WRAPUP 1-Hochtief and Holcim seek solace in Asia in 2012

Wed Feb 29, 2012 2:16pm GMT

Quotes

   

* Hochtief sees 2012 earnings rising almost to 2010 level

* Holcim operating margin improved in Q4

* Holcim posts Q4 net loss of 438 mln Sfr, better than forecast

* Hochtief 2011 pretax loss, 127 mln euros, in line with forecast

* Hochtief shares drop 4.8 pct, Holcim rise 1.7 pct

By Caroline Copley and Peter Dinkloh

DUESSELDORF/ZURICH, Feb 29 (Reuters) - German builder Hochtief (HOTG.DE) and Swiss cement maker Holcim (HOLN.VX) are banking on a growing number of building projects in Asia to drive demand in 2012, after charges at both companies hit earnings last year.

Infrastructure and residential construction projects in the Asia Pacific region will buoy demand for building materials, said Holcim, which expects to grow operating profit this year, excluding acquisitions.

The view echoes French rival Lafarge (LAFP.PA) which also expects 2012 demand to be driven by emerging markets. [ID:nL5E8DH081]

Essen-based Hochtief sees brimming demand in the mining industry fuelling construction projects.

"There are enormous amounts of goods such as iron ore and coal that have to be transported in Australia for which there is a need for traffic infrastructure," Hochtief Chief Executive Frank Stieler said on Wednesday.

The German builder is itself active in mining in the country through its Leighton (LEI.AX) subsidiary.

Global iron ore demand, chiefly driven by top importer China, has been outpacing supply, and there is a massive expansion ongoing by top miners Vale (VALE5.SA), Rio Tinto (RIO.AX) (RIO.L) and BHP Billiton (BHP.AX) (BLT.L).

Hochtief, 53.4 percent owned by Spanish builder ACS (ACS.MC), said it expected earnings for 2011 to get close to 2010's record of 757 million euros.

But the outlook for next year disappointed investors as the group signalled it would miss its goal of lifting pretax profit to over 1 billion euros ($1.34 billion). Hochtief shares were down 3.47 percent to 52.80 euros at 1352 GMT.

Analysts had already pencilled in a more conservative number for 2013, forecasting on average a pretax profit of 891 million euros for that year.

"Although new 2012 guidance fits to consensus estimates, we expect the downward revision of 2012 and 2013 (results) and the dropped dividend to weigh on shares," a trader said. Hochtief parent ACS plans to report earnings at 1700 GMT today.

Holcim shares were up 1.63 percent at 59.25 Swiss francs as investors were soothed by the Swiss company's somewhat brighter outlook.

"What is positive in our view is that the company feels confident already at this stage in the year to achieve positive organic operating (profit) growth," Helvea analyst Patrick Appenzeller said.

Holcim posted a fourth-quarter net loss of 438 million francs ($488 million), largely due to an already announced 775 beat analysts' forecast for a 521 million franc loss. [ID:nL5E8DO57H] [ID:nL6E8CG0SZ]

Hochtief posted a pretax and net loss for last year, and it said the results were hit by the difficult macroeconomic environment and problems related to some large infrastructure projects in Australia.

($1 = 0.7450 euros)

(Additional reporting by Maria Sheahan and Christoph Steitz; Editing by Hans-Juergen Peters)

((peter.dinkloh@thomsonreuters.com)(+49 69 7565 1345)(Reuters Messaging: peter.dinkloh.thomsonreuters.com@reuters.net)) Keywords: CONSTRUCTION EUROPE/

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