2011 Annual Report - Italcementi Group

2011 Annual Report
Presentation 4
General information 15
Annual Report Consolidated Annual Report Directors’ report 28
Extraordinary session Italcementi S.p.A. Annual Report Consolidated financial statements 63
The international economy and industry trends
World economic trends in 2011 varied greatly, not only from one region to another, but also
from one quarter to the next. The first half remained lively, but was followed by a
significantly slower second half, due to financial stability risks in some euro zone countries,
the restrictive fiscal policies adopted in most of the euro zone, the more cautious monetary
policies in a number of emerging countries, as well as the geo-political unrest especially in
the Middle East. For the year as a whole, global economic growth, which in 2010 had
returned to more than 5%, was, according to preliminary estimates, once again close to its
long-term values (around 3.5%); the growth rate in the advanced economies (1.6%) was
half that of the previous year.
Raw material prices largely reflected the general cyclical weakening; nevertheless, oil
prices displayed a notable resistance to decline, influenced in part by the important
recovery of the dollar. Falls in exchange rates, weak stock markets and tighter capital flows
were the main features of many emerging countries in the last part of the year. Despite
widespread moderation in wages and salaries, in the advanced area inflation rose faster
than expected, due to the previous increases in the basic input prices and the rises in
indirect taxation imposed by fiscal austerity policies.
In the advanced economies, the deterioration in the macroeconomic climate hit the
construction sector in the final phase of the longest recession of the postwar period,
contributing, in many countries, to a further postponement in the upturn. Nevertheless, the
most evident feature was the divergence in the cyclical positions of the countries in which
the Group operates, both emerging and mature. Among the mature countries, there was a
moderate construction recovery in France and Belgium, while the southern euro zone
countries reported a further significant fall in activity. The USA was in an intermediate
position, with the recessionary pressures of the last six years probably fading, but signs of
a recovery, even from the very low levels reached, still appearing to be very weak.
In the emerging countries, the economic trends in the construction sector were generally
favorable; in some cases, however, signs of a slowdown emerged as economic policies
paid greater attention to avoiding excessive speculative bubbles in real estate. The Group
results in the area were also critically affected by events relating to the complex political
transition taking place in Egypt, whose influence was also felt in the construction sector.
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