PARIS (Reuters) - French construction materials group Saint Gobain suffered a slump in annual net profits which the company blamed on asset impairments due to an uncertain economic outlook.
St Gobain said net attributable profits had dropped by 73 percent from a year earlier to 420 million euros (£364 million) after it booked 2 billion euros worth of impairments which it blamed on an uncertain economy and issues such as Brexit.
“The group reviewed its asset impairment tests in light of the current situation and the downward revision to the outlook for certain businesses and countries. The UK faces uncertainty due to Brexit in a more competitive environment,” St Gobain said in a statement.
Its free cash flow (FCF) fell 6.1 percent from a year earlier to 1.27 billion euros, although St Gobain hoped a strategy plan to simplify its portfolio of businesses and cut costs would improve results for 2019.
“For 2019, in the context of a market which, despite some uncertainties, should be favourable overall, we are targeting a further like-for-like increase in operating income,” said St Gobain Chairman and CEO Pierre-André de Chalendar.
Reporting by Jean-Michel Belot; Editing by Sudip Kar-Gupta