Holcim Earnings: Strong Performance Enables New CHF 1 Billion Buyback and 12% Dividend Increase

Narrow-moat Holcim’s strong fiscal 2023 results reflect the successful execution of its strategy to grow a diversified building materials business, which is focused on mature geographies that exhibit higher barriers to entry and superior growth. Shareholders have been rewarded with a 12% dividend increase and new CHF 1 billion share buyback program, translating into a combined capital return (dividend plus buyback) yield of 6% based on the current market capitalization. Guidance for organic revenue growth above 4% and a further 40-basis-point margin expansion to 18% during fiscal 2024 reflects the group’s favorable geographic positioning and ability to grow market share through its low-carbon-branded product alternatives. We maintain our CHF 60 fair value estimate and view shares as fairly valued.