy transition initiatives. And of course, where eventually we will be deploying and commissioning all these 7 large-scale carbon capture projects. So I would expect something similar to what we have seen in the past to continue in the future.

Yes. I think the question was on overhead. Yes. So of course, we took -- people are hired in Switzerland. We took this on. Currently, a run rate 2.5% to 3%. By the end of 2026, we will come down back to 2%, where we've been historically. Then you asked if you can make a simple math dividing the debt leverage by the -- debt by the debt leverage. Not exactly because it's without M&A. And also you have to calculate the FX if you want to get to an organic growth rate. But by and large, yes, it's not far off. So if you exclude -- if you put the organic on and the FX off, then basically you will have right around there.

Jean-Christophe, please?

I have a question regarding your conservative target of 6% to 10% EBIT margin growth. Coming back to your cement cost metric, if we look at the top of the cash costs in 2022, 2023, we have now a strong decrease in pet coke pricing and also in electricity pricing. So probably if the volumes stabilize, we could still have strong leverage effect this year and next year, all things being equal. Can you elaborate more? Because I think we could have a further EBITDA margin increase in Europe, thanks to this.

Just yes. But keep in mind that in Europe, we are actually phasing out our traditional fossil fuels with alternative fuels. So if you have seen the slide that I presented on Europe, you see in the last 3 years, let's say, in Europe, we had somehow softer market conditions. But Holcim continued to grow and continue to grow over proportionally. This is because of our decarbonization initiatives. This is because we are not relying on traditional fossil fuels and so on. So I think for us, we will continue to head in that direction. We know what are the key strategic priorities. And yes, we can deliver even more in the years to come.

Let's maybe stay in the first row.

Sven Edelfelt, ODDO. I would ask 2 questions, please. First one, I would like to come back on the spin-off. Can we have a sense on how the share split is going to happen? Is Amrize going to be dividend distributed? And how is it going to be done? What will be the key metrics there? Second question, a clarification on the payout. You mentioned a 50% payout. Is it 50% on the free cash flow or on the net profit?

I will, maybe you start with the payout.

Yes. So we -- a dividend is, in our case, is a decision at the Board's discretion. So what we as management, we recommend the dividend to the Board. We look at the payout ratio from net profit. This is what we meant here. And -- but we also look at yields. We look at yields in different benchmarks. And so we paint a complete picture for the Board, and then it's their discretion to go along. But I would say the 50% payout is a very, very important number. This is why we put it into here.

To complete the answer, I would see Amrize more focusing on share buyback in the future, while Holcim is more higher payout ratio. And they have presented something like that.

Then we have a question here on the left, please. Michael Betts, please.

Yes. Thank you very much. I believe I've only got one question. Concrete historically has been a very low-margin business for Holcim and to be frank, for everybody else. You're trying to expand Building Solutions, a big chunk of it is going to be concrete. How are you going to get that margin up is my question?

Good question. So you've seen that, as I said earlier, we believe that concrete is evolving. The concrete, what used to be 5, 6 years ago, when we were talking to engineers and architects, we were talking about basic properties of concrete. Today, concrete that Holcim sells, and we want to sell more of this in the future includes carbon footprint, includes the amount of recycled material. And exactly, that's why we want ECOPact to be by 2030, 50% of our total net sales in ready-mix. And why ECOPact? Because selling these products, we could ask for price premium and also thanks to our formulation and production know-how, we are able to reduce the cost. I believe that concrete will drive this industry in the future when it comes to decarbonization. And what's equally important that we need -- this opens opportunities to innovate in ready-mix in concrete. And that's how the margins will continue to grow.

Ebrahim, please for next question.

I have one about the branding. We know that ECOPact and ECOPlanet will stay on Holcim. What about Elevate because you showed a slide with Elevate, Amrize did it also Tuesday. So what about it?

Yes. On branding, ECOPact and ECOPlanet and ECOCycle will stay with Holcim. We -- this is mainly developed in Europe. We have a strong market share in LatAm. In the U.S., we do have a unique brand that is for U.S. market called OneCem, and that will remain with Amrize. Regarding Elevate, we've got 2 years to decide how we're going to transition this.

Any further questions? Arnaud Lehmann, please, again.

And sorry to put you on the spot. I don't know if you might have seen the information, but there are discussions in Nigeria about the disposals being maybe challenged by the local authorities because they're complaining that you might be selling to Chinese companies. Have you seen this information? And if this disposal does not happen, would that put future buybacks at risk?

Look, every single divestment we did in the -- since 2018, there have been discussion on the local level about something not going according to plan. So we run -- we signed the deal. We are running the process, and we will see what happens. Regarding -- if it doesn't happen, it will not -- I don't think there will be any significant impact on our future plans.

And staying on Huaxin, if I may. You've been selling quite a few of your assets to them over the years. It's becoming quite international. Do you plan to remain a long-term shareholder in the business?

At the moment, we have no plans to exit. We will leave the things as they are. As you know, China has not been an easy market in the last 4 years. It did not have a significant impact on Holcim because we are not consolidating. But now what we are seeing are positive signs in China. So we will wait and see what the future will bring.

Let's take probably our last question from Cedar. Cedar Ekblom again, please.

Just a follow-up on Slide 26, where you've got the green opportunity, expanding profit and shrinking costs. How should we think about the type of premium that you think you can get from a truly net zero cement? I know it's a couple of quarters, years away in terms of introducing it to the market. But from a wholesome perspective, what do you think you need in order to make your decarbonization project work?

Look, when we do our business plans, we do analysis, modeling based on different ranges, CO2 price, EUR 100 up to EUR 250, EUR 200. And also, we do the same with the premium pricing for net zero, let's call it, near zero cement and concrete. I would like to be conservative and say 25% to 35%. However, I am convinced that on some mega projects with some big customers, they are willing to pay double, maybe even triple for near zero and net zero cement.

Perfect. And then if I could just have one follow-up. So when we think about price discovery for this truly net zero cement, it's probably going to take time to really understand what the right price is for the product because at the beginning, the product market will be in its infancy. How long do you think it will take to work out what the right price is for that product? Do we need 2 million tonnes of green cement in the market? Do we need 5 million tonnes? I don't know if you have a perspective on that.

Look, our commitment is to go up to 8 million tonnes by 2030. At the moment, I don't think I can give you a clear answer. We need to wait and see how the market develops. And maybe the market will not be asking for net zero. They might be asking for 80% reduction, and we will base our pricing based on that. I think it's a bit too early to give exact pricing predictions for near zero and net zero cement. But our commitment is there. We are deploying. We are scaling up. We are working on all these projects, so 7 of them in total, and this should be around 8 million tonnes of, as I said, near zero and net zero cement.

Perfect. Okay. One very last question.

My name is [indiscernible]. I have 2 questions regarding Elevate. They have also operations in Europe. Are you taking over these operations in Europe from Elevate? That's the first question. And how much of your profit was impacted by the spin-off in '24 on the operating profit level? And what will be the impact in '25?

Yes. We do have our Elevate business in Europe. That will remain with Holcim. And it's not only Elevate. If you recall, in the last few years, we have acquired a few companies in roofing space, FDT and more recently, ZinCo last year, and that will remain under Holcim umbrella. And we will -- this is included in our Building Solutions ambition 50-50 by 2030.

For the impact, we announced that number also at the full year earnings call. We had about CHF 96 million in 2024, which is recorded in one-off below EBIT, but it impacts our EPS. And we said that altogether, it will end up at around CHF 170 million. And the remainder, this is mainly accountants, auditors, lawyers, all of these things, but also rating agencies, all the good things that we do for the spin-off. I think I know you asked the question for a different reason, we answered that.

Perfect. Thank you so much. This concludes today's Q&A. Thank you so much for joining us on our exciting journey. If you have any further questions, obviously, please feel free to follow up with the Investor Relations team. And with this, I would like to hand it over to Miljan for some closing remarks.

Thank you once again. Thank you all for coming and joining online. I hope you are equally excited about the prospects of this remarkable company. I'm looking forward working with my team that you will meet on achieving our NextGen Growth strategy. And just if I pause and look at Holcim, I mean, we will continue to leverage our excellent market positions from LatAm, Europe all the way to North Africa and Australia. We are working really hard to expand our Building Solutions because this is the right thing to do. We are seeing a significant upside potential there. We want to accelerate our penetration into Latin America, which has been and will continue to be our most profitable region. And at the end, we are doing all of this to deliver the value creation, first of all, for our people, for our customers and also for our shareholders. Once again, thank you very much.