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Innovation 25 Siam City Cement has developed a new type of mortar cement known as “INSEE Gold”, which can be processed more easily: masons are able to plaster walls more quickly and using less material; losses of materials are significantly reduced and walls have fewer cracks after hardening. This new type of mortar now covers around one third of the Thai mortar market. Aggregate Industries UK has <strong>success</strong>fully launched Bardon Superflex, an asphalt developed jointly with BP Bitumen. The new product provides considerable advantages when carrying out surfacing and strengthening work and has won an award for innovation. These examples from the Group companies illustrate Holcim’s innovative capacity and close proximity with the market. Maintaining client proximity with innovative offerings Market studies and surveys are conducted regularly. This mainly falls within the remit of the Group companies; however, they are supported by the responsible corporate staff units at the Group level. In the emerging markets in particular, a number of Group companies have introduced new sales models in the cement segment. Complete product packages are offered through networks of retailers. A good example is Ecuador, where our Group company has refined the “Disensa” franchising concept, bringing Holcim Ecuador closer to end customers through retail traders. In addition to Holcim’s range of cements, these retailers supply a broad product range for all aspects of housebuilding. This gives tradesmen and developers direct access to Holcim Ecuador’s full range of products in a single sales outlet. Through a special credit card system the retailer benefits from favorable payment terms. This year, end customers have also started to be offered microcredits. At Holcim Apasco in Mexico, this sales method was introduced some time ago under the name “Mi Casa” for people building their own homes and “Mi Obra” for small and medium-sized businesses. “Mi Casa” customers are provided with building instructions and plans and can contact a call center for advice and information. Microcredits are also available. This overall concept is now being transferred to other countries. In the wake of the tsunami disaster, Holcim Indonesia introduced “Solusi Rumah”, a comprehensive package of solutions for the construction of robust, low-cost homes, based on simple, but earthquake-proof system building. Customers can purchase construction materials and tradesmen’s services at small and mediumsized businesses licensed by Holcim and can also access finance from local banks. Another new feature is that all products from the foundations to the roof tiles are concrete or cement-based. Research in the fields of process technology and alternative fuels Holcim is also examining improvements and new technologies in the field of production processes. The focus here is on critical mechanical plant components with a view to enhancing reliability and streamlining investment costs. One example is the development of new drive system concepts for rotary kilns and vertical mills. Holcim is not only aiming to make progress on investment and production costs, but also to achieve top brand status in the environmental sector, where we engage in intensive cooperation with leading plant manufacturers worldwide. Holcim is a pioneer in the development of plants for the processing and use of alternative fuels and raw materials; a good example is the “Hotdisc” at our plant at Rohozník in Slovakia, which allows us to use coarsely formed alternative fuels directly in the rotary kiln. New technologies are not only increasingly enabling us to replace fossil fuels, but also mean that we can substantially improve the emission profile of our kiln systems. The Group is also making great efforts to expand the volume of waste materials recycled in the emerging markets. ˆ
26 Value-Driven Corporate Management Capital market information Holcim regularly makes active use of the capital markets to raise debt and equity capital. The equity base was strengthened to finance our growth strategy. We have also further improved the Group’s debt profile. The capital market responded very positively to the capital increase carried out in May. The Holcim share also saw an impressive 26.8 percent increase in price during the year under review thanks to the Group’s dynamic development and a friendly stock market environment. The share closed on December 31, 2006 at CHF 111.70 (2005: 88.06 1 ). Performance of Holcim share versus Swiss Market Index (SMI) CHF 140 CHF 120 CHF 100 CHF 80 CHF 60 CHF 40 1 Adjusted for the capital increase carried out in 2006. 2 Bearer share until unification of share structure (June 10, 2003), registered share afterwards. CHF 20 CHF 0 Holcim share 2 SMI (adjusted) 2002 2003 2004 2005 2006 2007
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Key success factors

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