Annual Report 2010 Holcim Ltd M I

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Strength. Performance. Passion. d t Holcim is a worldwide leading producer of cement and aggregates. L Annual Report 2010 Holcim Ltd m i

Further activities include the provision of ready-mix concrete c l

and asphalt as well as other services. The Group works in around o H

70 countries and employs more than 80,000 people. 0 1 0 2 t

r Biodiversity is life o

p 2010 was the International Year of Biodiversity e R l a u n n A

Strength. Performance. Passion.

Annual Report 2010 Holcim Ltd

Holcim is one of the world’s leading producers of cement and aggregates. Further business activities are ready-mix concrete, concrete products, asphalt and a range of related services. The Group operates in around 70 countries and employs more than 80,000 people. For many years, Holcim has been doing pioneering work in the field of sustainable development, including the cultivation of fauna and flora at production sites.

Holcim today is more globally spread than any other building materials group and, with around 2,500 locations worldwide, very well positioned. Its consequent geographic diversification strengthens the Group during difficult economic times.

The local companies of the Group, founded 1912 in Switzerland, focus on optimum customer service, including innovative product-specific solutions. As a Group, Holcim applies global standards not only in production and distribution, but also in environmental and social responsibility matters.

The United Nations declared 2010 the International Year of Biodiversity. Holcim is also reporting on activities in this area in the current Annual Report. The Group promotes biodiversity at production sites and forged a valuable partnership with the International Union for Conservation of Nature (IUCN) several years ago.

Holcim had been confirmed as a member of the Dow Jones Sustainability World Index for the eighth consecutive year. It is recognized as one of the most sustainable companies in the building materials industry. Holcim is also listed in the FTSE4Good sustainability index. Financial Information 5 4 3 2 1 rate. fi fi statement of average rate; translated at income fi Statement of reserves. capital contribution for apayoutfrom Board ofDirectors Proposed bythe shares. average numberof weighted bythe Holcim Ltd to shareholdersof income attributable based onnet EPS calculation equity. shareholders’ divided bytotal Net fi impairment. amortization and depreciation, Net incomeplus gures atyear-end nancial position

nancial debt

gures Sales ofready-mixconcrete Sales ofaggregates Sales ofmineralcomponents Sales ofcement Annual cementproductioncapacity Earnings pershare Total shareholders’ equity Net financialdebt Cash flowfromoperatingactivities Net income–shareholdersofHolcim Ltd Operating profit Operating EBITDA Net sales (illustrative) inEUR key figures Principal Earnings pershare Total shareholders’equity Net financialdebt Cash flowfromoperatingactivities Net income–shareholdersofHolcimLtd Operating profit Operating EBITDA Net sales (illustrative) inUSD key figures Principal Holcim Group Key figures Payout/dividend pershare Earnings pershare Personnel Payout Fully dilutedearningspershare Net incomemargin Net income Operating profitmargin Operating profit E Operating EBITDAmargin Operating EBITDA Net sales Sales ofasphalt Funds fromoperations Net financialdebt Cash flowmargin Cash flowfromoperatingactivities Net income–shareholdersofHolcimLtd Gearing Total shareholders’equity BITDA 2 3 3 3 1 ntfnnildb % /net financialdebt 3 5 5 ilo 5. 4. 1. –1.6 +2.4 +10.1 +4.2 143.4 +3.6 +4.2 157.9 131.9 202.9 million m 136.7 million t 211.5 million t million t million t ilo U ,9 ,8 –2.1 +14.2 +3.0 –12.0 14,795 9,284 16,897 2,575 974 +3.0 9,090 +6.7 million EUR 2,651 1,842 857 million EUR 3,066 +12.1 million EUR 1,898 million EUR 3,270 13,995 million EUR 15,691 million EUR +5.0 million EUR –1.4 –10.0 21,402 –15.8 13,430 22,469 3,567 –1.3 12,088 1,350 +2.1 million USD 3,518 2,551 million USD 1,137 +7.4 4,248 million USD 2,518 million USD 4,339 19,387 million USD 20,820 million USD million USD CHF EUR USD –1.5 –1.5 81,498 80,310 CHF CHF 31.12. % ilo H 480 million CHF ilo H ,2 ,5 1. –18.2 –17.2 –10.1 1,958 –5.8 –4.6 –6.1 1,621 2,781 % –2.1 5,229 –2.5 million CHF 2,619 % 4,988 +2.5 4,630 million CHF million CHF 4,513 21,132 % 21,653 million CHF million CHF million t ilo H 1331,3 1. –9.9 –8.3 –17.9 –21.1 –5.9 13,833 –19.6 11,363 3,888 1,471 million CHF 3,659 % 1,182 million CHF million CHF ilo H 1112,4 –4.2 22,044 21,121 million CHF 3 0020 %±% ±% 2009 2010 1.50 1327.6 31.3 2113.2 12.1 594. 98+0.2 +9.8 41.8 45.9 0821.9 20.8 3862.8 53.8 .545 –21.5 4.52 3.55 .949 –25.2 –25.2 4.93 4.93 3.69 3.69 6918.4 16.9 061. 36–3.6 –3.6 11.0 10.6 .732 –18.1 3.26 2.67 . . 1. +5.7 +17.1 3.5 4.1 . 9.3 7.5 4 4 .00.0 1.50 8 0.0 480 like-for- like Contents Annual Review 2010 6 Shareholders’ Letter 10

Value-Driven Corporate Management 19 Key Success Factors 19 Organization and Management 27 Innovation 32 Capital Market Information 36

Sustainable Development 40 Environmental Commitment and Social Responsibility 40 Human Resources 45

Business Review 52 Group Region Europe 52 Group Region North America 60 Group Region Latin America 68 Group Region Africa Middle East 76 Group Region Asia Pacific 82

Corporate Governance 87

Remuneration Report 106

Financial Information 118 MD&A 118 Consolidated Financial Statements 129 Key Management Compensation 189 Company Data 201 Holding Company Results 208 5-Year-Review 217

Holcim Ltd Corporate Communications Roland Walker Phone +41 58 858 87 10 Fax +41 58 858 87 19 [email protected]

Holcim Ltd Investor Relations Bernhard A. Fuchs Phone +41 58 858 87 87 Fax +41 58 858 80 09 [email protected]

The German version is binding. 2 3

Milton, Canada: The rehabilitated quarry is now a Puesto Viejo, Argentina: The rehabilitated quarry showcase complex of wetlands, lakes, meadows and provides shelter for rare flora (see pages 64 to 67). forests (see pages 56 to 59).

Holcim sold more cement, aggregates and ready-mix concrete.

2 Consolidated key figures for Latin America Net sales in million CHF 3,442 Netsalesin%ofGroupturnover 15.5 OperatingEBITDAinmillionCHF 999 Cement and grinding plants 27 Aggregates plants 25 Ready-mix concrete plants 233 Personnel 12,710

Consolidated key figures for North America Net sales in million CHF 3,240 Netsalesin%ofGroupturnover 14.6 3 OperatingEBITDAinmillionCHF 460 Cement and grinding plants 19 Aggregates plants 97 Ready-mix concrete and asphalt plants 234 Personnel 6,668 2010

1 4 5 Annual Review

El Puente, Spain: The gravel pit, inhabited El Gara, Morocco: This reforestation of 200 hectares Lugait, Philippines: Children enjoy nature by thousands of birds, was designated a will contribute to combat desertification and to protect at the butterfly garden (see pages 78 to 81). zone of special protection for birds by biodiversity (see pages 72 to 75). the administration of Castile-La Mancha (see pages 48 to 51).

Consolidated key figures for Europe Consolidated key figures for Asia Pacific Net sales in million CHF 6,535 Net sales in million CHF 7,958 Netsalesin%ofGroupturnover 29.3 Netsalesin%ofGroupturnover 35.7 Operating EBITDA in million CHF 1,045 Operating EBITDA in million CHF 1,820 Cement and grinding plants 40 Cement and grinding plants 58 Aggregates plants 259 Aggregates plants 86 Ready-mix concrete and asphalt plants 636 Ready-mix concrete plants 403 Personnel 19,690 Personnel 38,172

Consolidated key figures for Africa Middle East Net sales in million CHF 1,098 Netsalesin%ofGroupturnover 4.9 OperatingEBITDAinmillionCHF 359 Cement and grinding plants 13 Aggregates plants 5 Ready-mix concrete plants 25 Personnel 2,213 6 7 Cement Profile Developments Cement is manufactured through a large-scale, complex In 2010,the volume of cement sold grew by 3.6 percent and capital-intensive process.At the core of the pro- to 136.7 million tonnes. In addition,4.1 million tonnes duction process is a rotary kiln,in which limestone and of other mineral components were sold, representing a clay are heated to approximately 1,450 degrees Celsius. rise of 17.1 percent.The increase in volume stems from The semifinished product, called clinker, is created by additional sales in Group regions Asia Pacific, North sintering.In the cement mill,gypsum is added to the America and Africa Middle East. In terms of quantity, clinker and the mixture is ground to a fine powder – Latin America just maintained last year’s level,and in traditional Portland cement. Other high-grade materi- Europe,deliveries declined as a result of the economic als such as granulated blast furnace slag,fly ash, situation.The positive overall trend also reflects capac- pozzolan and limestone are added in order to modify ity expansions in important markets and the full con- the properties of the cement. Holcim offers customers solidation of Cement Australia. a very wide range of cements and also develops customized solutions for special applications.

Aggregates Profile Developments Aggregates include crushed stone, gravel and sand. The aggregates segment experienced a sharp rise in sales, The production process centers around quarrying, with an increase of 10.1 percent to 157.9 million tonnes. preparing and sorting the raw material as well as Holcim posted gains in Latin America,but primarily in quality testing. Aggregates are mainly used in the Asia Pacific,where it benefited from the full consolidation manufacturing of ready-mix concrete, concrete of HolcimAustralia.The Group companies in New products and asphalt as well as for road building Zealand,Thailand and the Philippines also lifted sales and railway track beds.The recycling of aggregates volumes. Europe and Africa Middle East witnessed an from concrete material is gaining importance at overall decline in the aggregates business. However, some Holcim. Group companies delivered more crushed stone, gravel and sand,including Aggregate Industries UK and the companies in Belgium, Germany, Switzerland, Hungary and the Czech Republic.In North America, the aggregates business declined.

Other construction materials and services Profile Developments Globally,concrete is the second most consumed com- Sales of ready-mix concrete rose by 9.8 percent to modity by volume after water.One cubic meter consists 45.9 million cubic meters.The strongest growth was of approximately 300 kilograms of cement,150 liters of seen in Asia Pacific driven by the full consolidation water and 2 tonnes of aggregates.Concrete is a very envi- of Holcim Australia. Delivery volumes also increased ronmentally friendly, energy-efficient building material. in North and Latin America, with Canada, Mexico and Asphalt is a bituminous construction material used pri- Chile leading the way. Group region Africa Middle East marily for road paving.It consists mainly of aggregates just maintained sales volumes, while Europe saw a of differing grain size. Holcim’s service offering also 5.9 percent decline.The volume of asphalt sold was includes construction services and international trading. down by 3.6 percent to 10.6 million tonnes. Following the acquisition in Australia, this segment has gained in significance. 2010

Consolidated key figures for cement in 2010 Sales of cement Productioncapacitycementinmilliont 211.5 Million t

Cement and grinding plants 157 160 Annual Review Sales of cement in million t 136.7 140

Net sales1 in million CHF 13,948 120

1 Operating EBITDA in million CHF 3,755 100

Personnel 51,133 80

1 Includes all other cementitious materials. 60

1 Consolidated sales of cement 2010 per region en 20

Europe 26.2 million t 0 North America 11.1 million t 2006 2007 2008 2009 2010 Latin America 22.7 million t Africa Middle East 8.9 million t Asia Pacific 71.4 million t

1 Inter-regional sales –3.6 million t

Consolidated key figures for aggregates 2010 Sales of aggregates Aggregates plants 472 Million t Sales of aggregates in million t 157.9 200 Net sales in million CHF 2,495 180 Operating EBITDA in million CHF 530 160

Personnel 6,478 140

120

Consolidated sales of aggregates 2010 per region 100

Europe 77.6 million t 80

North America 39.2 million t 60

Latin America 12.2 million t 40

Africa Middle East 2.5 million t 20 Asia Pacific 26.4 million t 0 2006 2007 2008 2009 2010

Consolidated key figures for other construction materials and services in 2010 Sales of ready-mix concrete Ready-mix concrete plants 1,426 Million m3

Asphalt plants 105 50

3 Sales of ready-mix concrete in million m 45.9 40

Sales of asphalt in million t 10.6 30

Net sales in million CHF 8,107 20 Operating EBITDA in million CHF 228 10 Personnel 22,577 0 2006 2007 2008 2009 2010

8 9 In a challenging environment, Holcim sold more cement, aggregates and ready-mix concrete. Selective capacity expansion improves environmental and cost efficiencies.

Dear Shareholder

Economic upturn had a delayed impact on demand for construction materials In 2010, the global economy continued to recover,although not at the same pace everywhere. Many industrialized countries overcame the recession,and the emerging markets largely remained on a growth track – also strengthened by solid construction activity. However, in Europe and North America, the improving economic condition has yet to have much impact on the construction sector.The stimulus programs were not implemented consistently in all regions. In addition,periods of cold weather,heavy rains and tropical storms hampered construction activity in many countries.

Rising sales volumes Despite the challenging environment in many markets, Holcim increased its sales volumes.This volume growth is broad-based, with Group companies in all five Group regions contributing to the success.The percentage increase was more pronounced for aggregates and ready-mix concrete than for cement.This became particularly evident in our enlarged operations in Australia, where the new consolidated Group company Holcim Australia – a leading nationwide supplier of aggregates, ready-mix concrete and concrete products – was consolidated for the full year for the first time. Sales of ready-mix concrete increased above average in the rapidly growing major centers of Asia.

Effective cost management In light of the uncertain economic outlook,Holcim continued to adhere to its tight cost management in 2010 with the aim of safeguarding the substantial reductions in fixed costs achieved the previous year despite the commissioning of new production capacity.The Group companies indeed succeeded to reduce their fixed costs by a further CHF 312 million.This had a positive impact on the statement of income.

Higher turnover and only slightly lower operating results Consolidated net sales increased by 2.5 percent to CHF 21.7 billion,while operating EBITDA declined by 2.5 percent to CHF 4.5 billion.The decisive factors were amongst others the less favorable results of Holcim Apasco in Mexico and ACC in India.Holcim Apasco was hit by weak domestic demand,while in the case of ACC,the delayed commissioning of additional cement capacity led to higher production and distribution costs.In the aggregates segment, however, the Group’s operating EBITDA margin increased.

Holcim suffered the sharpest decline in its operating result in Europe. In the two Group regions North America and Africa Middle East, operating EBITDA margin could be increased.The operating result was up compared to the previous year in Group region Asia Pacific, where it benefited from the full consolidations in Australia and the positive business development in Indonesia.The operating EBITDA margin declined in this Group region; reflecting among othe r things the change in the product mix due to the full consolidation of Holcim Australia, as well as the temporary price pressure in India during the monsoon season. In Latin America, Holcim Brazil in particular improved substantially. Shareholders’ Letter

Net income decreased by 17.2 percent to CHF 1.6 billion and the share of net income attributable to shareholders of Holcim Ltd declined by 19.6 percent to CHF 1.2 billion.

Solid financing Once more,Holcim ended 2010 with a solid balance sheet and liquidity.The Group’s net debt was further reduced despite the commissioning of new plants and additional capacity. Cash flow from operating activities stabilized at a high level at CHF 3.7 billion.

Capacity expansion for lower costs, higher revenues and improved environmental balance sheet As in previous years,Holcim invested in specific capacity expansion in all segments.The main focus was on the cement segment expansion program initiated in 2007. Expenditures already peaked in 2009,but 2010 still saw CHF 1.2 billion invested in expansion projects in new and existing markets.Other investment activity was once again kept on a low level.

In 2010, the Group commissioned new cement capacity to the amount of 6.8 million tonnes.As part of the expansion program, Holcim Apasco commissioned a new cement plant in Hermosillo,Northwestern Mexico, shortly before the end of the year.With an annual cement capacity of 1.6 million tonnes,the new plant will make it possible to serve the regional construction industry more efficiently and to cut logistics costs.The Nobsa plant in Colombia also expanded its grinding capacity in 2010.In India,Ambuja Cements and ACC commissioned several cement and grinding plants which operate as a network.This means that the two Group companies are well equipped to capture their share of the steady growth in cement consumption.The expansion program also included the Wadi plant,where ACC commissioned an expanded kiln line.With a daily capacity of 12,500 tonnes,it is currently regarded as one of the largest production units worldwide.

Further capacity expansion is underway in Russia, Azerbaijan, Ecuador, India and Indonesia. In Australia, there are also plans for a large quarry which will allow for an optimal supply of aggregates to the Sydney urban area.

Central services focused on market needs Holcim’s corporate services organization sets the tone with innovative, environmentally friendly products and system solutions in an effort to add value to its customers.The Group works closely with various universities and major research and development institutes.The corporate staff units also have many highly qualified experts working in these directions.To strengthen the support provided to the Group companies, the central service functions have been given a stronger focus. Holcim Group Support Ltd optimally leverages the Group’s global know-how and ensures rapid multiplication within the Group.

10 11 Sustainability is a criteria for innovative products In its product development, Holcim is strongly committed to environmentally friendly building materials.This primarily means using new types of mineral components and alternative raw materials which reduce the clinker factor and cut CO2 emissions. Holcim has successfully developed specific offerings for the many booming rural home markets in the emerging economies.The Group also offers new and innovative logistics concepts that help construction companies build demanding, complex and high-quality concrete structures within agreed deadlines.Training concepts form part of this service.

Biodiversity as part of sustainable development The Group’s strategy includes promoting sustainable development. Environmental responsibility also includes preserving biodiversity.To mark the UN’s International Year of Biodiversity, this Annual Report pays special attention to this topic. Protecting biodiversity is of special significance at around 600 locations where the Group ex- tracts limestone,clay and marl for cement production and crushed stone,gravel and sand for use as aggregates. Already in 2007, Holcim signed an agreement with the International Union for Conservation of Nature (IUCN) with the aim of strengthening biodiversity.This partnership gave rise to an effective strategy and a corresponding management system for the protection of biodiversity.The partnership has since been extended by three years.

Throughout the Group, efforts continue to be centered on strengthening a culture of safety.While visible progress has been made,lives were still lost,which is a matter of great regret to us.However, the Board of Direc- tors and the Executive Committee are convinced that the measures taken will pave the way for the necessary progress.

Management development and rejuvenation of senior management Talent promotion and succession planning are implemented throughout the Group based on uniform rules.With vocational training at the workplace, dedicated training modules, and the cooperation with leading universities, we are permanently preparing our 80,000 employees for a rapidly changing environment.

At Group level, Board and Executive Committee concentrated their efforts on rejuvenating senior management. Newly elected Executive Committee members included Group CFO-elect Thomas Aebischer, Andreas Leu as the executive responsible for Latin America and Roland Köhler as CEO of Holcim Group Support Ltd.With this,it was possible to rejuvenate the Executive Committee by six new members within the last two years.

A word of thanks to our customers,partners and staff Holcim’s positive performance was possible only thanks to our customers across the globe – old and new alike – which place their trust in our products and services. Holcim will do its utmost to continue providing them with innovative solutions swiftly and efficiently.We also owe a debt of gratitude to all our partners who continued to provide us with effective support in many areas in 2010 and especially to all our employees whose committed efforts and skills continued to provide the foundations for Holcim’s success last year. Shareholders’ Letter

Proposal for a payout corresponding to last year’s amount The Board of Directors will be proposing to the annual general meeting on May 5,2011 a payout from the capital contribution reserves corresponding to last year’s amount of CHF 1.50 per registered share.This means that the payout ratio is above the target ratio of one-third of Group net income and reflects the confidence of the Board of Directors and the Executive Committee in the future development of business.

Outlook for 2011 The development of the business cycle still remains uncertain in some areas of the world economy.From a global perspective,it can be expected that the construction sector in the mature markets will recover and that the growth in the emerging markets will continue. Holcim therefore anticipates an increase in sales across all segments. The Group will do its utmost to counter the rise in production and distribution costs by vigorously pursuing price increases.

In Asia,growth can be expected to continue with additional construction activity in Oceania in the second half of the year.Volumes are expected to increase slightly in Europe and North America,and Latin America should also see growth in demand for building materials.The development will be more subdued in Group region Africa Middle East.

The Board of Directors and the Executive Committee are confident that the Group will be successful in securing its share of future growth in the emerging markets and that its lean cost structures will enable it to benefit above average from a continuing economic recovery in Europe and North America.

Rolf Soiron Markus Akermann Chairman of the Chief Executive Officer Board of Directors

March 2, 2011

12 13 The new IUCN Conservation Centre.

Interview with Julia Marton-Lefèvre Director General IUCN (International Union for Conservation of Nature) Interview Julia Marton-Lefèvre

The Holcim Think Tank sits atop the IUCN Conservation Julia Marton-Lefèvre, Director General IUCN Centre, with views over Lake Geneva and the Alps.

Holcim and IUCN:“We share a vision” The International Union for Conservation of Nature (IUCN), headquartered in Gland, Switzerland, and Holcim have been partners for four years.The common activities aim to define environmental protection standards for the Holcim Group, thus contributing to the sustainability of the cement industry and related industries.The partnership agreement was recently extended for another three years. IUCN’s Director General, Julia Marton-Lefèvre, comments on the cooperation with Holcim.

IUCN is engaging with the private sector.Why? Conserving biodiversity is one of the world’s biggest challenges.The private sector plays such a prominent role in our society,so business must be an integral part of the solution. Companies depend on nature as much as people do and they often impact biodiversity directly through their operations, but they can also be important drivers of change.As long as a company has a genuine wish to change the way it does business in order to benefit nature,we would work with it.

What is so“special”in working with Holcim compared to other partners? I believe that Holcim and IUCN have had a truly meaningful engagement over the years, starting with the commitment at the very top, from CEO Markus Akermann,with whom I signed the agreement four years ago,and right through to local Holcim employees with whom we work around the world.Holcim has been very transparent and flexible, which has made for a highly constructive working relationship.This openness has also meant that we have been able to take advantage of new opportunities, such as Holcim’s participation in the major global study on The Economics of Ecosystems and Biodiversity (TEEB).

14 15 Interview Julia Marton-Lefèvre

Holcim provided among other things CO2-reduced cement, This is the headquarters of IUCN and other important international financial support and technical expertise. conservation organizations.

What has IUCN learned from this first phase Many are sceptical about partnering with business. of the relationship? How do you protect your independence and integrity Our cooperation with Holcim has been very fruitful. in such a partnership? Moreover, the relationship has become a model for IUCN is a democratic union of more than 1,100 mem- how we work with businesses in other sectors.Our ber organizations and almost 11,000 experts, reaching work with Holcim has involved many different parts deep into the conservation movement around the of IUCN, through our regional and country offices in world. Some members of this large community are Asia,Europe and North and South America,as well still sceptical about partnering with business and we as our scientific expert volunteers from around the place great emphasis on maintaining our integrity world.The knowledge gained from our relationship, and independence, as well as constantly striving to for example,on how quarry sites impact nature be transparent and results-focused in all our business around them,is also being used in other aspects of engagements. Aside from a wide range of operational IUCN’s work. policies and safeguards, the most important element is to make sure that any company we work with is What do you hope the second phase agreement truly committed to sustainability. will bring? We are very much looking forward to the new three- What does the partnership with Holcim mean year collaboration with Holcim.The main aim will be to you personally? to further incorporate biodiversity management prac- Holcim and IUCN share the vision of a just world that tices into Holcim’s global operations. In addition, the values and conserves nature.The partnership was very work will include some new topics.Water issues, in beneficial for both sides.It has been a pleasure to particular,will be a key focus with the development of work with Holcim and to get to know the company’s a water management strategy addressing how Holcim strong commitment to biodiversity. Holcim and its operations impact local watersheds.We will also in- Foundation for Sustainable Construction provided crease engagement with the wider building materials generous support to the recently opened IUCN Con- sector. servation Centre in Switzerland, helping to realize our dream of building the greenest global headquarters for IUCN.

Julia Marton-Lefèvre, Director General IUCN Biological Diversity

Visits and workshops are regularly organized in the quarries Beautiful Peacock Butterfly. for school classes.

Biological diversity – a resource Holcim treats with care

The UN General Assembly declared 2010 as the“International Year of Biodiversity”.The UN’s move serves as a reminder to us all that the variety of species and habitats around the world is diminishing fast – and that this has implications for the whole of humanity. Holcim has for many years demonstrated its global commitment to biodiversity and a responsible approach to the use of natural resources.

Biodiversity is about more than just the variety of cement and aggregates.As one of the world’s leading species:It is also inextricably linked to the diversity of suppliers of building materials,Holcim is aware of this ecosystems,as well as genetic diversity within a species. and acts accordingly. Because the protection of bio- In its entirety,this natural wealth is part of the basis diversity around the globe is an important part of sus- for life.But its rich variety is under threat.Over 52,000 tainable development, Holcim seeks opportunities to species of animals and plants have been assessed on the minimize the need for natural resources and the impact IUCN Red List ofThreatened Species™.18,000 of them of production on the environment. are facing extinction,including one in five mammals and one in eight species of birds.In recent years,there Partnership with the IUCN has been a major effort to stem the decline in biodiver- As protecting biodiversity is a comprehensive, constantly sity – but more work needs to be done. evolving challenge, the firm cooperates closely with the International Union for Conservation of Nature (IUCN). Holcim is aware of its responsibility In 2007, the two partners signed a collaboration agree- One of the main threats to biodiversity is the world’s ment. An important milestone has since been achieved, increasing consumption of natural resources.This is with a group of experts having proposed to Holcim the resulting in a situation where valuable land is being Biodiversity Management System (BMS): Recommenda- lost,ecosystems are being broken up,and the quality of tions on how biodiversity can be embedded in Holcim’s habitats is declining.The building materials industry management of quarries,as well as on the need to too is dependent on large quantities of raw materials organize and adapt our management system in order and energy. Existing ecosystems are affected by quarry- to help safeguard biodiversity.Holcim is now in the ing for the natural resources used to manufacture process of implementing these recommendations.

16 17 Biological Diversity

The biodiversity exhibition is Courses on nature photography are regularly held. The rehabilitation of the quarry starts already during dedicated to the public. the exploitation.

A number of Group companies have also worked to- Plan of action for quarry sites in sensitive areas gether with IUCN at a local level – including Sri Lanka, The IUCN is an ideal partner for Holcim because it has Vietnam, Costa Rica, Nicaragua, Spain and China. been dedicated to promoting biodiversity around the globe ever since being founded in 1948.The global um- The partnership is intended to further the exchange brella organization now has more than 1,100 member of experience. Holcim and IUCN have therefore placed organizations and brings together 11,000 experts who, the recommendations in the public domain,in the through committees, exchange views on the biggest hope of stimulating discussion and encouraging other problems facing the world:climate change, sustainable companies in the industry to act. energy supply,economic success and the creation of an environmentally sustainable economy.The members Rehabilitated quarries – a benefit to society and nature of the IUCN engage in scientific dialog,work on hun- Holcim’s rehabilitation projects are excellent examples dreds of conservation programs and exert influence of a positive contribution to the environment and the on the formulation of international conventions and diversity of species.Throughout the world,quarries are national laws.IUCN also shows its commitment to carefully rehabilitated and transformed into valuable sustainability at a very practical level:In 2010, the or- oases for flora and fauna.The concept of “near-natural” ganization renovated and expanded its headquarters, landscaping is a core theme running through the which is now known as the Conservation Centre,in quarrying process. Rehabilitation actually begins while Gland,Switzerland – the extension is seen today as one quarrying is still underway.This benefits not only nature of the world’s most sustainable buildings. Thanks to and, by extension, society but also the company – construction methods and building technology that because good ecological planning can result in lower help save raw materials and energy,it meets the long-term costs. Holcim’s cement plant in Belgium is strictest standards of environmentally responsible con- a good example of this“win-win”situation. At Mons, struction: LEED Platinum, Minergie-P and Minergie-Eco. close to the border with France,restoration of two With this new building,IUCN provides an impressive closed quarries started in 1993;in 2009 – thanks to close example of sustainable, cost-effective construction. cooperation with the environmental protection organization“Les Naturalistes du Hainaut”, the University Holcim is proud to have contributed innovative building of Mons and EU funding – the“House of Biodiversity” materials and to have participated in the funding of was opened.The house is a multimedia educational this pioneering building. The company is also delighted establishment and information center.Tours for school that the strategic partnership with IUCN has now been groups and courses on nature photography, for exam- extended for a further three years. Cooperation should ple, are held there and in nearby quarries.The public ensure that by 2013 Holcim achieves its stated target of has been involved in developing this project right from having a plan to protect biodiversity at 80 percent of its the outset,and remains so to this day.Holcim is proud quarry sites situated in sensitive areas. to contribute through these activities to the education and awareness-raising of a wider audience on the topic of biodiversity. Value-Driven Corporate Management

Key success factors

Thanks to the global nature of its operations and its strong presence in growth markets, Holcim is ideally positioned.

Proven strategy inspires confidence Net sales mature versus emerging markets

The Group’s strategy is based on three pillars:concen- 100% trating on the core business, geographical diversifica- 90% 45.7% 48.3% 50.8% 52.4% 50.8% tion, and balancing local business responsibility and 80% global leadership.These principles are proving effec- 70% tive even in a challenging economic environment. 60%

However,in situations such as this,it is also essential 50% to rapidly cut costs,secure liquidity and maintain a 40% strong balance sheet. Holcim has been very successful 30% in these areas since the beginning of the financial crisis. 20%

10%

Global presence as model for success 0% 54.3% 51.7% 49.2% 47.6% 49.2% Holcim is a globally active company.The Group oper- 2006 2007 2008 2009 2010 ates in around 70 countries on all continents,employs Emerging markets a workforce of 80,310 and has production facilities Mature markets at some 2,500 locations.This broad-based presence, with cement plants, aggregates operations (quarries, In 2010, Group companies in emerging markets in gravel and sand pits), ready-mix concrete and concrete Eastern and Southeastern Europe, Latin America, elements plants, asphalt facilities and preparation Africa, the Middle East and Asia accounted for 50.8 platforms for alternative fuels and raw materials, makes percent of Group net sales. a major contribution toward stabilizing earnings by evening out cyclical fluctuations in individual markets Cement and aggregates as the core business more effectively. Our sound revenue streams from Asia, Holcim is one of the world’s leading building materi- Africa and Latin America confirm this and are bringing als groups.Our success over decades is founded on a the desired Group internal compensatory effect. focused and comprehensible product strategy. At its heart are the production and distribution of cement and aggregates (crushed stone, gravel and sand) – key Net sales per region 2010 2009 basic materials for the construction industry. Our in- Million CHF vestment activities and value creation focus mainly Europe 6,535 29.3% 7,320 33.6% on processing natural resources while at the same NorthAmerica 3,240 14.6% 3,480 16.0% time maximizing the use of recyclable materials. LatinAmerica 3,442 15.5% 3,348 15.4% However, this is by its nature highly capital-intensive AfricaMiddleEast 1,098 4.9% 1,206 5.5% and ties up assets over the long term. Asia Pacific 7,958 35.7% 6,418 29.5%

18 19 Value-Driven Corporate Management Base ocmsple ed-i ocee oceeele- concrete concrete, ready-mix supplies Holcim raigaddvlei ocmsprmutojcie nojcieta sbsdo h he taei ilr n eemnsguidelines determines and pillars strategic three the on based is that objective an objective, paramount Holcim’s is value added Creating ntefntoa etr.Tems motn onaino hc vrtigrssi okoc htgvsisbs nadiybasis. daily a on best its gives that workforce a is rests everything which on foundation important most The sectors. functional the in oiini nentoa rdn ncmn,clinker, cement, in trading international in position et n oceepout swl sapatin asphalt as well as products concrete and ments eedn nlclconditions. local on dependent iea opnnsadfes thlsGopcompa- Group helps It fuels. and components mineral hl 00swltl fayrcvr ndmn nmany in demand in recovery any if little saw 2010 While auemresadi ra etr nalconti- all on centers urban in and markets mature auemres osmto fbidn materials building of consumption markets, mature isbyadsl uhpout usd hi market their outside products such sell and buy nies et.Teepout nov ihpooto of proportion high a involve products These nents. oprt epniiiyti nal,priual since particularly entails, this responsibility corporate plants cement operating materials, raw Extracting areas. evcs rdc-pcfcavc n noaiesales innovative and advice product-specific services: epcieevrnet n naaeeso the of awareness an and environments respective Mindsets Goal creation value of pillars Central h ylclconstr cyclical the the in presence strong a for call market regional ocps n ytmsltosseiial o major for specifically solutions system and concepts, n itiuigbidn aeil oalclor local a to materials building distributing and rjcs optn em a fe customers offer can teams Competent projects. evcstioe otercntuto projects. construction their to tailored services ardbsdHli Tr Holcim Madrid-based Strategy cinmtrasbsns shighly is business materials uction dn a edn market leading a has ading tteana ru-ieMngmn etn in Meeting Management Group-wide areas annual core the five At on focused management local Strong ocmepcsti otasaeit aktgrowth market into translate to this expects Holcim 00 h mhsswso iecnrlchallenges: central five on was emphasis the 2010, cosalsegments. all across prtn excellence: Operating o ahae fbsns.Teripeetto is implementation Their business. of area each for ou ncsoe benefit: customer on Focus etrdo raigvlefrtecsoe.Teaim The customer. the for value creating on centered h epniiiyo h niiulGopcompanies, Group individual the of responsibility the customer-specific but products, just not offer to is a gi ihri sa nftr,to h continuing the too, future, In Asia. in higher again was ouin,priual ntehg-rwhscosof sectors high-growth the in particularly solutions, rwho h ol’ ouainadadvancing and population world’s the of growth hc eev agtdspotfo h corporate the from support targeted receive which tf nt Hli ru upr t)adfrom and Ltd) Support Group (Holcim units staff raiainwl edt iigdmn,ntleast not demand, rising to lead will urbanization infrastruct einlsriecenters. service regional eas aycutis atclryi h emerging the in particularly countries, many because akt,silhv ao uniaieadqualitative and quantitative major have still markets, eiisi hi infrastructure their in deficits performance environmental Sustainable rdc focus Product r n housebuilding. and ure ment manage- etrcost Better diversification Geographic raino value of Creation prtn agt r defined are targets Operating innovation marketing Permanent People l ciiiso ocmare Holcim of activities All n osn sectors. housing and excellence resources Human lblstandards Global oa management Local ocmLtd Holcim © responsibility social Corporate Key Success Factors

Solid anchorage of the Holcim culture: Given the ex- effectively. Moreover, closer coordination of the service ceptionally high increase in headcount seen in recent and support functions will also lead to other efficiency years due to acquisitions,it is imperative to ensure improvements. that our corporate cultural values are practiced throughout the Group.The motto“Strength.Perfor- Improved efficiency along the value chain mance.Passion.” needs to be the guiding principle in Holcim anticipated the economic slowdown at an all Group companies. early stage and responded to the financial crisis rapidly and systematically with a raft of cost-saving Permanent staff development: Holcim aspires to be measures.These included the mothballing or final an employer of choice.This is essential if talents are to closure of plants in the US and Europe.In 2009,fixed be attracted and retained.There can be no outstand- costs were reduced by an impressive CHF 857 million ing operating performance without good employees on a like-for-like basis. Despite the commissioning of and qualified managers.This is also the only way to new capacity, the 2010 financial year saw a further achieve high internal standards of occupational reduction (on a like-for-like basis) in the level of fixed health and safety (OH&S).To this end,staff at all levels costs by CHF 312 million.As a result,fixed costs were undergo continuous internal and external training. reduced by CHF 1.2 billion within two years.In the coming upturn, this baseline effect will be of particu- Ongoing sustainable development: Holcim’s long lar benefit to Holcim. planning horizons and dependence on natural resources make sustainable management a strategic Slightly higher headcount owing to growth markets necessity.The Group has therefore long been making Falling demand in many mature markets forced a efforts in this direction.This has also earned Holcim number of Group companies to reduce headcounts. external recognition, such as from the Dow Jones Where redundancies were unavoidable, they were im- Sustainability Index. In future, too, there will be a con- plemented in such a way as to minimize their social tinuing need to systematically guide and motivate impact. However, growth regions bucked the trend in staff at all levels. this respect,partly as a result of the commissioning of new production units or moves to increase customer New structure of corporate staff units proximity by expanding the distribution network and In May 2010, Holcim began coordinating its central establishing ready-mix concrete positions. service and support functions more closely.The relevant areas of responsibility were merged under Whereas at the end of the last financial year the a newly appointed Executive Committee member. Group had 81,498 employees,by the end of the year Holcim Group Support Ltd’s objective is to optimally under review the headcount was 80,310. As expected, process the available global pool of knowledge and staff numbers declined significantly in the crisis-hit Group-wide practices and make it accessible to the Group regions Europe and North America.The Group’s Group companies;new trends in the building materials headcount increased in Group region Asia Pacific, industry and changes in customer needs are to be where the economy was strong. identified at an early stage;advantages of scale in procurement and production are to be exploited more

20 21 Value-Driven Corporate Management t eetgidn aaiya h os ln by plant Nobsa the at capacity grinding cement its rmalne empito iw h ru sprimarily is Group the view, of point term longer a markets From growth in –1.9 program expansion Strategic 2,256 Group Total 2,213 Corporate Pacific Asia East Middle Africa America Latin America North Europe region Group by personnel in Change . ilo onst . ilo onsi iewith line in tonnes million 2.1 to tonnes million 0.7 iigt sals n rwcmn aaiyi the in capacity cement grow and establish to aiming ntegot akto ni,ACadAmbuja and ACC India, of market growth the In mrigmres hr oe7 ecn fproduc- of percent 74 some where markets, emerging lnigfrmdu-emrqieet,adHolcim and requirements, medium-term for planning incpct scretylctd oe oexpand to Moves located. currently is capacity tion eet nrae aaiyb . ilo onsof tonnes million 3.4 by capacity increased Cements cao ilices t rnigcpct y18mil- 1.8 by capacity grinding its increase will Ecuador intne ntefrtqatro 02 e inline kiln new A 2012. of quarter first the in tonnes lion xsigadbidnwpat utatcpt trends anticipate must plants new build and existing eet nLtnAeia h ou a nHermosillo on was focus the America, Latin In cement. ihacpct f21mlintne st ecommis- be to is tonnes million 2.1 of capacity a with ncmn osmto repcieo short-term of irrespective consumption cement in nMxc,weeHli psooee ln with plant a opened Apasco Holcim where Mexico, in nana aaiyo . ilo onso cement of tonnes million 1.6 of capacity annual an fluctuations. inda h R the at sioned n21,Hli nrae t eetcpct Group- capacity cement its increased Holcim 2010, In hrl eoeteedo h er hswl enable will This year. the of end the before shortly ln upistekyMso einmre with market region Moscow key the supplies plant ieb 8 by wide ihgaepout.Finally products. high-grade ocmt teghnisntowd rsneand presence nationwide its strengthen to Holcim upytenrhetr aktaesmr cost- more areas market northwestern the supply fetvl.I diin Holci addition, In effectively. 6mlintne o215mlintonnes. million 211.5 to tonnes million .6 sinpatSuoo hseco-efficient This Shurovo. plant ussian 8123,5 +3.6 36,858 38,172 2701,2 +0.7 12,626 12,710 9602,0 –5.3 20,800 19,690 0308,9 –1.5 81,498 80,310 ,6 ,1 –16.8 8,016 6,668 0020 ±% 2009 2010 5 4 –9.0 942 857 e inln ihan with line kiln new a , oobaincreased Colombia m nulcpct f17mlintne u ocm on come to due tonnes million 1.7 of capacity annual sa cnm eoe oemtr,vria inte- vertical mature, more becomes economy an concrete As and aggregates in investments Further itiuincne nSde,Asrla hc over which Australia, Sydney, in center distribution rto sue rae motnefrHli.Major Holcim. for importance greater assumes gration ne osrcina h n f2010. of end the at construction under temi 01i ne osrcina h Garadagh the at construction under is 2011 in stream h oigdcdswl nbeHli ospl this supply to Holcim enable will decades coming the nrsrcuepoet n eieta n commer- and residential and projects infrastructure n21,tedcso a ae obidnwcement new build to taken was decision the 2010, In ln nAzerbaijan. in plant h diinlcpct et h aetsadrsin standards latest the meets capacity additional The rwhmre ihtpqaiyageae tlow at aggregates top-quality with market growth ilcntuto ciiyi uhmrescuearise a cause markets such in activity construction cial lnsi noei n rnewt nana capacity annual an with France and Indonesia in plants em fcssadevrnetlefcec.Stsfor Sites efficiency. environmental and costs of terms ndmn o ihgaeageae n ready-mix and aggregates high-grade for demand in ot h atta h e iewl econnected be will site new the that fact The cost. f16ad06mlintne fcmn,respectively. cement, of tonnes million 0.6 and 1.6 of e lnsaenral eetdi oain where locations in selected normally are plants new oteriwyntokas nue re delivery. green ensures also network railway the to ocee eas ftehg ereo regulation, of degree high the of Because concrete. ceue obgnoeain n21,tepatin plant the 2013, in operations begin to Scheduled ru opne led aegaate eevsof reserves guaranteed have already companies Group a aeil n eletbihdmre positions. market established well and materials raw euiggaate eevso a aeil sof is materials raw of reserves guaranteed securing noei ilhl eppc ihcniun market continuing with pace keep help will Indonesia ftettlo 59mlintne fcpct expan- capacity of tonnes million 25.9 of total the Of ao taei importance. strategic major iniiitdi 07 9. 2007, in initiated sion 00swtedcso ooe e qu new a open to decision the saw 2010 rwho h aniln fJv.Oeal 14million 11.4 Overall, Java. of island main the on growth onso eetcpct xaso eeudrcon- under were expansion capacity cement of tonnes tuto tya-n 2010. year-end at struction ilo onswr still were tonnes million 2 rypu a plus arry Key Success Factors

Approved cement capacity expansion within the Group in million tonnes 2011 to 2013 Company 2011 2012 2013 Total Alpha Cement (Russia) 2.1 2.1 Garadagh Cement (Azerbaijan) 1.7 1.7 Holcim France 0.6 0.6 Total Europe 3.8 0.6 4.4

Holcim Ecuador 1.8 1.8 Total Latin America 1.8 1.8

Holcim Morocco 0.01 0.0 Total Africa Middle East 0.0 0.0

ACC (India) 2.1 2.1 Ambuja Cements (India) 1.5 1.5 Holcim Indonesia 1.6 1.6 Total Asia Pacific 3.6 1.6 5.2

Total Group 7.4 1.8 2.2 11.4

1 Clinker capacity will be increased from 0.4 to 0.8 million tonnes.

The company’s strong position in the ready-mix con- gain competitive advantages through differentiated crete market will also be further strengthened. product offerings. Innovative, needs-oriented solutions help ensure that the high quality standards are met. In addition, Holcim is increasingly offering system solutions for new construction projects. Large con- In line with Holcim’s commitment to premium quality, struction groups are opting more and more for effi- sustainable building materials, we are stepping up cient end-to-end solutions with elaborate logistics, the use of composite cements in the production of particularly when dealing with complex projects. concrete. In addition to clinker and gypsum, they also incorporate special components such as granulated Concrete as an indispensable, environmentally friendly slag, fly ash or pozzolans.“Holcim Optimo”, launched building material by Holcim Switzerland in 2010,is a good example.The Concrete is an energy and CO2-efficient building product’s improved performance and versatility are material on a life cycle basis and is used on a huge impressive,but so too are its economic and environ- scale in construction projects worldwide. In terms of mental qualities. Its new formula,based on oil shale volume, it is the world’s second most sought-after from our Dotternhausen plant in Southern Germany, commodity after water. Modern infrastructure would is bringing about significant cuts in CO2 emissions. be inconceivable without concrete.With our expertise, Holcim Switzerland is assuming a pioneering role we help customers increase their productivity and with this product.

22 23 Value-Driven Corporate Management o ahsget oee,tecalnigeconomic challenging the However, segment. each for ocmhsseii prtn BTAmri targets margin EBITDA operating specific has Holcim EBITDA margin operating segment-specific of Definition Af people. 3,000 concrete ready-mix 226 pits, sand and gravel 78 With Australia Holcim of integration Successful increase steady a seen has Group the years, recent In ntepooto foealslso yrui binders hydraulic of sales overall of proportion the in nitgaigtenwcroaeui noteHolcim the into unit corporate new the integrating on iuto nvrosmresadtersligsharp resulting the and markets various in situation ru.Cr a ae oesr htalrelevant all that ensure to taken was Care Group. lnsad1 rdcinfclte o concrete for facilities production 15 and plants ytm n rcse eeitoue ln with along introduced were processes and systems espa n ao rjcswr lofehdotby out fleshed also were projects major and plan ness eln nvlmsma ht ept eutosin reductions despite that, mean volumes in decline cone o yteecmoiecmns(n 2010: (end cements composite these by for accounted ot n nrae nefcec,te ilol be only will they efficiency, in increases and costs continent’s the of one is Australia Holcim elements, h ocmpicpe fcroaemanagement. corporate of principles Holcim the pcait,wt h i fipoigefcec and efficiency improving of aim the with specialists, vr7 percent). 77 over civbeoc osmto ik pagain. up picks consumption once achievable oeta feprsfo h ru n from and Group the from experts of team core A edn upir fbidn aeil.Operating materials. building of suppliers leading utn ot.Argoa Tcne ilb established be will center IT regional A costs. cutting ocmAsrlahae h nerto rcs over process integration the headed Australia Holcim ainie hsGopcmayeposar employs company Group this nationwide, eido eea ots pca rgaswr set were programs Special months. several of period a ospotteGopcmaisHli utai and Australia Holcim companies Group the support to pfrtefnneadH etr swl sfrinfor- for as well as sectors HR and finance the for up ocmNwZaad h nrdcino h Holcim the of introduction The Zealand. New Holcim matio rn oe pca hleg stecmayhas company the as challenge special a posed brand ,0 rcsadoeae tmr hn30locations. 300 than more at operates and trucks 1,500 ehooyadbadn.Tesrtgcbusi- strategic The branding. and technology n targets e h custo,wr ucl started quickly work acquisition, the ter ound tutrswn oewytwr acligotthe out cancelling toward way some went structures mrc n fiaMdl East. Middle Africa and America eaieefcs nblne h prtn EBITDA operating the balance, On effects. negative ru opn ohi bouetrsadi com- in and terms absolute in both company Group a be hsfco rmtdHli ayyasaoto ago years many Holcim prompted factor This measurable. be to needs progress improvements, achieve To performance operating of improvement and measurement Constant esrn h viaiiyo insseso capacity or systems kiln of availability by the example, for measuring companies, Group other all with parison dp ytmtcapoc ntecmn segment cement the in approach systematic a adopt fteeadohrdt.Certresfrprmtr of parameters for targets Clear data. other basis and the these on of compiled is index composite A utilization. htivle eodn hne nth in changes recording involves that h oper The agni h eetsgetws2. percent, 27.1 was segment cement the in margin iia ytmo esrmn n oprsnis comparison and measurement of system similar A hstp epu rmtyietf n addr and identify promptly us help type this ono h rvosya’ iueo 84percent. 28.4 of figure year’s previous the on down aeil n evcssgetdcie o28percent 2.8 to declined segment services and materials 20:37.Tetre ean percent. 8 remains target The 3.7). (2009: nGoprgosLtnAeiaadArc ideEast, Middle Africa and America Latin regions Group In ihrrwmtra n nrycssdpesdthe depressed costs energy and material raw Higher h agntre f3 ecn a exceeded. was percent 33 of target margin the eetmri n21.Hwvr fiinygisand gains efficiency However, 2010. in margin cement h prtn BTAmri o grgtscudbe could aggregates for margin EBITDA operating The h omsinn fnwpat ihfvrbecost favorable with plants new of commissioning the nrae o2. ecn 20:1.) n21,Latin 2010, In 19.7). (2009: percent 21.2 to increased mrc a bv h agto 7pret Margin percent. 27 of target the above was America mrvmnscou improvements aeil n evcs8 .%3.7% 2.8% 8% services and materials prtn BTAmri agt21 2009 construction Other 2010 Aggregates Cement Target margin EBITDA Operating tn BTAmri fteohrconstruction other the of margin EBITDA ating db elzdi uoe North Europe, in realized be ld 7 12 19.7% 21.2% 27% 3 71 28.4% 27.1% 33% efrac of performance e s gaps. ess Key Success Factors

Value chain © Holcim Ltd Supply Demand Sales channels Basic materials Transactional Transformational Endusers Applications in the processing construction sector

Direct sales

Cementitious materials Ready-mix concrete Housing General Traders contractors Cement Concrete products Mineral components Masons Wholesalers Self-builders Commercial/industrial Mortars building Cement and aggregates are the basis Aggregates Retailers – concrete and Asphalt asphalt bring us Sand, gravel, stone, Civil engineering closer to the end recycled aggregates Direct sales contractors Infrastructure consumer. currently under development for aggregates and ready- mix concrete and will gradually be introduced at Group level.This will enable Holcim to ensure that operating Holcim Value Added (HVA)1 performance can be compared objectively and im- HVA before taxes in million CHF ROIC before tax in % proved in all areas of activities throughout the Group. 1,200 24%

1,000 14.3 14.6 10.2 9.1 8.3 22%

Sustainable value creation as paramount objective 800 20%

Holcim’s goal is to be the most attractive company in 600 18% the building materials industry. An important factor 400 16% in determining the Group’s appeal is naturally the 200 14% return on its invested capital, which should exceed its 02 12% pre-tax weighted average cost of capital (WACC) of –200 10%

11.76 percent on a sustainable basis. –400 8%

–600 6%

Measured according to Holcim Value Added (EBIT – –800 4% standard capital costs ϫ invested capital), the Group –1,000 2% has, over many years, created substantial added value –1,200 0% above theWACC of 11.76 percent before taxes. How- –1,400 ever, owing to the current economic situation, the 2006 20073 2008 2009 2010 Group’s return on invested capital (ROIC) declined to 1 Excluding cash and cash equivalents. 8.3 percent in 2010. Nevertheless, with the successful 2 WACC before tax of 11.76 percent. reduction in fixed costs, this year also saw Holcim 3 Excluding the majority sale in South Africa.

24 25 Value-Driven Corporate Management ocmi ncntn ilgwt ierneof range wide a with dialog constant in is Holcim efforts substantial its on based is reputation Holcim’s reputation our responsibility enhance social and commitment Environmental share- the for fruit bear should success Group’s The policy dividend Attractive improving toward contribution significant a make n20,teGopetbihdteHli Foundation Holcim the established Group the 2003, In construction sustainable of Promotion construc- the in companies sustainable most the of o utial osrcin hog hsbd it body this Through Construction. Sustainable for opooessanbedvlpet ocmi there- is Holcim development. sustainable promote to share. registered per 1.50 CHF of amount year’s tkhle rus hsi lorfetdi strategic in reflected also is This groups. stakeholder inmtrassector. materials tion oegie ytebsccneto h til bottom “triple the of concept basic the by guided fore Directors of Board the 2003, In Ltd. Holcim of holders profit. operating its hmin h as fgetrssanblt nthe in sustainability greater of cause the champions ie fceto fvle utial environmental sustainable value, of creation of line” atesiswt uhbde steInternational the as bodies such with partnerships osrcinsco elbyn t oebsns.The business. core its beyond well sector construction no o osraino aue(UN.A the At (IUCN). Nature of Conservation for Union eemndta n-hr fnticm attributable income net of one-third that determined efrac n oilrsosblt,adregards and responsibility, social and performance einn fteya ne eiw ocmjoined Holcim review, under year the of beginning hs sitga opnnso t overridi its of components integral as these distributed. be should Ltd Holcim of shareholders to h CCCroaeSpotGopadcommitted and Group Support Corporate ICRC the o h 00fnnilya,teBadi proposing is Board the year, financial 2010 the For ofitregions. conflict ocmi neaanlse nteDwJnsSustain- Jones Dow the in listed again once is Holcim in projects humanitarian specific supporting to itself oteana eea etn aotfo the from payout a meeting general annual the to blt ne 0021 n ss as and 2010/2011 Index ability aia otiuinre contribution capital evscrepnigt last to corresponding serves c srgre sone as regarded is uch gstrategy. ng mn t tkhles tmksagoa contribution global a makes It stakeholders. its among www.holcimfoundation.org. ulcpoieadaHli ou ouigo sus- a on focusing Forum Holcim a high and very a profile with public competition global a important are most activities Foundation’s The life. of quality a and better architecture outstanding promoting toward iergoa ocmAad opttosfrsustain- for competitions Awards Holcim regional five et rm4 onre nae necagsof exchanges in engaged countries 40 from perts anblt hm.Teeaecnutdeeythree every conducted are These theme. tainability iw ntepeayssin nteeseii work- theme-specific in session, plenary the in views becntuto rjcs h einlaad with awards regional The projects. construction able h hr nentoa ocmFrm nild“R entitled Forum, Holcim international third The years. rzsttln S ilo iltk lc n2011, in place take will million 2 USD totaling prizes n rusado xusos h ou a nsus- on was focus The excursions. on and groups ing ocmFudto ist otrgetrunderstand- greater foster to aims Foundation Holcim anblt susi osrcinpann n the and planning construction in issues tainability netn osrcin,wshl nArl21 tthe at 2010 April in held was Construction”, inventing olwdb h lblaadi 02 ru compa- Group 2012. in award global the by followed osrcinpoes h ou trce great a attracted Forum The process. construction Univer isaeognzn vnst ulcz h anhof launch the publicize to events organizing are nies n fssanblt nteevrnetl social environmental, the on sustainability of ing h nentoa rjc optto nationwide. competition project international the elo neet t eieain n conclusions and deliberations Its interest. of deal n cnmcfro economic and h onainwl upr hi fot iha with efforts their support will Foundation The eedcmne na cdmcpbiainwhich publication academic an in documented were lblcampaign. global a eotie rmteHli Foundation. Holcim the from obtained be can nomto nprnrhp n activities and partnerships on Information ulcrltoswr has work relations Public fteHli Fou Holcim the of ia braeiaai eioCt.20ex- 270 City. Mexico in Iberoamericana sidad t ntecntuto etrand sector construction the in nts dto a efudat found be can ndation eu ntetidcceof cycle third the on begun e- and Management Organization

Organization and management

The Group’s management and line responsibility is structured by regions. A broad Code of Conduct ensures that all employees know what rights and obligations apply to them.

Efficient management and control ship. Moreover, Holcim has introduced a centrally coor- The aim of Holcim’s corporate governance policy, dinated training program, and the Group companies which defines the management processes, the organi- undergo regular checks in this regard,carried out by zation and monitoring of the highest corporate man- independent lawyers. All training and support materials agement levels, as well as business policy principles concerned with fair competition are continually brought and internal and external control mechanisms,is to into line with the latest developments in competition ensure responsible and transparent management and law. During the year under review,a manual entitled control of the company with the focus on sustainable “Value Creation in Practice”was drawn up.This refer- value creation. It is the basis of the Group’s credibility ence work provides useful tips on good commercial and good reputation and strengthens confidence practices which fully comply with European and US among investors, business partners, employees and competition legislation. the public at large.

The principles of corporate governance are continuously adjusted to requirements.The internal control system (ICS) introduced in 2007 and 2008 for the presentation of the annual financial statements, conforming to the requirements of Art.728a of the Swiss Code of Obligations and Swiss Auditing Stan- dard 890, continues to prove itself.

Value creation in a competitive environment Issued by the Board of Directors and the Executive Committee in 2003, the Code of Conduct defines Group-wide standards of business behavior expected of all staff.It can be found on our website under www.holcim.com. Among other things, it requires strict respect of the rules of competition. Non-compliance will result in disciplinary measures, which could go as far as termination of the employment relation-

26 27 Status as at Board of Directors Executive Committee Area Management March 2, 2011 Rolf Soiron Markus Akermann Javier de Benito Chairman, Chairman of the Chief Executive Officer Urs Fankhauser Value-Driven Corporate Management Governance, Nomination & Thomas Aebischer Aidan Lynam Compensation Committee As of January 1, 2011 member of the Bernard Terver Andreas von Planta Executive Committee; effective Deputy Chairman April 1, 2011 Chief Financial Officer Corporate Functional Managers Markus Akermann Urs Böhlen Jacques Bourgon Christine Binswanger Eastern & Southeastern Europe, Stefan Wolfensberger Beat Hess CIS/Caspian region Erich Hunziker Patrick Dolberg Auditors

Photo: Peter Küpfer Belgium, France, Netherlands, Ernst & Young Ltd The Executive Chairman of the Audit Committee Germany, Switzerland, Italy Committee from left to right: Adrian Loader Paul Hugentobler Management Structure Urs Böhlen Thomas Schmidheiny South Asia & ASEAN excl.Philippines See organizational chart Benoît-H. Koch Theophil H. Schlatter Wolfgang Schürer Benoît-H. Koch on page 31 Thomas Aebischer Dieter Spälti North America, UK, Norway, Markus Akermann Robert F. Spoerry Changes Paul Hugentobler Mediterranean incl. Iberian Patrick Dolberg Peninsula, International Trade See also Corporate Governance Roland Köhler Secretary of the Board of Directors Roland Köhler page 87 ff. Ian Thackwray Andreas Leu Peter Doerr CEO Holcim Group Support Ltd Andreas Leu Latin America Theophil H. Schlatter Chief Financial Officer until March 31, 2011 Ian Thackwray East Asia incl. China, Philippines, Oceania and South & East Africa and Management Organization

At the 2010 ordinary general meeting,H. Onno Ruding, Theophil H.Schlatter,who is retiring at the end of March who has been a member of the Board of Directors 2011.Andreas Leu,Area Manager and member of the since 2004,retired from the Board on having reached senior management of Holcim Ltd,joined the Execu- the age limit.The Board of Directors would like to tive Committee on January 1,2011.He has taken over thank him for his valuable service. responsibility for Latin America from Thomas Knöpfel, who retired at the end of 2010. Beat Hess was newly elected to the Board of Directors. An attorney and doctor of law,until the end of 2010,he With effect on January 1, 2011, Urs Fankhauser, Regional was Group Legal Director and member of the Executive Technical Director Eastern Europe, was appointed Committee of Royal Dutch Shell Group,The Hague. Area Manager and member of the senior management of Holcim Ltd.In this function,he is responsible for The Board of Directors appointed Roland Köhler, Corpo- the markets in Eastern and Southeastern Europe. rate Functional Manager and responsible for Corporate He reports directly to Executive Committee member Strategy & Risk Management,member of the Executive Urs Böhlen. Committee effective March 15, 2010. He heads the central service and support functions of Holcim Group Line and functional management responsibility Support Ltd (HGRS) as CEO. The key to the Group’s success lies in the competence of our local management teams.The operating units in At the end of March 2010,Bill Bolsover stepped down around 70 countries fall under the line responsibility of as Area Manager and Corporate Functional Manager individual Executive Committee members, assisted by for age reasons. Bernard Terver,CEO of Holcim US and Area Managers and Corporate Functional Managers. Aggregate Industries US, was appointed Area Manager and member of the senior management of Holcim Ltd, If our Group companies are to strengthen their cost effective April 1,2010. He is responsible at Group level and market leadership in their markets, they need for Holcim US and Aggregate Industries US. Bernard entrepreneurial room for maneuver as well as support Terver reports directly to Executive Committee mem- from the Group in the form of specific know-how and ber Benoît-H. Koch. predefined parameters.

On July 1,2010,Ian Thackwray,member of the Executive We are convinced that success in our business depends Committee since the beginning of 2010, succeeded on striking a balance between local power and auton- Tom Clough following his retirement at the end of omy on the one hand,and the right degree of support June 2010. Ian Thackwray is responsible for the compa- and intervention from Group headquarters on the nies in East Asia,including China, the Philippines and other. A coherent program of basic and continuing Oceania,and South and East Africa. management training, as well as systematic succession planning to develop candidates with executive As part of the succession planning process,Thomas potential at both national company and corporate Aebischer,CFO of Holcim US,was appointed to the levels,are factors which will strengthen the Group on Executive Committee,effective January 1,2011. On April 1, a lasting basis. 2011,he will assume responsibility as Group CFO from

28 29 Value-Driven Corporate Management u loopruiis h or fDrcosreceives Directors of Board The opportunities. also but h taei,operat strategic, the nal dniyn het ln h nievlechain, value entire the along threats only not identifying This entails bottom-up. and top-down both assessed nteassmn rcs.TeGopsrs rfl is profile risk Group’s The process. assessment the in ag fdfeetitra n xenlrs ye in types risk external and internal different of range 00 h eta evc n upr ucin of functions support and service central the 2010, iteadteBado ietr r loinvolved also are Directors of Board the and mittee prpit ee.Rs aaeetlosa wide a at looks management Risk the level. at appropriate implemented and proposed then are measures eaial eprcgiemjrrss–a ela op- as well as – risks major recognize help tematically Group the of teams management the and Committee GSwr egdudroemanagement. one under merged were HGRS May in efficiently, more energies pool To level. global n opportunities and nadto oteGopcmais h xctv Com- Executive the companies, Group the to addition In dniidadeautda nerysae Counter- stage. early an at evaluated and identified opne.Bsns ikMngmn ist sys- to aims Management Risk Business companies. Executive the supports Management Risk Business risks identifies Management Risk Business divi- its and flat are structures hierarchical Holcim’s lc.Gopcmaisaegvncergieie in guidelines clear given are companies in Group systems place. management structured well has Holcim otnte aigtecmay oeta ik are risks Potential company. the facing – portunities in frsosblt lal eie oha Group at both – defined clearly responsibility of sions e ra ftebsns,fo ehooyadenvi- and technology from business, the of areas key omnal redypouto ohmnresources human to production friendly ronmentally ee n nteidvda ru opne.This companies. Group individual the in and level n finance. and nue htdcsosaebsdo xetknowledge expert on based are decisions that ensures n otaaees n htnwpoesso stan- or processes new that and awareness, cost and ad a eipeetdwtotdelay. without implemented be can dards h ru’ aaes h ein n h countries the and regions the managers, Group’s The n oa ie r sitdb evc etr tthe at centers service by assisted are sites local and einllvladb cen by and level regional n n iaca sectors. financial and ing rlcroaesafuisa a at units staff corporate tral eua eot nipratrs nlssfindings analysis risk important on reports regular n rvdsudtso h esrstkn(e also (see taken measures the on updates provides and ae93). page ihitra n xenldrcie uha plans, as such directives external and internal with information; operational and financial of nenlAdti nidpnetbd.I reports It body. independent an is Audit instrument Internal monitoring important an as Audit Internal aibecmesto spi ntefr fHolcim of form the in paid is compensation variable oaheetecroaegasadaddvlei is it value added and goals corporate the achieve To objectives joint on Focus secure. are assets operating whether Examining compliance controlling for systems the Examining completeness and reliability the Examining ietyt h himno h or fDirectors of Board the of Chairman the to directly ac,adoeae ytm omtvt management motivate to systems operates and performance, measures systematically Holcim for, aiming ordinances; and laws processes, hrs hc r okdi o eido he ofive to three of period a for in locked are which shares, n umt eua eot oteAdtCommittee. Audit the to reports regular submits and er.Ti ytmsrntestesae ou na on focus shared the strengthens system This years. atr,btas oioscmlac ihexternal with compliance monitors financial also to but itself matters, confine not does Audit Internal eireeuie.Slre r acltdntol on only not calculated are most Salaries our for executives. place senior in is system standardized, A compensation level. variable high consistently a on perform to fiinyo nenlmngmn n oto systems, including: control and management and internal of effectiveness the efficiency to paid is attention Particular guidelines. internal and h ai ffnnilojcie,btas nlgtof light in also but objectives, financial of basis the utial nraei h ru’ efrac and performance value. Group’s the in increase sustainable niiulgas(e lormnrto eoton report remuneration also (see goals individual ae 0 o16.As A 116). to 106 pages giiatpooto fthe of proportion ignificant and Management Organization

Organizational chart

Board of Directors Holcim Ltd

Audit Committee Governance, Nomination & Compensation Committee

Markus Akermann Internal Audit1 CEO

Executive Committee

Benoît-H. Patrick Urs Andreas Paul Ian Theophil H. Roland Koch Dolberg Böhlen Leu Hugentobler Thackwray Schlatter Köhler CFO CEOHGRS

Thomas Aebischer

Line Responsibility

North America Belgium Eastern & Latin America South Asia East Asia4 Finance & Holcim Group UK France Southeastern ASEAN 3 Oceania Controlling Support Ltd Norway Netherlands Europe South & (HGRS) Mediterranean2 Germany CIS/ East Africa International Switzerland Caspian Region Trade Italy

Area Managers/Corporate Functional Managers

Javier Urs Aidan Jacques de Benito Fankhauser Lynam Bourgon

Bernard Stefan Terver Wolfensberger

Functional Responsibility

Strategy & Risk Financial Commercial Management Holding & Tax Services Legal & Controlling ACM Services Compliance Financing & Sustainable Communi- Treasury Development cations Cement Investor Manufacturing Relations Services Procurement Human Resources 1 Internal Audit reports to the Chairman Information & of the Board of Directors. Knowledge 2 Including Iberian Peninsula. Management 3 Excluding Philippines. Accounting & 4 Including Philippines. Administration

Status as at March 2, 2011.

30 31 Value-Driven Corporate Management Innovation ucsflydvlpdseiial o ao projects. major for specifically developed are successfully services Comprehensive solutions. system sustainable and ocmi nacn eeist utmr hog innovative through customers to benefits enhancing is Holcim in s faalbeeeg a aea effective an make can energy effi- available more of use medium-term, cient and emis- short CO2 the reduce Over to sions. as order sources in energy solutions renewable long-term on the is on focus high The are agenda. footprint resources environmental other and smaller a fuels of use efficiency, efficient energy more greater New to principle. leading underlying technologies an as sustain- safety and with are management ability, cost technology improving process at of aimed field the in efforts R&D development product technology and process in solutions Sustainable partners. jointly held research its some with including – forward- on technologies patents looking holds Holcim markets. our in con multi- and rapid ideas of the also plication but development, broad-based and only research not are customers. for ingredients value Essential added com- our create and strengthen which petitiveness services and and products processes, on on production both friendly is here environmentally focus The to development. contribution sustainable important an materials, makes also construction of Holcim manufacturer leading a As o nry ocmi sn noaieadeco- and innovative using is Holcim energy. competition for growing addressing toward contribution vnfo o-eprtr at etfo the from heat waste electricity low-temperature from generate even to techniques viable nomically rdcinproc production ess. et nteGopand Group the in cepts and , rdciiyi h auatrn rcs n lower and process costs. manufacturing increased the to in leads it productivity as offers also opportunities products Group and the processes our of “environmental the footprint” Reducing customers. awareness our among environmental increasing resource and prices, energy shortages rising posed change, challenges climate the by addressing is Holcim products, problem-solvi innovative With emissions. CO2 cut help so doing clinker in the and and reduce factor which binders mineral materials of raw types alternative new of to use seeks the It increase materials. building environ- friendly on focuses mentally primarily development Product nbe h nevzpatt prt oeeffi- more operate to plant heat waste Untervaz the Re-using enables electricity. exhaust clean turn into to heat used gas be can which Cycle), Rankine state-of- The Switzerland. the at Untervaz, in electricity plant generate cement to deploy system to ABB agreed new have a Switzerland Holcim and ABB close. very be often can firms consultancy manufacturers and plant Cooperation universities, companies. renowned Group both with by placed and are Group sector the this by in partners Contracts motivated experts. and and ven- qualified cooperative highly new with up tures setting constantly is Holcim sustainability of standards terms new in set partnerships and Innovations h-r ouini ae on based is solution the-art ytmt eeaeeetiiya h cement the at electricity generate to system ln nUntervaz. in plant ocmSizradwl elyanwABB new a deploy will Switzerland Holcim R ehooy(Organic technology ORC gfrpoessand processes for ng Innovation

ORC technology (Organic Rankine Cycle) can be Ambuja Cements has developed a tailor-made solution package with used to turn exhaust gas heat into electricity. products and services for rural housebuilding.

ciently, reducing its dependence on grid power.The Products and services for the construction result is a substantial reduction in energy costs. of rural dwellings Holcim is constantly working on developing new Holcim cooperates successfully with leading research groups of customers, one good example being institutions and is a founding member of the Nanocem Ambuja Cements in India. By closely engaging in the consortium. Nanocem, which conducts fundamental housebuilding needs of the rural population, the research into nanotechnology for cement and con- Indian Group company grew familiar with issues crete, is an alliance of leading European universities such as inadequate planning, poor quality construc- and major companies in the building materials tion, cost overruns and a lack of financing options. sector.We maintain close relationships with the Swiss Federal Institutes of Technology in Zurich and To address these problems, Ambuja Cements has Lausanne (Switzerland), Clausthal University of developed tailor-made solution packages. The Technology (Germany) and many other institutions. cement distributors, who serve as the point of contact for potential home-builders, work closely Holcim is actively involved in initiatives, European with Ambuja Cements. The distributor coordinates and international, with the visionary goal of helping the entire construction project and organizes the shape priorities for future global research and necessary support from the planning phase through development into sustainable and energy-efficient the building contract, including the delivery of the manufacturing processes. In the context of its building materials. The precast concrete elements involvement in the European Cement Research needed to build a sturdy home are also supplied, Academy, the company is looking into CO2 capture guaranteeing rapid progress on the construction with a view to integrated and end-of-pipe solutions. project. Ambuja Cements provides specialist support, The aim is to continue to develop sustainable and along with training and quality control for the economically viable technologies of this type which cement distributors. The company is therefore more can be used worldwide. than just a supplier of cement: as a solution provider, it is constantly winning the confidence of new Knowledge management thanks to iShare customers and in doing so is helping improve the Improving dissemination and leveraging maximum quality of life in rural areas. use of in-house knowledge is of strategic importance. The electronic platform iShare was launched with this aim in mind.This open platform enables staff to exchange information. Important documents are also stored there for easy access Group-wide, and virtual networks are in place for undocumented knowledge.The Group’s global pool of expertise is thus fully accessible to the individual companies.

32 33 Value-Driven Corporate Management facsoie solution customized a of eonditrainlcnrco.Hli Vietnam a Holcim Bouygues, contractor. by built international being renowned is Chi It Ho in (Vietnam). City construction Minh under currently is offices apartments, space, retail sky- accommodating scraper 200-meter-high a Tower”, concept M&C logistics “Saigon The ingenious and quality product High for units the terracing won the also for has contract UK inter- Industries without Aggregate materials ruption. supply concrete to it ready-mix enabling on-site center, own its operating is UK sourced be will aggregates the of proportion large A elements. numerous and concrete precast asphalt ready- of with along meters cubic concrete, mix million 0.9 and aggregates of the won UK Industries con- Aggregate well its proposal, for to ceived targets Thanks accordingly. bidding the suppliers set the and key, build- as friendly materials ing environmentally sustain- and identified construction Park able Olympic responsible 2012 body London the planning for the outset, very its From example an as Olympics 2012 London The proposal. conceived London: in 2012 Games Olympic grgt nutisU won UK Industries Aggregate rmpeatcnrt lmns ospotthe support To elements. constructed concrete be precast will from which 6,000, for seating with ern tutrs hswl nbeasignificant a enable load- will all This for used structures. be bearing will which strength offering exceptional “super-concrete” special company a The developed basis. has exclusive meters an cubic on 155,000 concrete with of project the supplying is Industries Aggregate materials. building recycled from the supply will years of construc period a over and contract h otattak oiswell its to thanks contract the ietyi h utmrsofc oesr htthe that smoothly. ensure to goes office project customer’s the working in member directly team one dedicated with a team up set project has UK sites, Industries construction large Aggregate various the on customer inpoetwt rud15mlintonnes million 1.5 around with project tion & oe”i currently is Tower” M&C ne construction. under “Saigon 200-meter-high nH h ihCt,the City, Minh Chi Ho In h Velodrome, the and riigcnet r motn atr,wihcover which factors, important are and concepts assurance training Quality will delivery. which “just-in-time” logistics ensure also first-class is with customer provided The being impact. reduc- and environmental the the costs up ing cutting speed thus to process, possible it construction make will properties ting lxblt ftecooperation. and the of openness the sophis- flexibility and its safety, concept site logistics and ticated quality product of standards terms high in its expertise, Holcim technical Vietnam’s appreciates particularly customer The deliveries. the concrete of all overview of quality continual a developer the giving n oceepouto hog oteedproduct end the to through materials production raw of concrete and procurement the from stages all h eeibs unl opiigtotbso 54kilometers 15.4 of tubes two comprising length. in tunnel, base Ceneri The inst o h aetne hog ot Ceneri Monte through tunnel base the for site tion cement, supplying began recently Switzerland Holcim tunnel base Ceneri construction of for choice first is Holcim euto ntetpclylrenme fplasand pillars of number large a typically the in reduction rt.Srie ilas epoie,icuigatech- a including provided, be also will Services crete. ntecno fTcn.Ti unl opiigtwo comprising tunnel, This Ticino. of canton the in concrete ready-mix and aggregates ia aoaoyadalo-ielgsis pt 800 to Up logistics. on-site all and laboratory nical ue f1. ioeesi egh spr fteNEAT the of part is length, in kilometers 15.4 of tubes ui eeso ed-i oceewl eproduced be will concrete ready-mix of meters cubic rnapn xswihwl xadri ik through links rail expand will which axis Transalpine e a nafclt . ioeesit h mountain. the into kilometers 2.7 facility a in day per h ws ls ewe 00ad21,Holcim 2018, and 2010 Between Alps. Swiss the eetadageae ilb eiee yri.This rail. by delivered be will aggregates and Cement wteln st upy04mlintne fcement of tonnes million 0.4 supply to is Switzerland xesv ag fsrie a eofrdtak to thanks offered be can services of range extensive o h eeitne,aogwt ilo onsof tonnes million 2 with along tunnel, Ceneri the for ocmseprec nhnln ag-cl projects. large-scale handling in experience Holcim’s grgts(0preto hc ilb rprdon prepared be will which of percent (20 aggregates ie,ad11mlincbcmtr fready-m of meters cubic million 1.1 and site), lwterost elre.Tecnrt’ atset- fast concrete’s The larger. be to rooms the llow oteconstruc- the to xcon- ix , Innovation

Minetti has trained 2,500 employees and owners of “Red Minetti” retail outlets Award-winning project of the Holcim Foundation for Sustainable in more than 35 Argentinian cities. Construction: a river remediation and urban development scheme in the Moroccan city of Fès.

Another good example of product innovation is Holcim Switzerland’s new Optimo cement based on fired shale. For more on this, see page 23.

Rapid multiplication of a concept in Argentina The example of the Argentinian Group company “Red Minetti”shows how a successful concept to simplify housebuilding can be developed from similar projects at other Holcim companies and customized to local circumstances. In addition to high-grade cements, Minetti offers targeted services for housebuilding, renovation and home extension projects in partnership with selected distributors. The idea is that end users obtain all the materials they need, plus the necessary advice and support, from a single distributor, along with easier access to bank financing. Minetti has now trained 2,500 employees and owners of “Red Minetti” retail outlets in more than 35 Argentinian cities and thus embarked on the successful dissemination of this innovative business model over the coming years.

Award-winning construction projects of the Holcim Foundation for Sustainable Construction built with our construction materials Every three years, the Holcim Foundation for Sustain- able Construction awards prizes for innovative sustainable construction projects around the world. The buildings in question are often constructed using Holcim products. A good example is the main prize winner in 2009 – a river remediation and urban development scheme in the Moroccan city of Fès. Holcim Morocco is now supplying building materials for the refurbishment of a section of the Medina. The 2008 regional winner from Latin America is at a more advanced stage.The comprehensive plan for the urban development of the city of Medellín has realized numerous subprojects using construction materials supplied by Holcim Colombia.

34 35 Value-Driven Corporate Management H 120 CHF 140 CHF H 0 CHF 20 CHF 40 CHF 60 CHF 80 CHF 100 CHF efrac fHli hr essSisMre ne (SMI) Index Market Swiss versus share Holcim of Performance the at upswing an recorded markets equity the While einn f21,faso eeirtn European deteriorating of fears 2010, of beginning aia aktinf market Capital cnme n h ecie iko omn double looming a of risk perceived the and economies ocmcniudt ou nefcec mrvmnsand improvements efficiency on focus to continued Holcim h opn’ ahfo eeaincpct eandrobust, remained capacity generation flow cash company’s challenging. The remained conditions business as savings cost iigicesdfnnilfeiiiyt h led oi capital solid already the structure. to flexibility financial increased giving ocmrgsee share registered Holcim 2006 M (adjusted) SMI 2007 ormation 2008 i asdtemrest aehg eeso volatility of levels high face to markets the caused dip n rsueo tc eeswl notescn half second the into well levels stock on pressure and fteya.Hli hrscudntwtsadthese withstand not could shares Holcim year. the of 2009 2010 2011 Capital Market Information

widespread market uncertainties, experiencing price Geographical distribution volatility and decline following the annual peak of Switzerland 47% CHF 85.00, reached at the end of April 2010. Other countries 24% Sharespendingregistrationoftransfer 29% Improved market sentiment, combined with Holcim’s continued sound business and financial profile with an Breakdown of shareholders ongoing focus on cost savings, gave Holcim shares by number of registered shares held some positive momentum toward the end of the year. 1–100 11,874 101–1,000 38,831 The share closed on December 30, 2010 at CHF 70.65 1,001–10,000 7,648 (2009: 80.50), which is equal to a decrease of approxi- 10,001–100,000 648 mately 12 percent compared to the 2009 year-end > 100,000 104 close. Free float Listings The free float as defined by the SIX Swiss Exchange Holcim is listed on the SIX Swiss Exchange. Its shares stands at 75 percent. are traded on the Main Standard of SIX Swiss Exchange. Each share carries one voting right. At year-end 2010, Dividend policy the company’s market capitalization stood at approxi- Dividends are distributed annually. In 2003, the Board mately CHF 23.1 billion. of Directors determined that one-third of Group net income attributable to shareholders of Holcim Ltd Additional data should be distributed. For the 2010 financial year, ISIN CH0012214059 the Board is proposing a payout from the capital Security code number 1221405 contribution reserves corresponding to last year’s Telekurs code HOLN amount of CHF 1.50 per registered share.The next Bloomberg code HOLNVX payout is scheduled for May 12, 2011. Thomson Reuters code HOLN.VX Weighting of the Holcim registered share Major shareholders in selected share indices Information on major shareholders can be found Index Weighting in % on page 212 of this report. SMI, Swiss Market Index 2.23 SPI, Swiss Performance Index 1.81 Distribution of Holcim shares and breakdown SLI, Swiss Leader Index 4.27 of shareholders BEBULDM, BE500 Building Materials Index 23.32 The majority of shares held in other countries are SXOP,DowJonesSTOXX600Construction 9.49 owned by shareholders in the UK and the US. DJSIWorld,DowJonesSustainabilityIndex 0.22 FTSE4Good Europe Index 0.35

Sources: Bloomberg, Dow Jones Sustainability Indexes, FTSE Index Company, end of December 2010.

36 37 Value-Driven Corporate Management 3 2 1 6 5 4 e hr nCHF in share per CHF in e hr nCHF in share per aotdvdn e hr nCHF in share per Payout/dividend equity shareholders’ Consolidated earnings Cash share dividend-bearing per Earnings Low 255,348,625 High CHF 263,586,090 in prices 263,586,090 market Stock shares 327,086,376 treasury of capital Number 327,086,376 conditional shares of Number shares dividend-bearing of Number issued shares of Number 2 CHF value Par share registered Holcim data Key ute nomto nHli eitrdshares registered Holcim on information Further shares registered Holcim on Information a efuda www.holcim.com/investors. at found be can rpsdb h or fDrcosfrapyu rmcptlcnrbto reserves. treasury contribution (less capital shares from payout dividend-bearing a of for number the Directors of and – Board Ltd the outstanding. by Holcim of shares Proposed of shareholders outstanding number to shares average attributable of the – number by equity average weighted shareholders’ the flow on by cash Based on weighted based Ltd Holcim calculated of EPS Cash shareholders to attributable income net on based calculation bonds. EPS increases. convertible for capital reserved and/or 2008 Shares dividend stock for Adjusted hrs sprDcme 31. December per as shares) sent 16). note (see 3 5 4 1 2 2,8,7 2,8,7 6,8,9 6,8,9 255,348,625 263,586,090 263,586,090 327,086,376 327,086,376 ,3,8 ,0,8 ,3,6 6,4 679,912 668,849 5,132,061 6,905,384 7,131,083 ,2,5 ,2,5 ,2,5 ,2,5 9,659,815 1,422,350 1,422,350 1,422,350 1,422,350 14 30 30 88 16.70 18.81 13.02 13.04 11.44 85 94 94 14 59.60 71.44 59.42 59.44 58.58 0020 0820 2006 2007 2008 2009 2010 1.50 .949 .71.67.95 13.66 6.27 4.93 3.69 85 60 6 .022 .02.00 3.30 2.25 1.50 28 81 1 126 111 0102 40 103 78 Capital Market Information

Disclosure of shareholdings Registration in the share register and restrictions Under Art. 20 of the Swiss Federal Act on Stock on voting rights Exchanges and Securities Trading (Stock Exchange On request, purchasers of registered shares are entered Act), whosoever, directly, indirectly or in concert in the share register as voting shareholders provided with third parties, acquires or disposes of shares, that they expressly declare that they acquired the for his own account, in a company incorporated in shares in their own name and for their own account. Switzerland whose equity securities are listed, in The Board of Directors will enter individuals whose whole or in part, in Switzerland and thereby attains, requests for registration do not include an express falls below or exceeds the threshold of 3, 5, 10, 15, declaration that they hold the shares for their own

1 2 20, 25, 33⁄3, 50 or 66 ⁄3 percent of the voting rights, account (nominees) in the share register as share- whether or not such rights may be exercised, shall holders with voting rights, provided that such nomi- notify the company and the stock exchanges on nees have concluded an agreement with the company which the equity securities in question are listed. concerning their status and are subject to recognized Important shareholders are disclosed on page 212. banking or financial market supervision.

Current rating (February 2011) Standard & Poor’s Fitch Moody’s Long-term rating BBB,outlookstable BBB,outlookstable Baa2,outlookstable Short-term rating A-2 F2 P-2

Financial reporting calendar Results for the first quarter 2011 May 4, 2011 General meeting of shareholders May 5, 2011 Ex date May 9, 2011 Payout May 12, 2011 Half-year results 2011 August 18, 2011 Press and analyst conference for the third quarter 2011 November 9, 2011 Press and analyst conference on annual results for 2011 February 29, 2012

38 39 Sustainable Development o,aogohrtig,C2eisos h conserva- the emissions, CO2 things, other among for, ocmpae bouepirt ntehat and health the on priority work absolute at places safety Holcim and health to commitment Reinforced the and development sustainable of principle The aeymngmn ytmars t lblopera- global its across system management safety niiul otterlvswiewrigfrHolcim. for working while lives their lost individuals aeyo l mlye,sples evc providers, service suppliers, employees, all of safety ino idvriy n omnt naeetat engagement community and biodiversity, of tion in.Getiprac spae ntetann not training the on placed is importance Great tions. h or fDrcosadteEeuieCommittee Executive the and Directors of Board The betv fcetn au o l tkhlesare stakeholders all for value creating of objective n iios yipeetn rcdrssystemati- procedures implementing By visitors. and epyrge hsadaecmitdt vigorously to committed are and this regret deeply usigterga fa cietfe working accident-free an of goal their pursuing t sites. its nyo mlye,btas fcnrcos Workshops contractors. of also but employees, of only iutosaeaaye ndti n h conclusions the and detail in analyzed are risk and situations accidents all Consequently, environment. nhrdi ocmssrtg.TeGopremains Group The strategy. Holcim’s in anchored omnctdwti h Group. the within communicated al n ossety h ru sebdigacul- a embedding is Group the consistently, and cally eouei t omtetee ndfiuteconomic difficult in even commitment its in resolute ihih h oeo edrhpadresponsibility and leadership of role the highlight ueo aey h ru mlmnsadconstantly and implements Group The safety. of ture ie.Acrigy n21,teGopse Group the 2010, in Accordingly, times. oiosismulti-elemen its monitors ntefedo aeyadpooesft awareness. safety promote and safety of field the in raiainladidvda optnisare competencies individual and Organizational lal eie.Tefv cria ue”apya all at apply rules” “cardinal five The defined. clearly ie.I l ru opne,tpmngmn is management top companies, Group all In times. D example. by lead to expected niomna omtetrmisasrtgcnecessity. strategic a remains commitment Environmental niomna omtetadsca responsibility social and commitment Environmental siealo h fot nteya ne eiw 28 review, under year the in efforts the of all espite cuainlhat and health occupational t e targets new t 1 4 0 1 2 3 5 6 ottm nuyfeunyrate frequency injury time Lost yteedo 00 l ru opne a imple- had companies Group all 2010, of end the By h ru’ elhadocptoa aeydt will data safety occupational and health Group’s the otnet eidpnetyaudited. independently be to continue etdacdn rvnindrcie.Furthermore, directives. prevention accident mented e ietv a eeoe nsple safety supplier on developed was directive new a aaeetadaohro oklc aeywhen safety workplace on another and management sn lentv ul;bt r urnl being currently are both fuels; alternative using mlmne hogotteGop ntecus of course the In Group. the throughout implemented 00 ocmitgae h BS aeyguidelines safety WBCSD the integrated Holcim 2010, o rvr n upir noisitra directives. internal its into suppliers and drivers for samme fteCmn Sustainab Cement the of member a As h ottm nuyfeunyrt LIR scluae as: calculated is (LTIFR) rate frequency injury time lost The or okd aaicue l eet grgtsa elas well as aggregates cement, all includes Data worked. hours ed-i oceeoperations. concrete ready-mix ubro lost of number 2006 5.2 2007 3.9 ieinjuries time 2008 2.7 × ,0,0 : 1,000,000 1 2009 2.1 oa ubrof number total lt Initiative, ility 2010 2.0 <2 Threshold and Social Responsibility Environmental Commitment

Holcim places an absolute priority on Contribution to climate protection and energy efficiency: increased use of alternative fuels and raw materials. health and safety at work.

Promotion of environmentally friendly products The Holcim Foundation for Sustainable Construction and sustainable construction has been working to promote sustainability in the Demand for building materials continues to rise on construction sector since 2003. Further information the back of population growth, economic develop- can be found in the section headed“Key success ment, and climate change. As buildings consume factors”on page 26 of this Annual Report and at about 40 percent of global primary energy, there is a www.holcimfoundation.org. growing need for more environmentally compatible products and construction methods.The challenge Contribution to climate protection and energy efficiency for the entire construction industry is to meet the Global CO2 emissions have to be stabilized and then demand for high quality building materials while gradually reduced. Not only do all sectors of the econ- reducing the associated ecological footprint. omy need to contribute, but consumer behavior will also have to change. Climate protection and energy Holcim contributes through product and process efficiency are key to sustainability.This requires innovations. A number of Group companies have substantial investment, for instance, in production successfully launched innovative building materials processes. and services that promote more sustainable building solutions.The focus is on developing composite Holcim is an industry leader in improving the efficiency cements in which clinker content is reduced by of production processes and products continuously. increasing use of materials such as slag, fly ash, In cement production, its priorities are to reduce the and natural pozzolans. In 2010, over 77 percent of clinker content, increase the use of alternative fuels Holcim’s product portfolio comprised composite and raw materials, and improve energy efficiency. cements, compared to only 30 percent in 1990. This involves considerable efforts in research and development. This is complemented by offerings along the value chain. An example is the “Optimo” range, recently developed by Holcim Switzerland.“Holcim Optimo” uses fired oil shale to create a high quality product with a comparatively small ecological footprint. Fired shale is mixed with Portland cement clinker, high- grade limestone and gypsum, and the resulting product is homogenized. As natural shale contains organic material, it burns at lower temperatures without the need for additional fuel. Because “Holcim Optimo” uses less clinker, it substantially reduces CO2 emissions and energy consumption (see also page 23).

“Holcim Optimo” is innovative in other ways, too, offering greater durability, lower permeability, enhanced tensile strength, and lower risk of cracks.

40 41 Sustainable Development 70% 80% 90% 75% 85% 60% 65% led n20,Hli civdisontre of target own its achieved Holcim 2009, in Already euigntC2eisosprtneo eetby cement of tonne per emissions CO2 net reducing 0pretcmae o19 ees n21,emis- 2010, In levels. 1990 to compared percent 20 in eerdcdb prxmtl 1percent. 21 approximately by reduced were sions ocmi omte ofrhrpors:I a set has It progress: further to committed is Holcim teftetre frdcn O msin e tonne per emissions CO2 reducing of target the itself fcmn y2 ecn ni 05cmae othe to compared 2015 until percent 25 by cement of eeec er1990. year reference 1 cement in clinker of % lne factor Clinker h lne atri nitrmfgr n ilb pae and updated mid-2011. be by will website and our figure on interim published an is factor clinker The 1990 1 …… 2000 2008 2009 2010 700 800 500 750 550 600 650 aaecue w oe generation. power own excludes Data ocmi sn lentv ul n at materials. waste and fuels alternative using is Holcim 2 1 CO kg ocmi pligtems dacdtechnologies advanced most the applying is Holcim materials fuels raw and alternative for system certification New h eoeyo nryadmtrascnevsnatural conserves materials and energy of recovery The irgnoie Nx y2 ecn y21 n 2013, and 2012 by percent 20 by (NOx) oxides nitrogen a eore n eue lblC2eisos At emissions. CO2 global reduces and resources ral omk s fatraiefesadwsematerials. waste and fuels alternative of use make to eore n eue lblC2emissions. CO2 global reduces and resources epciey y21,Nxeisoshdaraybeen already had emissions NOx 2010, By respectively. h aetm,i ep olwrpouto ot and costs production lower to helps it time, same the h recovery The eue y1 ecn.B 00 pcfcslu dioxide sulfur specific 2010, By percent. 17 by reduced iiaepr ftewsepolm seilyi the in especially problem, waste the of part mitigate S2 msin eerdcdb 2pret the percent; 62 by reduced were emissions (SO2) rgnltre f2 ecn a e sln g as ago long as met was percent 20 of target original aig20 srfrneya,Hli a committed has Holcim year, reference as 2004 Taking 2006. teft euigspeci reducing to itself pcfcgosadntdrc O emissions CO2 direct net and gross Specific lentv fuels. alternative e O msin:acutfridrc aig,sc sueof use as such savings, indirect for account emissions: CO2 Net assurance. external to subject figures interim are data CO2 The pae msinfgrswl epbihdo u est by website our on published be will figures emission Updated mid- Gross 902000 1990 2 2011 tnecement /tonne . …… feeg n aeil osre natu- conserves materials and energy of i msin fds and dust of emissions fic 2005 2006 2007 mrvmn rate improvement 2008 euto target reduction mrvmn in improvement 1 2009 2010 Net - - - - - 30 25 15 20 10 - 2 % 0 5 and Social Responsibility Environmental Commitment

Holcim attaches great importance to the conservation of water. With its community engagement activities, Holcim aims to contribute to sustainable A new water management strategy is planned to be in place by development in the communities where it operates. In 2010, Group companies spent a 2013. total of CHF 42 million, from which some 3 million people benefited.

Thermal substitution1 Conservation of resources and biodiversity Extraction of mineral resources in quarries can have 12.1 12.0 12 11.7 11.0 11.1 an impact on biodiversity in their surroundings. 10 In 2007, Holcim signed an agreement with the Inter- 9.0 national Union for Conservation of Nature (IUCN) to 8 mitigate such impacts.With the guidance of a panel 6 of independent experts and based on numerous site 4 3.6 visits, a set of recommendations was developed. 2 These recommendations have now been adopted as the basis for a comprehensive Group strategy and 0 biodiversity management system. An independent 1990 … 2000 … 2006 20072008 2009 2010 assessment has shown that the partnership was % thermal energy from alternative fuels successful and that the main objectives of the three- 1 The thermal substitution rate is an interim figure and will be updated and published on our website by mid-2011. year cooperation agreement had been fulfilled. How- ever, Holcim and IUCN have decided to extend the partnership for a further three years.The topics of the emerging countries. In 2010, Holcim had a thermal extended cooperation include defining transparent substitution rate of 12 percent, processing a total of indicators for measuring the success of the biodiver- 3 million tonnes of waste at its production sites. sity management system, and work on the water management program. To ensure the responsible handling of waste materials in the Group, Holcim introduced a new certification Holcim attaches great importance to the conserva- system for the use of alternative fuels and raw mate- tion of water. A new water management strategy rials – ACert (AFR Certification).This system is based is planned to be in place by 2013. Measures have on internal regulations as well as guidelines for the already been taken in a number of Group companies. use of waste in the cement industry developed in After consulting with external partners, Aggregate collaboration with the German Technical Cooperation Industries has developed a comprehensive water (GTZ).The objectives of the project are to define management plan focusing on specific themes. requirements for “co-processing” activities and to provide the basis for internal and external audits. Active role in World Business Council for Sustainable The ACert project is currently being rolled out in Development Group companies that use alternative fuels and raw Biodiversity and water are also important topics for materials. By the end of 2010, more than half of the World Business Council for Sustainable Develop- Holcim’s processing facilities had been internally ment (WBCSD). Holcim is actively involved in the audited. Cement Sustainability Initiative (CSI) of the WBCSD and will be co-chair together with Votorantim (Brazil) and Siam Cement (Thailand) in 2011/2012.

42 43 Sustainable Development nwihHli prts l ru opne must companies Group All operates. Holcim which in ihiscmuiyeggmn ciiis Holcim activities, engagement community its With locations all in engagement community Strategic CSI energy, and climate, safety, health, to addition In tdterms motn oilatvte sn the using activities social important most their ated foperation of rwu omnt naeetpa htincludes that plan engagement community a up draw ist otiuet utial eeomn nthe in development sustainable to contribute to aims n oainltann.Coeclaoainwt local with collaboration Close training. vocational and crcr.Oersl a ent euecs dona- cash reduce to been has result One scorecard. oileggmn nrgoso ofiti particu- is conflict of regions in engagement Social 2012. by sites operational all ou ra ili uueas nld idvriyand biodiversity include also future in will areas focus h oprt upr ru fteInternational the of Group joined Support Holcim Corporate issue, the this address To challenging. larly tkhlesi nipnal n ep obuild to helps and indispensable is stakeholders stable a ensure to and operates it where communities in n nta xadsca rjcso eei to benefit of projects social expand instead and tions water. uulrsetadtrust. and respect mutual ohsds n21,Hli ru opne pn a spent companies Group Holcim 2010, In sides. both uiesevrnet roiyi ie odeveloping to given is Priority environment. business ocmhsdvlpda“oilEggmn Score- Engagement “Social a developed has Holcim ad ohl eemn hte h rjcsmeet projects the whether determine help to card” rmwihsm ilo epebenefited. people million 3 engagement, some community which on from million 42 CHF of total noaiesltosi h ra fafral and affordable of areas the in solutions innovative h culneso h epei h omnte in communities the in people the of needs actual the hc toeae,wiea h aetm evn the serving time same the at while operates, it which aepoe ob nefciemaso improving of means effective an be to activities proved similar have and panels neighborhood Dialog, eain ihlclsaeodr ntecommuni the in stakeholders local with relations s vriigGopgas yteedo h erunder year the of end the By goals. Group overriding eiw 5preto l ru co Group all of percent 65 review, sanbehuig iretrrs development, microenterprise housing, ustainable pne a evalu- had mpanies ties n oeacsil ae nrrlaeso ua and Sudan of areas rural in water accessible more and oain n charity and Donations projects community Infrastructure projects Education projects development Community 2010 spending Community o h ihhcneuieya,Hli a con- was Holcim year, consecutive eighth the indices For sustainability leading in Listed CHF million in Total Others C imda ebro h o oe Sustainability Jones Dow the of member a as firmed ae rjc nColombia. in project water a omte fteR the of Committee nee DS ol n JIErp) nte2010 the In Europe). DJSI and World (DJSI Indexes n rdblt fteIR aei osbet con- to possible it make ICRC the of credibility and rbt uaiainassac nafce ra.In areas. affected in assistance humanitarian tribute seset ocmrcie o crsfrisrecy- its for scores top received Holcim assessment, 00 ocmsupport Holcim 2010, ln taey niomna eotn,conservation reporting, environmental strategy, cling fboiest,itrainlpouto standards, production international biodiversity, of oilrprig ua aia eeomn,and development, capital human reporting, social ilgwt tkhle rus ocmas continues also Holcim groups. stakeholder with dialog ob mem a be to Roverhead SR e fteFS4odssanblt index. sustainability FTSE4Good the of ber dCos(CC.Teexperience The (ICRC). Cross ed da CCpormfrclean for program ICRC an ed 14% 21% 24% 18% 16% 7% 42 Human Resources

Human resources

Fit for the future thanks to efficient, transparent and demand-driven human resources management.

Holcim strives to offer its employees an attractive wide following reviews at the regional and functional working environment with international perspec- levels. tives, and to effectively support individual career planning. The quality of data and the consistency of plans have been continuously improved. Moreover, the standalone New direction for global Human Resources function database MDnet was replaced with the new SAP-based Among the measures introduced to align central succession management platform iTalent. Launched service and support functions, the activities of in December 2010, iTalent is aligned with existing Human Resources (HR) have been reorganized to bet- tools for performance management (eDialogue) and ter suit the needs of the Group companies. Senior the learning management system (Holcim iCampus) management shall be even better prepared to meet to create an integrated talent management system. the business demands of the future.The focus was on the areas of Talent Management, International Dialogue enhancements Assignments & Remuneration and the HR Knowledge Building and maintaining a high-performance & Solution Platform. By systematically exchanging culture is key to driving business value.The Dialogue best practices, exploiting synergies where they exist process provides a robust framework for performance and reducing the advice of external consultants, also management and individual development, ensuring cost savings will be possible. that employees are clear about what is expected from them and receive feedback and support in planning Building a strong talent pool their development.The annual Dialogue process Holcim places great importance on succession man- provides a comprehensive performance evaluation agement. Prospective managers and experts need to of critical tasks and individual objectives, and builds develop continually and extensively to prepare for the basis for individual development and career future responsibilities. Succession management is planning. closely linked to resource and leadership planning, performance assessment, and remuneration. The inter- In 2010, innovative measures were undertaken in connectivity of these processes provides the Group the Group-wide Dialogue process. Different levels of with a uniform base for “people planning”. performance can now be more finely differentiated, motivating employees with more targeted incentives. The 2010 talent review and succession planning cycle The corresponding processes and alignments were made use of a revised process.This included a review better structured for performance measurements of of the performance and potential of employees at individuals and teams. the individual Group companies. Succession plans derived from the findings were consolidated Group-

44 45 Sustainable Development nlssto steaiiyt ikterslst the to results the link to ability the is tool Analysis mlyeEggmn n aifcinSre.This Survey. Satisfaction and Engagement Employee RTuhon nlssi nes-oueto to tool easy-to-use an is Analysis Touchpoint HR Analysis Touchpoint Resources Human employees our of engagement the 2010, Throughout survey engagement Employee addt n mlyeeprec tHli,and Holcim, at experience employee and candidate gained companies Group Philippines. the as well as ikpoie odisgto hr ofcsthe focus to where on insight good provides link a enakytpc atclryi h otx fthe of context the in particularly topic, key a been has cinpas tas ep nrcgiighwteHR the how recognizing in helps also It plans. action h matti xeinehso mlyeengage- employee on has experience this impact the seshwaGopcmaymngsisworkforce its manages company Group a how assess ucinpromnei enb h employees. the by seen is performance function oniigadrsrcuigitoue tmany at introduced restructuring and downsizing togbs fifraino hc oda up draw to which on information of base strong a rma Rprpcie taaye o consistently how analyzes It perspective. HR an from ru opne.VrosGopcmaisopted companies Group Various companies. Group etadcmayrptto.Atvte peripheral Activities reputation. company and ment n togyH strongly and ntemdl o xml,cmuiain,branding, communications, example, for model, the on in impact direct a have that activities HR typical to survey the ran instance, for Australia, plans. action h mlyeteprec aeas enincluded been also have experience employment the ocryottegoa mlyeEggmn and Engagement Employee global the out carry to utial eeomn,adkoldemanage- knowledge and development, sustainable integration of degree the ascertain to means a as is n ftemajo the of One nies. ausSre,i oeisacsmngdjointly managed instances some in Survey, Values h olwsscesul ioe ntnGopcompa- Group ten in piloted successfully was tool The ment. ece yGopcmayHli utai,acquired Australia, Holcim company Group by reached ihetra specialists. external with n21,epoe uvy eerni Malaysia, in run were surveys employee 2010, In n2009. in hiad usa aaa e eln n A and Zealand New Canada, Russia, Thailand, li ru opne aaethe manage companies Group olcim eeiso h Touchpoint the of benefits r ustralia R throughout excellence rewarding and Recognizing plants best the for Awards h ru tallvl spr fteHli cultur Holcim the of part is levels all at Group the HS rdc ult,eeg fiiny otand cost efficiency, energy quality, product OH&S, eodwa ih esnbyb xetdcon- expected be reasonably might what beyond niomna rc eod hs wrs is and first awards, These record. track environmental rbt omkn h aus“Strength.Performance. values the making to tributs betvsaehg o aifcinadrespective and satisfaction job high are Objectives oeot eonz tf civmns hl the While achievements. staff recognize foremost, ih ehia qimn sncsay ti people is it necessary, is equipment technical right aso. eoereality. become Passion.” h ocmPatAad,etbihdi 08 formally 2008, in established Awards, Plant Holcim The engagement. h aetedfeec hni oe odelivering to comes it when difference the make who eonz h etpromn n otimproved most and performing best the recognize wrswr ie opat nAgnia ni and India Argentina, in plants Plant to Holcim given 2010, were In Awards Group. the in plants cement xelnea plant. a at excellence Mexico. odtrietebs lns efrac a meas- was performance plants, best the determine To rdadaaye sn se a using analyzed and ured cgiino civmnsadddcto htgo that dedication and achievements of ecognition fidctr uhas such indicators of t e. Human Resources

Group employees by segments 2010 2009 2008 2007 2006 1 Including all other cementi- Cement1 51,133 50,335 56,282 57,671 57,878 tious materials. Aggregates 6,478 6,850 6,369 7,000 7,136 Otherconstructionmaterialsandservices 22,577 23,725 23,692 24,567 23,724 Corporate 122 588 370 126 45 Total Group 80,310 81,498 86,713 89,364 88,783

Group employees by region 2010 2009 2008 2007 2006 Europe 19,690 20,800 23,557 22,905 22,006 North America 6,668 8,016 9,825 11,190 11,268 Latin America 12,710 12,626 13,548 13,409 12,234 Africa Middle East 2,213 2,256 2,477 2,795 5,218 Asia Pacific 38,172 36,858 36,196 38,133 37,212 Corporate 857 942 1,110 932 845 Total Group 80,310 81,498 86,713 89,364 88,783

Origin of senior managers From Europe: 24 nationalities 38% of all senior management From North America: 2 nationalities 10% of all senior management From Latin America: 11 nationalities 18% of all senior management From Africa Middle East: 7 nationalities 3% of all senior management From Asia Pacific: 18 nationalities 31% of all senior management

Composition of senior managers Male Female Total Percentage of women Top management level 306 31 337 9% Senior management level 1,302 112 1,414 8% Middle management level 7,056 1,008 8,064 13% Total 8,664 1,151 9,815 12%

Personnel expenses in 2010 by function and region Million CHF Production Marketing Administration Total anddistribution andsales Europe 980 167 255 1,402 North America 627 57 109 793 Latin America 360 68 101 529 Africa Middle East 61 10 24 95 Asia Pacific 685 91 210 986 Corporate 46 22 162 230 Total Group 2,759 415 861 4,035 46 47 Gravel Pit El Puente, Spain rvlptE une Spain Puente, excavators: El gravel pit the Gravel between birds for paradise A h rvlpto lPuente. El of pit gravel The Gravel Pit El Puente, Spain

Information board to indicate certain The El Puente gravel pit lakes, inhabited by thousands of birds, The El Puente’s zone of protection dangers. are today a zone of special protection. measures 180 hectares.

48 49 Gravel Pit El Puente, Spain lPet rvlpt nSsñ r ainlyand nationally a are Seseña in pits gravel Puente El lPet nSan ocmsoshwatv prtoscan operations active how shows Holcim Spain, in Puente El betv,teambigt raealnsaetypical landscape a create to being aim the objective, proj- astute to all above recognition this owes Holcim advance in end the Planning its and 1980, since Spain in operated has Holcim excavators while gravel of tonnes remove trucks day, Every n nteln em Wa a mre eeis here emerged has “What term. long the in ing million one to up of output annual because significant only the not of but – site well-known internationally ucsflyc-xs ihsniieeooia areas. ecological sensitive with co-exist of successfully pits gravel the At birds. countless for ground breeding a ftergo.Ti betv iie h hieo flora, of choice the limited objective This region. the of al- had pits the of rehabilitation The planning: ect i hi a epit h rud e ih etdo is door next right Yet ground. the into deep way their dig sddteciae–wt t r umr n inhos- and summers dry its with – climate the did as etrta htwsbfr” asMne R Manuel says before”, was what than better ial itr.Afrhramwst etteneeds the meet to was aim further A winters. pitable began excavator first the before planned been ready onso rse tn:E unei aosbecause famous is Puente El stone: crushed of tonnes rvsta clg n uiesd o necessarily not do business and ecology that proves ffuai h etpsil a.T ipiytesub- the simplify To way. possible best the in fauna of etais re ai.Suho ard Holcim Madrid, of South and oasis. live green birds a of amidst species nest hundred two about where is it ozlzBro,EtariayPoesra the at Professor Extraordinary González-Barros, y digging ls n htntr a vnbe even can nature that and – clash eatetfrCytlorpyadMnrlg at Mineralogy and Crystallography for Department eun eaiiainpoet udmna okwas work fundamental project, rehabilitation sequent h elg aut fteCmltneUniversity Complutense the of Faculty Geology the are u eoeqarigbgn o xml,the example, For began. quarrying before out carried nMadrid. in t a notegae.I a nambitious an was It gravel. the into way its aePrl wmhnwt cobalt with Swamphen Purple Rare lmg n e beak. red a and plumage ei rmquarry- from nefit egueiro eoe n trdfrltruei h reforestation the in use later for stored and removed a enrnee o te eddt ereshaped be to needed steep too rendered been had uryn prtoslf isetnigt et of depth a to extending pits left operations Quarrying dream biologist’s A fteae.Teecvtrdiesas eddt en- to needed also drivers excavator The area. the of 3yas h otuso h ak eesae and shaped were banks the of contours the years, 13 . ees hc aual ildwt groundwater. with filled naturally which meters, 9.3 ihafatrsoe h ou a loo monitoring on also was focus The slope. flatter a with ueta h al n de ftept i o form not did pits the of edges and walls the that sure h oko h pcait ea ttesm time. same the at began specialists the of work The e sad rae.Tesi hthdbe trdwas stored been had that soil The created. islands new tagtlns steewudhv okdunnatural looked have would these as lines, straight ae ult n otnal piiigscin of sections optimizing continually and quality water itiue rudtenwlks nbigpat to plants enabling lakes, new the around distributed ne h uevso fbooitTmsVelasco, Tomás biologist of supervision the Under olwn restoration. following aia.I l en hr a o od u every- but – do to lot a was there meant all It habitat. n novdwshgl oiae.“o ilgs,it’s biologist, a “For motivated. highly was involved one eteadgo.Vlsoadhsclege created colleagues his and Velasco grow. and settle elns re pt,a ela ml ra fforest. of areas small as well as spots, drier wetlands, h a b has who ra ogtteopruiyt atcpt ncreat- in participate to opportunity the get to dream a o,frielyro olaoetegae a carefull was gravel the above soil of layer fertile top, suul oee,tecalneotnlyi h detail: the in lay often challenge the however, usual, As aqua eas ih olne eertdt h otmand bottom the to reduced penetrated be to longer no had lake light the because of depth the places, many In i lnscudteeoentsrie ak that Banks survive. not therefore could plants tic e vreigrhbltto o h past the for rehabilitation overseeing een h upeHrni loarr idspecies; bird rare a also is Heron Purple The elwfeet. yellow ti upege n a eds lmg and plumage reddish has and purple-grey is it y Gravel Pit El Puente, Spain

Of the endangered Watering the roads hinders dust In the rehabilitated area live a variety duck Schoolchildren from Madrid plant trees species Mediterra- formation. species, among them the Ferruginous Duck, in one of El Puente’s restoration areas. nean Gull live less a species that is in danger of extinction. than 20 couples in all of Spain.

ing a bit of nature like this”,Velasco enthuses.The Honor and obligation realization of the dream is certainly viewed as an Sharing his view is Christoph Imboden,chair of the exemplary achievement by those in the profession. independent expert panel assembled by IUCN that “The ecological measures taken in the gravel pits of advises Holcim at the Group level on how to best inte- El Puente for the rehabilitation project bear witness to grate biodiversity:“Holcim shows that it is possible Holcim’s commitment to sustainable development”, to manage natural resources on a sustainable basis. says Margarita Astrálaga, former Director of the The firm is constantly endeavoring to develop a set Centre for Mediterranean Cooperation at the Inter- of worldwide guidelines for its quarrying operations national Union for Conservation of Nature (IUCN). that enable it to tackle the issue of biodiversity.” Holcim consciously plays a pioneering role within Diverse flora is attracting fauna the industry, and has also received accolades for Diverse flora is the basis for flourishing fauna – and this commitment:In 2010,Holcim Spain won the Euro- indeed it didn’t take long after rehabilitation for the pean Aggregates Association’s European Sustainable fauna to arrive,with El Puente becoming a paradise Development Prize in the biodiversity category for its for birds. Some species use the created islands and rehabilitation of El Puente. Carlos Abella, former Re- dense vegetation as a nesting place; others simply gional Head for Aggregates at Holcim Spain,is aware stop by here on their annual trip south because El that such an award also brings with it responsibilities: Puente lies on one of the main routes for migratory “Being a member of the prize-winning team is at once birds. Around 200 species of birds have now been an honor and an obligation.”In fact,El Puente is still recorded at the 180 hectares of El Puente. Some of far from being completed:The excavators will be them are among very rare species or even threatened digging pits there for another five to ten years.But at by extinction – such as the Mediterranean gull,purple the same time, the paradise for birds that is El Puente swamphen, white-headed duck, squacco heron, and will continue to grow. ferruginous duck. But other species of animal also feel at home here:fish,foxes,wild rabbits and stone martens. By preserving existing habitats and creating new ones,a whole variety of wildlife is attracted. “This way,a maximum degree of biodiversity has been achieved”, says Javier Andrada Andrada, Chairman of the Spanish Association of Aggregate Producers (Asociación Nacional de Empresarios Fabricantes de Áridos, ANEFA). El Puente, he said, was positive proof that the industry could create valuable ecosystems if it was committed to sustainability.

50 51 Business Review 1

Once rehabilitated, the landscape looks completely natural again.

Group Cement plant Capacity expansion Grinding plant/Cement terminal Capacity expansion Aggregates

Participation Aggregates

1 Group Region Europe

Mixed market development in Europe

Economic recovery in some markets 5.9 percent to 16 million cubic meters, and shipments After an extremely harsh winter, economic activity of aggregates declined by 1 percent to 77.6 million improved above expectations in some Western tonnes. Sales of asphalt experienced an increase of European countries – notably Germany and the UK. 1.8 percent to 5.7 million tonnes. In Southern and Eastern Europe, however, the economic framework remained difficult throughout the year due In the UK, the government stimulus program launched to the high levels of debt. Russia’s economy benefited in 2009 continued to have an impact.The construc- from resurgent commodity markets. tion sector was supported by investment in schools, hospitals and public transportation. Although a num- Sluggish construction activity in overall terms ber of customers postponed construction projects, In many areas, the construction industry was still Aggregate Industries UK was able to secure additional confronted with the prolonged impact of the global orders and sold more aggregates. Sales of ready-mix economic crisis. Government stimulus measures sup- concrete only slightly decreased from the previous ported the order books in some areas only. Commercial year’s level, despite deliveries in connection with con- construction continued to suffer from reluctant private struction work for the 2012 Olympic Games beginning investors. Housebuilding showed positive signals here to come to an end. Asphalt sales outperformed the and there, predominantly in Western Europe.While a 2009 level. recovery in the construction sector could be observed in the first six months of the year, activity leveled out again in the second half. ConsolidatedkeyfiguresEurope 2010 2009 ±% ±%LFL* Production capacity cement Overall, construction activity increased in several in million t 50.0 49.4 +1.2 Western European markets following the weather- Cement and grinding plants 40 39 related setbacks of the first quarter.The exceptions Aggregates plants 259 266 were Spain, Italy, and the Netherlands. Construction Ready-mix concrete plants 578 598 activity in the Eastern European countries declined Asphalt plants 58 67 due to a lack of willingness to invest on the part of Sales of cement in million t 26.2 26.9 –2.6 –3.3 the public sector and private households. Although Sales of mineral components some infrastructure projects were continued, govern- in million t 1.6 1.5 +10.9 +10.9 ments reduced their spending and shelved construction Salesofaggregatesinmilliont 77.6 78.4 –1.0 –1.7 projects. Surplus capacity in the building materials Sales of ready-mix concrete industry resulted in tighter competition and falling in million m3 16.0 17.0 –5.9 –6.5 prices. Sales of asphalt in million t 5.7 5.6 +1.8 +1.8 Net sales in million CHF 6,535 7,320 –10.7 –5.5 Fall in shipments due to weather and economic factors OperatingEBITDAinmillionCHF 1,045 1,232 –15.2 –10.8 Consolidated delivery volumes in Group region Europe OperatingEBITDAmarginin% 16.0 16.8 fell as a result of weather and economic factors. Sales Personnel 19,690 20,800 –5.3 –5.5 of cement declined by 2.6 percent to 26.2 million * Like-for-like, i.e. factoring out changes in the scope of consolidation and currency tonnes. Deliveries of ready-mix concrete also fell by translation effects.

52 53 Business Review eesuppo were nrae.Simnso eetadraymxconcrete ready-mix and cement of Shipments increased. eieiso grgtsadraymxconcrete ready-mix and aggregates of Deliveries hc san is which diinly mot fetdcmn ae nBelgium. in sales cement affected imports Additionally, Rochelle, La in plant grinding cement new a of struction er ocmIayscmn eieiswr nprwith par on were deliveries cement Italy’s Holcim year. akt ufrdfo etandgvrmn spending. government restrained from suffered markets con- the for permission gave authorities 2010, December nBlimadteNtelns uligmaterials building Netherlands, the and Belgium In ae nrae n hpet fageae elnd In declined. aggregates of shipments and increased sales fiscpct n xedn oue fteprevious the of volumes exceeding and capacity its of atsS-aar mottria.Raymxconcrete Ready-mix terminal. import Nantes/St-Nazaire eutn nHli wteln rdcn otelimits the to producing Switzerland Holcim in resulting oeent oo temi ae2013. late in stream on go to foreseen e rnigpati oe n h custo fthe of acquisition the and Rouen in plant grinding new ie l emnso h uligmtrasindustry, materials building the of segments all fited cnmcgot nSizradwssld hsbene- This solid. was Switzerland in growth Economic nana aaiyo . ilo onso eet is cement, of tonnes million 0.6 of capacity annual an otiue oti development. this to contributed rmteDtenasnpatt wteln also Switzerland to plant Dotternhausen the from osrim ocmSuhr emn odsignificantly sold Germany Southern Holcim consortium. ae eeas upre ytecmisoigo a of commissioning the by supported also were sales iuto nteSutatrgo n nrae exports increased and region Stuttgart the in situation h osa akt fWsenFac.Tepat with plant, The France. Western of markets coastal the u olwitrs ae n a ras iigcement Rising breaks. tax and rates interest low to due emn’ cnm eoee osdrbyfaster considerably recovered economy Germany’s Antwerp. eieta osrcini rnedvlpdpositively developed France in construction Residential hog eieist h odSra a pipeline gas Stream Nord the to deliveries through and housebuilding private particular, In others. than oetcdmn u owahradcompetitive and weather to due demand weaker domestic offset partially Germany Holcim positively. osrcinatvt ntepbi etrdeveloped sector public the in activity construction odtoswt ihrlvlo xot,especially exports, of level higher a with conditions ecmn n lne.Tepstv market positive The clinker. and cement e mor te tpt etrpsto ocmFac in France Holcim position better to step other tdb niprattne rjc in project tunnel important an by rted h akt fEsenadSuhatr uoesuf- Europe Southeastern and Eastern of markets The h ee f2 of level the ee usatal f substantially fered eln nteohrsegments. other the in decline nl ekmre.Dlvr oue otne to continued volumes Delivery market. weak ently ocmSanwsal osl oecmn napersist- a in cement more sell to able was Spain Holcim ihrdlvre fraymxcnrt.Det exports, to Due concrete. ready-mix of deliveries higher ia eini rprto o xo21 eutdin resulted 2015 Expo for preparation in region Milan egm.Hwvr eeomn rjcsi h Greater the in projects development However, Bergamo. h eprr lsr faohrpouto ienear site production another of closure temporary the h n f21.I elcsteSve-r e line, wet Soviet-era the replaces It 2010. of end the segment. concrete ready-mix the in volumes sales eutn nsbtnilcs aig.ApaCement Alpha savings. cost substantial in resulting at production clinker first started plant Shurovo the ytepbi swl spiaesco.DsieEU- Despite sector. private as well as public the by h usa cnm eoee rmtecii,sup- crisis, the from recovered economy Russian The ilaheeassandipoeeti t market its in improvement sustained a achieve will eulc l ru opne eoddlwrcement lower recorded companies Czech Group Holcim all of Republic, exception the With decline. a showed activity construction projects, infrastructure funded oiinadas e e tnad nenvironmental in standards new set also and position a and markets commodity prospering by ported einadepnino nrsrcuepoet a a had projects infrastructure of expansion and region in increase The 2009. in than better slightly were and rvt eieta osrcini h rae Moscow Greater the in construction residential private at sales cement Thus, measures. stimulus of number eieis ocmBlai a diinlyafce by affected additionally was Bulgaria Holcim deliveries. lotofe h eln npiaehousebuilding private in decline the offset almost slowed growth economic Azerbaijan, In protection. i positive rai,Hli oai n ocmBlai out- Bulgaria Holcim and Romania Holcim Croatia, a infrastructure in investment massive However, slightly. year the of half second the in up picked Cement Alpha mot rmTre.I grgts elnsa Holcim at declines aggregates, In Turkey. from imports ege h oiietedi ugr,CehRepublic Czech Hungary, in trend positive the weighed n Sl and tvt.Dsieipr rsuefo usa Iran, Russia, from pressure import Despite ctivity. vka nyi ebawsHli bet increase to able Holcim was Serbia in Only ovakia. pc.Tenweeg-fiin inln at line kiln energy-efficient new The mpact. 0.Slso grgtsfl hrl u to due sharply fell aggregates of Sales 009. o ako ilnns oinvest to willingness of lack a rom Group Region Europe

Georgia and Turkey, cement deliveries by Garadagh Holcim France has installed a series of solar panels at its Cement slightly exceeded the previous year’s level. Rochefort site quarry. In 2011, Aggregate Industries UK Work on the construction of a new kiln line,which will will continue to invest in wind power plants at various produce around 1.7 million tonnes of cement from 2011, operating sites.The Untervaz (Switzerland) and Alesd is proceeding. (Romania) plants are building ultra-modern facilities for the generation of electricity from waste heat. Rise in trading volumes at Holcim Trading Madrid-based Holcim Trading achieved a trading volume The utilization of decommissioned wind turbine rotor of 21 million tonnes in 2010 – 7.3 percent more than in blades got off to a successful start at Holcim Germany’s the previous year.The Asian markets remained relatively Lägerdorf plant.This reusable material can be used as stable amid rising inter-regional volumes. As demand fuel,and at the same time serves as an additive.While for imports weakened in the Middle East, the region the Alesd and Campulung plants in Romania as well as became a net exporter. Africa remained an importer, as Beli Izvor in Bulgaria increased their use of sorted indus- did Latin America – with Brazil and Chile in particular trial and domestic waste as alternative fuel, Holcim increasing their imports.Trading in the US and Europe Spain utilized more wood chips in clinker production. was rather sluggish. Holcim France switched from truck to rail transportation Significantly lower operating result for imports of aggregates from Belgium,as well as for Operating EBITDA for Group region Europe declined by clinker transport from the Obourg plant to the new 15.2 percent to CHF 1,045 million,above all due to weak Grand-Couronne grinding station near Rouen. Aggregate markets in Southern and Southeastern Europe, but also Industries UK is likewise focused increasingly on trans- because of the weak euro.This figure includes sales of portation by rail or waterway for shipments of aggre- CO2 emission certificates totaling CHF 95 million (2009: gates. 90).The cost-cutting measures at many Group companies only partly offset the decline in volumes and prices. Better demand trend The internal operating EBITDA development came to In Western Europe, demand for construction materials –10.8 percent. will remain subdued. However, a modest recovery is to be expected. In most countries of Eastern and Greater environmental efficiency through alternative fuels Southeastern Europe, the situation in the construction and raw materials sector is unlikely to change fundamentally. Despite In 2010, several Group companies once again invested the expected moderate increase in volumes across all in facilities for the preparation and utilization of alter- segments, Holcim will also give high priority to costs native fuels and raw materials,as well as optimized in 2011. process technology for the use of such materials in the clinker manufacturing process.These measures made an important contribution to the continued reduction in CO2 emissions. Other measures designed to tackle climate change include the installation of facilities to use waste heat, solar or wind energy.

54 55 Milton Quarry, Canada h itnqar sajcn otentrlwolnso h igr Escarpment. Niagara the of woodlands natural the to adjacent is quarry Milton The 0,0 e trees: new 100,000 itnqar,Canada quarry, Milton h epr Frog. Leopard the aia o ait ffua including fauna, of variety a for Habitat Milton Quarry, Canada

Queen Anne’s Lace is Today, biodiversity in Milton quarry is higher than before excavation. Here, also the Monarch Butterfly a Ladybug’s treat. feels at home.

56 57 Milton Quarry, Canada ubro odtosbfr h com the before conditions of fulfill to number a had Dufferin Accordingly, UNESCO. Biosphere by World a Reserve declared been has area sensitive geological and unique 700-kilometer-long, than more onre rsne sbs rcie h uryin quarry the practice: best that as those presented among was countries project Holcim A diversity. h ovnino ilgclDvriyi Nagoya. in at Diversity practice Biological best on of Convention example the an as environmental the showcased that were measures successful so been have Milton in iest a edi aa.Tepriiat dis- participants The Japan. in held was Diversity itn Canada. Milton, usdtenwtresfrhligtels fbio- of loss the halting for targets new the cussed eaiiaino t eltdpt n uris h efforts The quarries. and pits depleted its of rehabilitation he ofu ilo onso tn aebe mined been have stone of tonnes then, million Since four 1962. to in three limestone dolomite quarry to begin h uryi ntes-aldNaaaEcrmn.This Escarpment. Niagara so-called the on is quarry The of vicinity immediate the in location its and hectares Aggregates, Dufferin by operated is Milton in quarry The site sensitive a at Working Biological on Convention the to Confer- the Parties of the of meeting ence tenth the 2010, October In proper the to Holcim importance country. great the attaches for therefore biodiversity Canada of has loss that a tree mean each can this, fallen Despite vast. are forests Canada’s nulyadti aei ieyt emitie for maintained be to likely is rate this and annually h ln xetoa,hwvr sisntrllocation: natural its is however, makes exceptional, What plant area. the metropolitan the of in suppliers products stone leading the of one is Dufferin Toronto, nte 5years. 25 another 5 of site its to Thanks Canada. Holcim of division a rudteetato raaemon- are area extraction the temperatures around and levels water The itored. aycould pany 50 eyldwtri used. is water recycled ordc t niomna otrn,acoe-opsse of system closed-loop a footprint, environmental its reduce To hscalnewt verve. with challenge this fet fqarigo idvriy”Dfei meets Dufferin biodiversity.” on quarrying of effects a edn ordc ree vi h negative the avoid even or reduce to done be can IC)a navsr ae oHli,kos Alot “A knows: Holcim, to panel advisory an as (IUCN) nentoa no o osraino Nature of Conservation for Union International needn ru feprsasmldb the by assembled experts of group independent h o the oet,rfrsainpasamjrrl.Tetrees The role. vast major of a country plays this In reforestation healed. forests, be can landscape the sdfrti ups nld emuhpn,dog- pine, weymouth include purpose this for used of One Escarpment. the on decisions use land guide r emo xet osdrhwtesaslf in left scars the how consider experts of team ary onig.CrsohIbdn himno the of chairman Imboden, Christoph roundings. igr sapetPa NP aeit lc to place into came (NEP) Plan Escarpment Niagara ra r eaiiae nhroywt hi sur- their with harmony in rehabilitated are areas n rcsqar h etscin ninterdisciplin- an section, next the quarry trucks and the 1985, In Escarpment. Niagara the of activities area all the regulated in had (NEPDA) Act Development ogtr,ogigts.Wieteecvtr,drills, a excavators, is the quarry While the task. of ongoing portion long-term, spent the of Rehabilitation planted trees 100,000 than More and Planning Escarpment Niagara the 1973, Since plan to according Everything jcie ftepa st nueta depleted that ensure to is plan the of bjectives Milton Quarry, Canada

Employees are Insects and plants are critical components of a healthy The Milton quarry rehabilitation is a self-sustaining ecosystem. actively partici- ecosystem. pating in the rehabilitating.

wood, white spruce, oak, and maple. Each year Recognition with future during Earth Week, Dufferin organizes a large tree- The rehabilitation efforts in Milton have already planting campaign in conjunction with partners received widespread recognition. For example, the such as Scoutrees for Canada and the Halton Ontario Stone Sand and Gravel Association Award of Conservation Authority – with resounding success: Excellence, the Conservation Halton Ralph Sherwood In 2008, the 100,000th tree was planted. Conservation Award and the National Stone Sand and Gravel Association Environmental Eagle Award. Natural integration This recognition is an important signal: Quarrying In the meantime, the Milton rehabilitation plan has does not have to be a permanent scar in the land- grown to encompass far more than reforestation. scape – if done with circumspection and responsi- The goal is to completely integrate the“new”land- bility.With this approach it is possible to have heavy scape where stone was extracted into the surround- earth-moving machinery quarrying stone just a few ing area.The materials found in the quarry – earth, meters away from flourishing fauna and flora, hikers water, stone, sand, gravel, etc. – are being used to enjoying nature, and children playing baseball. One help create wetlands, meadows, and lakes. Over time, day, when the quarry is completely exhausted and this diversity of biotopes has become a habitat for rehabilitated, hundreds of hectares of intact nature hundreds of species of animals and plants.The on- will be handed over to the local environmental going monitoring of the rehabilitated areas of the organization Conservation Halton. And then the quarry has revealed the existence of not only 325 former quarry will become part of the largest cohe- plant species, but also 235 animal species: birds, sive protected natural environment in the Greater insects, amphibians, reptiles, and mammals. All of Toronto area. them are living proof that, with expertise and the appropriate measures, an ecosystem can be revived.

Instructive especially for schools People, too, have returned to the rehabilitated area. Every year, Holcim organizes more than 100 lectures, courses,and other events on the site of the Milton quarry. Most of the tours are aimed at school groups and deal with topics such as geology, environmental management, and rehabilitation. In addition, there are regular tours for environmental organizations. Dufferin is also a founding member of the Bruce Trail Association, which tends the longest uninterrupted hiking trail in Canada. A portion of the 1,300-kilometer Bruce Trail passes through Dufferin lands, where a pedestrian bridge offers hikers fascinating views of the quarrying operations from a safe distance.

58 59 Business Review 2

Natural vegetation and forests thrive adjacent to the quarry.

Group Cement plant Grinding plant/Cement terminal Aggregates

60 Group Region North America

Some stimuli in North America

Still no sign of a sustained recovery Holcim, cement consumption continued to rise due In mid-2009, the US economy seemed to show to solid domestic demand. signs of a recovery due to a number of government stimulus measures. The public’s confidence in a Partially higher sales volumes sustained economic recovery was only partially Due to the exceptionally severe winter across large restored. So, investment activity and consumption parts of the US, Holcim US sold significantly less remained subdued. However, Canada’s economy cement in the first quarter of 2010. However, delivery benefited from government stimulus programs and volumes rose over the course of the year. Alongside a strong demand for commodities. But here, too, unfavorable weather conditions, lacking demand growth leveled off during the course of the year. for residential and commercial real estate impacted volumes. Shipments for industrial construction Decline in US construction investment; projects and infrastructure investments provided stable construction activity in Canada some compensation. On balance, cement sales of Construction activity remained weak in the US, Holcim US increased. and the high level of unemployment impeded housebuilding. A record number of foreclosures and the expiration of homebuyer subsidies in the first half of the year clearly slowed demand. In fact, house sales rose unexpectedly in the fall of 2010, but a Consolidated key figures considerable recovery has yet to materialize. Also North America 2010 2009 ±% ±%LFL* investment in commercial and industrial construc- Production capacity cement tion still declined. However, the healthcare and in million t 23.2 20.6 +12.6 cultural sectors were the exceptions. Cement and grinding plants 19 19 Aggregates plants 97 105 The effects of the US federal government’s stimulus Ready-mix concrete plants 187 198 program for the infrastructure sector were reduced Asphalt plants 47 47 by project delays and cancellations by the states Sales of cement in million t 11.1 10.7 +3.7 +3.7 and municipalities, whose budgetary positions Sales of mineral components are dire in some cases. In the second half of the in million t 1.5 1.3 +11.6 +11.6 year, fortunately, the public authorities approved Salesofaggregatesinmilliont 39.2 40.2 –2.5 –2.5 several infrastructure projects particularly in road Sales of ready-mix concrete building. in million m3 5.6 5.5 +1.8 +1.8 Sales of asphalt in million t 4.9 5.4 –9.3 –9.3 In Canada, cement consumption rose thanks to Net sales in million CHF 3,240 3,480 –6.9 –6.6 government-subsidized residential construction as OperatingEBITDAinmillionCHF 460 400 +15.0 +14.3 well as infrastructure spending.This was driven not OperatingEBITDAmarginin% 14.2 11.5 only by road building but also expansion in the oil, Personnel 6,668 8,016 –16.8 –16.8 gas, electricity and steel industries. In the Ontario * Like-for-like, i.e. factoring out changes in the scope of consolidation and currency and Quebec markets, which are important for translation effects.

60 61 Business Review fstpr ftedciei oue nohrregio other in volumes in decline the of part offset hr nteMdethle h ru company Group the helped Midwest the in share mrc oeb . ecn o1. ilo tonnes. million 11.1 to percent 3.7 by rose America h er nraymxcnrt,ahge market higher a concrete, of end ready-mix the In year. toward on the improved demand Seaboard country; the Eastern of the northeast and west the ex US Industries Aggregate of weakness the and industry construction US the i oceers y18prett . ilo cubic million 5.6 to percent 1.8 by rose concrete mix in particularly declined aggregates of Deliveries North region Group in deliveries cement Overall, declined. exports dollar, US the vrl,cnoiae hpet fageae fell aggregates of shipments consolidated Overall, concrete. mix project. building road significant a to due tained, in crisis the to Due mid-year. from slow to growth ohsiae rdcin A requiring production. concrete, sophisticated supplied ready-mix were tunnel high-quality Falls with Niagara the as such . ecn o3. ilo ons ae fready- of Sales tonnes. million 39.2 to percent 2.5 economic caused legislation tax in changes and etos otiue oters nslso ready- of sales in rise the highway to various contributed and sections, Airport Montreal as such projects a construction showed Demanding particular increase. in marked concrete ready-mix of ments main- materials building of Washington shipments the in were Only region segments. all across volumes oetceooy oee,hge neetrates interest higher However, economy. domestic ae nQee,btbnftdi nai rmmore from Ontario in benefited lower but slightly Quebec, in saw sales company Group remained The stable. aggregates of nearly deliveries Canada, Holcim At declined. asphalt of Sales rmgvrmn tmlsporm n stable a and benefited programs Canada stimulus Holcim year, government the from of half first the In uyn osrcinatvt nTrno hr,ship- There, Toronto. in activity construction buoyant eine elnn sales declining perienced s ao projects, major lso ns. lsr fohrpat an plants other of closure ol ilpat hc eeie rmtetemporary the from benefited which plant, Hill Holly n nryefcetpathsbe supplying been has plant energy-efficient and o ac t rvosya’ result. year’s previous its match not utmr ln t along customers a aeil.Ti a atclryahee tits at achieved particularly was This materials. raw etofcas ic h ideo 09 hscost- this 2009, of middle the Since officials. ment orgru otmngmn nteUS, the in management attributable cost was rigorous result to improved The positive. clearly mrvdisrsl.AgeaeIdsre Scould US Industries Aggregate result. its improved o49mlintonnes. million 4.9 to ntepeec fnmru ihrniggovern- high-ranking numerous of presence the in ecn,itra prtn BTAgot was growth EBITDA operating internal percent, eeiv ln.Hli aaaas significantly also Canada Holcim plant. Genevieve tt fMsor a nuuae nJn ,2010, 4, June on inaugurated was Missouri of state hog h nrae s fatraiefesand fuels alternative of use increased the through nrae y1 ecn oCF40mlin t14.3 At million. 460 CHF to percent 15 by increased ees eieiso shl elndb . percent 9.3 by declined asphalt of Deliveries meters. oteefcec an eutn rmtenwSte. new the from resulting gains efficiency the to h e t.Gnveecmn ln nteUS the in plant cement Genevieve Ste. inaugurated US new the The in plant cement Largest vigorous the on is emphasis The 2010. April of as ager Aggregate and US Industries Holcim companies, US Group the two in The structure organizational Streamlined ocmU mrvdisC2fopitadcosts and footprint CO2 its improved US fuels Holcim alternative in advancement Further America North region Group for EBITDA Operating result operating Higher US. the in environmentally plant Ste. most and port, friendly own largest its the as is well Genevieve as mil- 4 cement, of of capacity tonnes lion production a With Missouri. and nifraintechnology. information in xliaino yege tteoeaiglvland level operating the at synergies of exploitation S r o eotn oaU raMan- Area US a to reporting now are US, ecthetae fMississippi of area catchment he asdtepooto of proportion the raised d u also but Group Region North America

alternative energy sources it uses to well in excess Slight growth in volume expected for 2011 of 50 percent. Holcim US also achieved an increase Despite the generally brighter economic situation, in sales of GranCem®, a product based on granu- the North American construction industry is not yet lated slag and fly ash. expected to enjoy a significant recovery.The residential construction market in the US will at best At Holcim Canada’s Joliette plant, old asphalt shingle enjoy a modest revival. In the infrastructure sector, and plastic materials have recently been used much depends on the availability of government for kiln firing.The Mississauga plant increased the resources, as well as the realization of planned proportion of petroleum coke used. stimulus programs. Overall, cement consumption should rise slightly. In Canada, construction activity Holcim US strengthened its presence in the field of in 2011 will probably remain similar to the previous sustainable construction. As LEED (Leadership in year’s satisfactory level. Although the Canadian Energy and Environmental Design) certification of economy will still not be receiving much impetus buildings is gaining in significance, a program was from the US, government stimulus programs should developed to provide construction engineers and have a positive impact on the construction sector. architects with an easy way to calculate the proportion of recycled material used in the concrete of their building projects.

Aggregate Industries US has 56 ready-mix concrete plants certified with the “Green Star” label from the National Ready Mixed Concrete Association (NRMCA) on the basis of environmental management. No other producer of ready-mix concrete in the US can boast as many certified plants.The NRMCA rated the plants in Colorado and Minnesota first and second for their efforts in protecting the environment.

62 63 Rehabilitation at Puesto Viejo, Argentina eaiiaina usoVeo Argentina Viejo, Puesto at Rehabilitation biodiversity: Large-scale nrsPlvcn sawre ttePet ij site. Viejo Puesto the at warden a is Palavecino Andrés Wo”Lily. “Wood” Argentina Rehabilitation at Puesto Viejo,

Red-legged Seriema. The Red Iguana “Caraguay” lives here. Paper tree – endangered, endemic This bird species is typical species from Northwestern Argentina. of the mountainous province Chaco.

64 65 Argentina Rehabilitation at Puesto Viejo,

Ivan Escalier (left), from Bosque Modelo Jujuy, who is monitoring the rehabilitated A reforested wooded area. site, and Armando Molina, the Quarry Coordinator.

Holcim has adopted a particularly proactive approach toward biodiversity and sustainability at one of the largest quarries in the Group:A master plan is being put into effect in Puesto Viejo in Northern Argentina.The UN Food and Agricultural Organization (FAO) has already paid tribute to the plan.

The rehabilitation of a quarry is a laborious process. population. The cooperation between Minetti and It is not enough to fill pits and plant a few trees and BMJ led to the founding of a tree nursery in the same shrubs – at any rate not if, like Holcim, your basic year. Each year, thousands of indigenous seedlings principle is to leave an area in the same or better are cultivated, sold or used in forestation programs. condition than you originally found it. All Holcim At the same time, the tree nursery provides employ- Group companies worldwide follow this guiding idea. ment for trainee biologists and the local population. In Argentina, the Group company is Juan Minetti, which, with more than 1,300 employees and an Seeds for the future annual production volume of 4.2 million tonnes, is Another important step in favor of biodiversity was one of the largest suppliers of cement in the country. taken in 2004 when Minetti, in conjunction with the German embassy in Argentina and the Centro de A big opportunity for a big area Rehabilitación “Dr. Vicente Arroyabe”, founded the Covering 13,000 hectares, the site of the quarries of first seed bank for indigenous trees of Northwestern the cement plant in Puesto Viejo in the north of the Argentina. Since then, the seeds are collected, studied, country is one of the largest in the Group. However, treated, and stored – strictly in accordance with the only a small portion of the quarry is actively mined. guidelines of the UN Food and Agricultural Organiza- Limestone has been quarried in this region since tion (FAO).This ensures that the genetic material of 1970; the cement plant, opened in 1981, is still in oper- the tree population is preserved.The seed bank has, ation today.The first steps toward rehabilitating the moreover, created jobs. Some of them are reserved spent sections of the quarry were initiated shortly for people with physical or mental disabilities:They before the turn of the millennium. In 1999, Minetti collect and process seeds. contacted “Bosque Modelo Jujuy” (BMJ), a non-gov- ernmental organization that focuses on saving the severely stressed dry forests in the region. Extensive cattle ranching, mining, soil erosion and, not least, deforestation have substantially reduced the tree Argentina Rehabilitation at Puesto Viejo,

The nursery of native trees from “Raw material” for the seed bank. Before being stored in the seed bank, Northern Argentina. the seeds are tested.

Inventory of nature A lot of work,a lot of praise To ensure that the result of rehabilitation efforts is The rehabilitation project in Puesto Viejo is unique harmonious with the existing landscape requires in its comprehensiveness. All the material, all the detailed knowledge of this landscape.To this end, in insights, knowledge, and experience can be applied 2006 Minetti asked BMJ to study the flora and fauna to the entire region. In addition, the collaboration in Puesto Viejo.The study revealed an astonishing with local and national organizations guarantees biodiversity. All in all, 587 plant species were identi- that new knowledge and insights will be passed on. fied, including Brazilwood, Humboldt’s willow, and Owing to the complementarities of the individual Quebracho trees.The wildlife count produced, among subprojects, a sustainable modularity is inherent to others, 136 bird, 82 butterfly, and 12 reptile species. the rehabilitation process.The local population also Equally remarkable and pleasing is that the Southern benefits from the concept: New jobs, better soil, and Boa Constrictor lives on the Minetti site.This snake intact surroundings have perceptibly improved the can grow up to three meters in length. As an endan- local inhabitants’ quality of life. Recently, the FAO gered species, it is protected by the Washington paid tribute to these successes:The project in Puesto Agreement on the Protection of Species. Viejo was highlighted as exemplary in the field of sustainable forest management. Supervised rehabilitation After a lot of preparatory work, it was time to develop a specific concept to rehabilitate the disused quarries in Puesto Viejo.The concept had to meet rigorous standards. To ensure that the local gene pool is not diluted, only trees grown exclusively from seeds from the Minetti site may be planted – a condition that can be fulfilled thanks to the seed bank and the tree nursery.To enable the young plants to grow at their own pace, the planning had to include enclosures. Finally, a sophisticated irrigation system had to be installed to prevent erosion or leaching of the soil. Moreover, none of these measures was to impair the company’s operations.To ensure a harmonious juxta- position of rehabilitation and business operations, responsibility for the two was given to the same person: Juan Pablo Ramognino, Mining Development and Planning Expert. Eventually, from 2007 onward, the master plan was put into effect on twelve lots on the company site. BMJ acted as advisor to the company.

66 67 Business Review 3

A dump truck at work.

Group 3 Cement plant Capacity expansion Grinding plant/Cement terminal Aggregates

Participation Cement plant Grinding plant/Cement terminal

6868 Group Region Latin America

Latin American construction sector largely resistant to crisis

Continued economic growth good previous year. Momentum was impacted by a In most countries in Group region Latin America, decline in government spending, fewer remittances the economy continued to grow in 2010. Domestic from abroad and lower receipts of the oil industry. demand in Mexico and Central America, however, remained weak – largely as a consequence of the Consumption of building materials increased in absence of demand from the US; only toward the end Brazil due to lower unemployment, government of the year were signs of a nascent recovery visible. support programs, a rise in lower and middle-class Economic activity in the Andean countries remained incomes, as well as easier access to credit.The stable, while in Ecuador the growth curve leveled government also endeavored to address housing off slightly. Brazil’s economy was extremely buoyant, and infrastructure shortcomings. The construction with Argentina and Chile also achieving robust industry in Argentina grew significantly, driven by growth. the continuation of public infrastructure programs and private investment in industrial and commercial Construction activity still solid in many markets construction. The Chilean construction industry Construction activity grew in Latin America in 2010 also reported good capacity utilization rates, but compared to the previous year, with the exception residential construction suffered delays in the after- of Mexico and Central America, where lower remit- math of February’s earthquake. tances from abroad, less tourism and poor weather affected the economy. This negatively impacted particularly cement volumes and prices.The national infrastructure program in Mexico was trimmed as a result of spending cuts, with the result that public expenditure rose only marginally. Despite better Consolidated key figures access to credit, private housebuilding suffered from Latin America 2010 2009 ±% ±%LFL* a lack of remittances from the US.The construction Production capacity cement industry in El Salvador suffered from delays to gov- in million t 33.4 31.0 +7.7 ernment infrastructure projects and a significant Cement and grinding plants 27 26 drop in remittances from abroad. In Costa Rica and Aggregates plants 25 24 Nicaragua, demand for building materials felt the Ready-mix concrete plants 233 234 lack of government infrastructure programs; private Sales of cement in million t 22.7 22.8 –0.4 –0.4 investors also remained reluctant. Salesofaggregatesinmilliont 12.2 11.8 +3.4 +3.4 Sales of ready-mix concrete In Colombia, private and social housebuilding, as in million m3 10.5 10.1 +4.0 +4.0 well as commercial construction, developed very Net sales in million CHF 3,442 3,348 +2.8 +1.6 well thanks to low interest rates. Additionally, the OperatingEBITDAinmillionCHF 999 1,076 –7.2 –7.5 government also approved many major projects for OperatingEBITDAmarginin% 29.0 32.1 the construction of roads, ports, airports and bridges. Personnel 12,710 12,626 +0.7 +0.6 Many of these are already in the execution phase. * Like-for-like, i.e. factoring out changes in the scope of consolidation and currency In Ecuador, construction activity leveled off after a translation effects.

68 69 Business Review

Shipments of building materials stable in overall terms stoppage at the Manas plant, ordered by the authori- Domestic cement shipments fell at Holcim Apasco in ties, resulted in a decline in shipments of aggregates Mexico, although by less than the market as a whole. in the Greater Bogotá area. However, deliveries of Due to infrastructure projects in the transportation ready-mix concrete matched the previous year’s and utilities sectors, shipments of aggregates and level. Holcim Ecuador experienced a slight drop in ready-mix concrete rose. The main destinations volumes of cement and in particular aggregates, were road, bridge and dam projects, as well as LNG while shipments of ready-mix concrete remained in Manzanillo. stable.

The commissioning of the new Hermosillo plant Cement deliveries at Holcim Brazil benefited from in the federal state of Sonora was an important steadily rising demand. The Group company’s market capacity expansion project for Holcim Apasco.The positioning in the metropolises of Rio de Janeiro and plant strengthens the Group company’s position as São Paulo, as well as the entire industrial belt of this a nationwide supplier of building materials and will region, also resulted in significantly higher sales of result in a considerable reduction in logistics costs. aggregates. With this sizable investment, which also factored in sustainability criteria, Holcim Apasco increases At Minetti in Argentina, cement sales were driven its total cement capacity to 12 million tonnes per by rising domestic demand as well as clinker and year. cement exports to neighboring countries.While shipments of aggregates fell short of the previous The decline in activity in the construction industry year’s level, Minetti’s ready-mix concrete operations impacted sales of building materials at Holcim benefited from concrete road building. Cemento El Salvador. The major “El Chaparral” dam project Polpaico in Chile sold significantly more aggregates was temporarily halted and the large “Vacas Falls” and ready-mix concrete. Sales of cement fell slightly, dam project was terminated. Holcim Costa Rica also however, due to new competitors. felt the market-driven decline in demand. Deliveries of cement fell following completion of the “Pirris” Consolidated cement sales in Group region Latin dam.The Group company’s sales of ready-mix con- America fell 0.4 percent to 22.7 million tonnes. Deliv- crete also declined. However, deliveries of concrete eries of aggregates were up 3.4 percent at 12.2 mil- products by the subsidiary Productos de Concreto lion tonnes. Sales of ready-mix concrete increased increased. Deliveries of aggregates were supported 4 percent to 10.5 million cubic meters. by expansion of the Guápiles industrial park, but nevertheless fell in overall terms. In Nicaragua, During the year under review, additional production investment in social housing in the run-up to the capacity at a number of Group companies came on 2011 elections led to higher sales across all segments. stream, or new investment projects were initiated. In addition to Holcim Apasco’s new Hermosillo cement Holcim Colombia sold more cement due to infra- plant in the northwest of Mexico, a third cement mill structure projects and an expansion of grinding was commissioned in Colombia, increasing cement capacity at the Nobsa plant. A temporary production capacity at the Nobsa plant to 2.1 million tonnes. Group Region Latin America

The Group company in Ecuador also has a project Solid outlook ongoing that is aimed at raising production capacity In general, Latin America’s economy is likely to remain by 1.8 million tonnes of cement per year. Responding solid in 2011 and continue to grow. A tendency toward to demand, new capacity was also created for aggre- rising demand for building materials can be expected. gates and ready-mix concrete, especially in Mexico Strong impetus will continue to come from the Brazil- and Chile. ian construction sector. Construction volumes are also expected to rise in Mexico, Argentina and Colombia. Lower operating result The operating EBITDA of Group region Latin America decreased by 7.2 percent to CHF 999 million.The good results from the Brazilian and Argentine Group companies failed to offset the absence of momentum in other markets – most notably Mexico. Internal operating EBITDA development came to –7.5 percent.

Agreement signed with Venezuelan government In September, Holcim signed an agreement with the Bolivarian Republic of Venezuela, in which the parties agreed the terms of Venezuela’s compensation payments in relation to the June 2008 nationalization of Holcim (Venezuela) C.A. At the same time, arbitration proceedings at the International Centre for Settlement of Disputes (ICSID) in Washington D.C. were suspended.The total compensation amounts to USD 650 million, with an initial payment of USD 260 million having been recorded in the fourth quarter. The remaining sum of USD 390 million will be paid in four equal annual installments.

New facilities for preparation of alternative fuels As part of the measures designed to lower CO2 emissions, capacity for processing and storing alternative fuels and raw materials was increased at several plants.The Cartago plant in Costa Rica was able to double the use of such materials thanks to a new shredder unit. At its Malagueño plant, Minetti in Argentina installed two pumping systems for the use of combustible sludge.

70 71 El Gara Forest Project, Morocco lGr,Morocco Gara, El raigafrs rmscratch: from forest a Creating lentv ul rmteEoa at ramn ltomaeco-processed are platform treatment waste Ecoval the from fuels Alternative ntena yFscmn plant. cement Fès by near the in cvli qipdwt ihtc laboratory high-tech a with equipped is Ecoval ots at samples. waste test to Morocco El Gara Forest Project,

The M’Goun Geopark has More than 334 bird species are listed in a scientific guidebook. An ornithology organization observed birds a unique landscape. in their natural environment for five years.

72 73 El Gara Forest Project, Morocco hsapoc a nbe ocmt raeafrs in forest a create to Holcim enabled has approach This iacal omiti h 7,200-square-kilometer the maintain to financially nae fhg itrc elgc n utrlsignifi- cultural and geologic, historic, high of area an a as only not seen be to wants Holcim development Morocco, In sustainable of record track good A north- the in climate country Mediterranean a a is contrasts: Africa, of of tip northwestern the at Morocco, scratch. from seemingly – Gara El environment. the of for stewardship its support and its both communities through local – for decades Morocco three in than more sustainability practicing been has Holcim ’onGoaki h is fteAlsMutis– Mountains Atlas the of midst the in Geopark M’Goun steadily the with pace keeps products concrete and ac htofr aubehbttfrarc diversity rich a for habitat valuable a offers that cance the in siroccos hot searingly and country the of west iigdmn nti mrigmarket. emerging this in demand rising edn rvdro uligmtras–btas as also but – materials building of provider leading fpatadaia wildlife. animal and plant of Mountains Atlas the of flank northern the On south. epnil opn ntefedo sustainability. of field the in company responsible a mhsshsbe lcdo h rtcino birds. of protection the on placed been has Emphasis pour “Association the joined Morocco Holcim 2000, In itci n uie re luih hl nthe on while flourish, trees juniper and pistachio n20,Hli,i oprto ihte“Administra- the with cooperation in Holcim, 2002, In Maroc”. du Géologique Patrimoine du Protection la te ieton uhsaddt am rw Holcim grow. palms date and bushes thorny side other indsEu tFrt”adte“soito Tazekka”, “Association the and Forêts” et Eaux des tion hog t ebrhpHli sit h associati the assists Holcim membership its Through a enatv nti lmtclydvrecountry diverse climatically this in active been has ic 98 oa,mr hn50epoeswr to work employees 500 than more Today, 1978. since nueta h company’ the that ensure vrbe ulse nMorocco. in published has been that ever first guidebook the scientific is birds Maroc” du Oiseaux “Les upto eet stone, cement, of output s on LsOsaxd ao”hsbe elzdi atesi ihthe with partnership in realized been has Maroc” du Oiseaux “Les rihlg ru fCnrlMorocco. Central of Group Ornithology wre rz yteEvrnetMnsr of Ministry Environment the by prize a awarded snwciial nagrd ic h rga was program the Since endangered. critically now is ntenab eetpat stewsemtrasre- materials waste the As plant. cement nearby the in naohrcnrbto ossanblt nMorocco, in sustainability to contribution another forestation In by complemented disposal waste Modern Morocco. anhd 6Bl bshv enscesul asdat raised successfully been have Ibis Bald 26 launched, lc oslfes hscnevsrsucsada the at and resources conserves this fuels, fossil place h reigadrsac tto erMezguitem. near station research and breeding the cvl ru opn,ivse 5mlindirhams million 45 invested company, Group a Ecoval, aetm nue h niomnal responsible environmentally the ensures time same ocmMrcoas ntae atesi with partnership a initiated also Morocco Holcim oeta iemlinSisfac ntecon- the in – francs Swiss million five than more – ipslo waste. of disposal h Gop ’rihlged ao eta” With Central”. Maroc du d’Ornithologie “Groupe the tuto fawsetetetpafr nE Gara. El in platform treatment waste a of struction nMrco hsoeaini nqe h platform The unique: is operation this Morocco, In ocmsspot rihlgsssetfv years five spent ornithologists support, Holcim’s anhdapormt eetbihteNorthern the re-establish to program a launched nue h rprsprto n ipslo waste. of disposal and separation proper the ensures bevn,cutn,adctlgn h id of birds the cataloging and counting, observing, adIbis, Bald hr prpit,wast appropriate, Where ooc.I 07 hypbihdterrslsin results their published they 2007, In Morocco. ieyacamdsc acclaimed widely a hc a nefudaloe ooc and Morocco over all found once was which etfcgieokta was that guidebook ientific aeil r co-processed are materials e Morocco El Gara Forest Project,

In Holcim Morocco, sustainable develop- The reforestation will enable the development of forest grazing. Forest grazing enhances ment is part of its business strategy. residents’ quality of life.

Shortly after opening the waste treatment platform, From all,for all Holcim took another step toward greater sustainabil- As it does everywhere else in the world,in Morocco ity: It began to reforest an area covering 200 hectares Holcim attaches great importance to social as well as in the vicinity of the Ecoval plant. Reforestation fulfills ecological responsibility. Consequently, the inhabi- several objectives simultaneously: On the one hand, tants of the surrounding communities are responsible it is intended as a contribution to the Moroccan for maintaining the new forest. However, the popula- “Programme Forestier National (PFN)”.The PFN is a tion of El Gara had already taken responsibility for the 20-year plan that includes ecological and social project at an earlier stage:They were the people who projects, among other things, to protect the soil, to planted the saplings.Thus, they have been integrated combat further desertification, to advance controlled in the project from the outset,giving them a sense of forestry, and, not least, to protect biodiversity. responsibility for “their” forest.

On the other hand,the forest is intended to help to It takes eight years for the young plants to develop compensate for CO2 emissions:The goal is 51,000 into trees.Until then the soil and the saplings must tonnes of CO2 over 40 years.Over and above this,an be carefully tended.Thought is already being given to intact, flourishing forest offers many other advan- follow-up projects.These could include educational tages. It provides a habitat for numerous species and nature trails, ornithological programs, and even of flora and fauna. Moreover, as a self-contained beekeeping in and around the new forest in El Gara. ecosystem, it makes a fundamental contribution to The aspirations of Holcim extend well beyond the site: protecting biodiversity. In addition, it offers the local that the forestation project will prove to be the seed population opportunities for work and recreation. of a movement that other companies will join in time.

Four steps to success The project was broken down into four phases.In the first phase,over the course of six months,200,000 young plants were cultivated in a tree nursery especially established for this purpose: red eucalyptus, tuart,and carob. In the second phase, these saplings were planted.This was followed by a labor-intensive thinning out process to optimize the forest density. The fourth phase is maintenance,which in the case of artificially created forests has to be guaranteed over the long term to protect the new ecosystem against diseases and the forces of nature.

74 75 Business Review 4 4 The forest will have 200 hectares of eucalyptus.

Group Cement plant Capacity expansion Grinding plant/Cement terminal Aggregates

Participation Cement plant Grinding plant/Cement terminal Aggregates Middle East Group Region Africa

Stable demand for building materials in Africa Middle East

Economy remained on a growth path Decline in operating result The construction sector developed positively in most Group region Africa Middle East’s operating EBITDA parts of Group region Africa Middle East. In Morocco, declined by 3.8 percent to CHF 359 million,especially infrastructure and private projects supported demand, due to Morocco. Internal operating EBITDA growth which declined in other areas. Lebanon saw heavy was 5.4 percent. investment, although the pace of growth slowed in the fourth quarter. Presidential elections gave an Predominantly subdued development impetus to the construction industry in the West The market environment in Group region Africa African markets,and in the Indian Ocean region con- Middle East is expected to be largely subdued in 2011. struction activity remained robust. Construction of social housing in Morocco is expected to gain momentum only in the second half of the Demand for building materials was mostly solid year, and activity in the Lebanese construction sector Cement sales at Holcim Morocco declined due to lower appears to have peaked in 2010.There will be no market momentum and increasing competition due upturn in construction activity on La Réunion, but to additional capacity. Sales were also impacted by Madagascar is expected to develop positively. Holcim road closures caused by bad weather conditions in expects a slight decline only in the cement segment the Casablanca region. Sales of aggregates benefited in this Group region,particularly due to the political from the expansion of the Rabat–Casablanca highway, uncertainties in the West African markets. and by the commissioning of a new quarry in Skhirat. Volumes of ready-mix concrete were supported by considerable deliveries for a new water treatment plant near Fès,but showed a decline overall. Doubling clinker capacity at the Fès plant progressed according Consolidated key figures to schedule. Holcim Lebanon recorded a significant in- Africa Middle East 2010 2009 ±% ±%LFL* crease in deliveries of cement and ready-mix concrete. Production capacity cement The Indian Ocean operations remained stable in terms in million t 11.2 11.2 0.0 of cement, but aggregates and ready-mix concrete Cement and grinding plants 13 13 sales declined due to the lack of large infrastructure Aggregates plants 55 projects.The operations managed by Holcim Trading in Ready-mix concrete plants 25 25 West Africa and the Arabian Gulf increased their sales Sales of cement in million t 8.9 8.8 +1.1 +4.5 of cement. National Cement in Abu Dhabi established Sales of aggregates in million t 2.5 2.6 –3.8 –3.8 itself as the biggest grinding station in the Emirates. Sales of ready-mix concrete in million m3 1.1 1.1 0.0 0.0 Cement deliveries increased by 1.1 percent to 8.9 mil- Net sales in million CHF 1,098 1,206 –9.0 +2.5 lion tonnes. Shipments of aggregates fell by 3.8 percent OperatingEBITDAinmillionCHF 359 373 –3.8 +5.4 to 2.5 million tonnes.Mainly as a result of the weak OperatingEBITDAmarginin% 32.7 30.9 market on La Réunion, sales of ready-mix concrete Personnel 2,213 2,256 –1.9 –1.9 remained at 1.1 million cubic meters. * Like-for-like, i.e. factoring out changes in the scope of consolidation and currency translation effects.

76 77 Lugait Plant, Philippines

The entrance to the public butterfly garden. At this site, these butterfly species can be found everywhere. In the early morning,an employee checks if the eggs have developed into larvae.

Flashes of color at the cement plant: Butterfly garden at Lugait, Philippines Lugait Plant, Philippines

The Social Development and Manage- Lemon juice is the basis for the “Kalamansi”, The “Kalamansi” drink is “Kalamansi” satisfies the thirst. ment Program (SDMP) is done in a local specialty. produced in a social project. partnership with the regulatory bodies.

78 79 Lugait Plant, Philippines utrl adna h uatcmn ln brightens plant cement Lugait the at garden butterfly A h al routine. daily the iemargin. wide ipybatfl ocmpoe hsi h Philippines: the in this proves Holcim beautiful. simply oia otrn sepaie yteitgainof integration the by emphasized is footprint logical ocmhsbe ciei h hlpie ic 1974. since Philippines the in active been has Holcim tradition cement of years 30 Over all it of middle the in and – noise level background significant of a machines, huge buildings, Factory be also can it but – survival for essential is Biodiversity papaya. a picked boy happy A utial rcie noordiyoeain” says operations”, daily our into practices sustainable oa,Hli stelretcmn opn on company cement largest the is Holcim Today, rgtyclrd rgl-okn utrle.Wa at What butterflies. fragile-looking colored, brightly uisBlo,woersosblte nld mining include responsibilities whose Baliog, Julius h rhplg,oeaigfu lnsstrategically plants four operating archipelago, the nrist euetecnupino oslfuels. fossil of consumption the reduce to energies to, rise given has attitude This plant. Lugait the at is lnesesoto yci elt ttecement the at reality is sync of out seems glance first mn te hns h ocp fuigalternative using of concept the things, other among hsi euae yacniuu msin monitor- emissions continuous a by regulated is This oae costecutyadepoigaround employing and country the across located n ytmta eiista ocmcmle with complies Holcim that verifies that system ing h eurmnso h Philippi the of requirements the ln nLgi nMsmsOina rvnei the in province Oriental Misamis in Lugait in plant ,0 mlye.Cmn rdcini eore and resource- is production Cement employees. 1,700 nryitnie ec,esrn htteproduction the that ensuring Hence, energy-intensive. hlpie.Hr,Hli a ucee ncetn a creating in succeeded has Holcim Here, Philippines. auea itea osbei sipratats sit as task a important as is possible and as man little as impacts nature material building essential this of scalnig Orcmimn ored to commitment “Our challenging. is ecflosso idvriyai h ceaseless the amid biodiversity of oasis peaceful utigatvt:abtefygre n o only not and – garden butterfly a activity: bustling that. eCenArAtb a by Act Air Clean ne c u eco- our uce ietee oa,awd ait fbtefiscnbe can butterflies of variety wide a Today, there. live aino lns nti a,te epu enhancing us help they way, this In plants. of nation ut ifrn oto oioigsse a inau- was system monitoring of sort different a Quite eco-control living A oee,tebtefygre nLgi smr than more is Lugait in garden butterfly the However, responsibility over Handing ena h plant. the at seen idvriyi h ra”Teie fabtefybiotope butterfly a of idea The area.” the in biodiversity ntecmayst rs ntecus fnumerous of course the in arose site company the on uae ntepeie ftefcoyi uatin Lugait in factory the of premises the on gurated rsiiu betfrso n lomr hnjust than more also and show for object prestigious a etme 07 utrl adn oez Pendang, Lorenzo garden. butterfly a 2007: September icsin ihlclatoiis u twsalong a was it But authorities. local with discussions iePeietfroeain tteLgi ln,ex- plant, Lugait the at operations for President Vice ro htbsns n idvriycnfors in flourish can biodiversity and business that proof lis Btefisaea niao ftesau of status the of indicator an are “Butterflies plains: odfo dat elzto.Frt twsnecessary was it First, realization. to idea from road h aepae W att nld h community the include to want “We place. same the h niomn.Orbtefygre a eoea become has garden butterfly Our environment. the n hwte o aigcr fntr a benefit can nature of care taking how them show and ocos h ih lns ttms utrle are butterflies times, At plants. right the choose to acur n reiggon o aybutterfly many for ground breeding and sanctuary eypcyaotternuihet hc prompted which nourishment, their about picky very epe,epan uisBlo.Ti sterao why reason the is This Baliog. Julius explains people”, pce.Btefispa nipratrl ntepo the in role important an play Butterflies species. ocmiiitda codwt h omnt and community the with accord an initiated Holcim h xet odsg h adnsfoaexclusively flora garden’s the design to experts the o rudteneso h utrle htwo that butterflies the of needs the around gnztoso h rvt etrfrtesupervision the for sector private the of rganizations lc hr h amr a aearest. a take can farmers the where place A l later uld lli- Lugait Plant, Philippines

The tree nursery at the Lugait plant. A worker of the tree nursery delivering seedlings. The organic vegetables are served in the nearby canteen.

of the garden. Holcim also organized workshops to The butterfly garden and its brightly colored fluttering train various members of regulatory bodies from dif- activity serve as an accessible recreational area for ferent regions.Topics included butterfly breeding and Holcim’s employees and the inhabitants in the vicinity. how to integrate the processing of dead butterflies In addition, the company organizes courses and into arts and crafts,for example,in picture frames or lectures for school and college students from the as bookmarks.Training also includes how to market surrounding towns, cities, and provinces.The local such souvenirs. In this way, underprivileged families tourist office wants to include the entire Lugait gain access to an additional vital source of income. plant in its official tourist program – as a compelling example of how to link economy and ecology. Widening horizons Holcim also went a“step further”with the garden’s plant life. After the selected flora had established itself and stabilized, the same plants were used in the rehabilitation of the quarries in the area.In this way,it was possible not only to preserve endemic species,but also to establish them in the immediate surroundings of the cement plant.On top of this, more than 60 hectares of land were reforested. About 90 percent of the colonizing plants survived. On the one hand, this is evidence of the quality of the rehabilitation efforts, and on the other, an indication of Holcim’s ecologically responsible approach to cement production at this plant.

Attractive for visitors and locals Since its inauguration, the butterfly garden in Lugait has become an attraction for eco-tourists. Meanwhile, everyday life is brightened not only by the iridescence of the butterflies,but also by the blooms of an orchi- darium, and the complex now includes an herb garden as well.

80 81 Business Review 5

The Lugait cement plant at night.

Group Cement plant Capacity expansion Grinding plant/Cement terminal Capacity expansion Aggregates

Participation Cement plant Capacity expansion Grinding plant/Cement terminal Group Region Asia Pacific

Building activity solid in Asia Pacific

Strong economic growth in nearly all markets Despite unfavorable weather, the construction sector The economic areas in Group region Asia Pacific in the Philippines grew more strongly than expected developed consistently and positively. High infrastruc- due to the climate of confidence in the new govern- ture expenditure, an attractive investment climate ment and remittances from workers living abroad. and rising consumption boosted the economies In Indonesia, cement consumption increased despite particularly in India,Thailand, Vietnam, Malaysia heavy rainfalls and natural disasters, including the and the Philippines. Also, Indonesia attracted more eruption of the Mount Merapi volcano. foreign investment, and in Australia, the generally friendly Asian economic climate supported demand. The moderate upward trend in Australia tapered off However, the heavy rainfall and flooding in the east slightly in the second half. In addition, construction of Australia dampened the otherwise positive picture activity in many areas came to a halt shortly before in the fourth quarter. New Zealand emerged from the end of the year and then especially in the new recession and returned to a modest rate of growth. year due to the devastating floods in the eastern part of the continent. Furthermore, rising interest rates Higher demand for building materials adversely affected investment in housebuilding. Cement consumption remained at a high level in India. New Zealand’s slight economic recovery has not Activity in the construction sector was supported by yet had an effect on the construction sector. investments in infrastructure and pent-up demand for new homes,as well as by growing demand in the commercial and industrial sectors. Consumption of cement reached double-digit growth rates in the first half, before slowing slightly in the second half due ConsolidatedkeyfiguresAsiaPacific 2010 2009 ±% ±%LFL* to the monsoon.The construction sector in Sri Lanka Production capacity cement and Bangladesh also saw strong growth, driven by in million t 93.7 90.7 +3.3 government infrastructure and residential building Cement and grinding plants 58 57 projects. Aggregates plants 86 85 Ready-mix concrete plants 403 402 In Thailand, private housebuilding showed an excep- Sales of cement in million t 71.4 67.3 +6.1 +3.6 tionally sharp increase. The Vietnamese government Sales of mineral components invested in energy supply, ports and bridges. Growth in million t 1.0 0.7 +42.9 –9.5 in the demand for cement in Malaysia slowed due Salesofaggregatesinmilliont 26.4 10.4 +153.8 –2.9 to delays in implementing government stimulus Sales of ready-mix concrete programs. in million m3 12.7 8.1 +56.8 +7.4 Net sales in million CHF 7,958 6,418 +24.0 +1.6 OperatingEBITDAinmillionCHF 1,820 1,760 +3.4 –10.8 OperatingEBITDAmarginin% 22.9 27.4 Personnel 38,172 36,858 +3.6 +3.4

* Like-for-like, i.e. factoring out changes in the scope of consolidation and currency translation effects.

82 83 Business Review n nHmca rds n ta rds new Pradesh Uttar and Pradesh Himachal in and and Pradesh Himachal In growth. export good also but evcn,peodtosfricesdcompetitiveness of increased terms for in preconditions servicing, particularly needs, customer on focus hatsah w e inlnswr commissioned, were lines kiln new two Chhattisgarh, shipments, domestic above-average in only not resulted rdcincpct osqetyicesdb 36.1 by increased consequently capacity production h xaso fcpct tAbj eet nIndia in Cements Ambuja at capacity of expansion The segments all in sales Higher ntegoigIda aktwr set. were market Indian growing the in greater and companies Group both in expansions With rnigsain eto tem h ru company’s Group The stream. on went stations grinding C utmngdto managed just ACC clinker. of tonnes million 16.4 to percent ntetidqatr C omsindteexpanded the commissioned ACC quarter, third the In h otes ftecutytruhisinvolvement its through in country market the the of of northeast share the major a secured Lanka Holcim esb rnprainbtlncsadespecially and bottlenecks mar- transportation several by in kets affected heavily was company Group inln tisWd ln.U o1,0 onsof tonnes 12,500 to Up plant. Wadi its at 2 line kiln des ete odtos nadto,tecommis- the addition, In conditions. weather adverse inn fnwpouto aaiywsdlyd In delayed. was capacity production new of sioning lne a o epoue hr nadiybasis, daily a on there produced be now can clinker eun hpet fraymxcnrt hc are which – concrete ready-mix of shipments return, ocnrtdi ra etr oea double-digit a at rose – centers urban in concentrated aigtepatoeo h ol’ igs produc- biggest world’s the of one plant the making ae C upidsgiiatifatutr projects, infrastructure significant supplied ACC rate. inlns lo h w e rnigsain in stations grinding new two the Also, lines. tion ntefut ure,tecmisoigo h new the of commissioning the quarter, fourth the In nldn h xaso fKlaaarotadthe and airport Kolkata of expansion the including omsindmr hn33mlintne fnew of tonnes million 3.3 than more commissioned plant. this of out supplied being now are Karnataka inln tteCad ln tre.I oa,ACC total, In started. plant Chanda the at line kiln osrcino h M the of construction clinke aaiydrn 2010. during capacity r anancmn ae.The sales. cement maintain ma metro. umbai eetdlse rmtesokexchange. stock the from delisted Cement rcsfrtecntuto frasadhigh-rise and roads of construction the for tracts ntePiipns ocmicesdsimnsof shipments increased Holcim Philippines, the In h xaso fpr nrsrcuei h south the in infrastructure port of expansion the eetslsrmie ttepeiu erslevel. year’s previous the at remained sales cement ftecutyad ieHli aasa odmore sold Malaysia, Holcim like and, country the of buildings. ept nes optto,Sa iyCmn in Cement City Siam competition, intense Despite eetdsiecmeiiepesrs However, pressures. competitive despite cement eadfl lgtyi h orhqatro h year, the of quarter fourth the in slightly fell demand okwssatdi eebro h osrcinof construction the on December in started was Work eetadraymxcnrt.I aasa too, Malaysia, In concrete. ready-mix and cement hiadsl oecmn hni h rvosyear. previous the in than cement more sold Thailand nvrosifatutr rjcs n odsignificantly sold and projects, infrastructure various in oecmn.Hli agaehas achieved also Bangladesh Holcim cement. more stegvrmn atal wthdsedn from spending switched partially government the as xot onihoigcutisas increased. also countries neighboring to Exports e eetpati ua,o h aniln of island main the on Tuban, in plant cement new a ae oue eespotdb e ready-mix new by supported were volumes sales obedgtgot ncmn ae tha sales cement in growth double-digit nrsrcuet dcto n efr.A Holcim At welfare. and education to infrastructure grgtsadraymxcnrt ae eeposi- were sales concrete ready-mix and Aggregates noei,vlmso ed-i oceege nthe in grew concrete ready-mix of volumes Indonesia, ntcnlgclydmnigcnrcs deliberately contracts, demanding technologically concentrated on Singapore Holcim facilities. concrete ieyafce ysgiiatcntuto rjcsin projects construction significant by affected tively aa u ocm nsra ntescn afo 2013, of half second the in stream on come to Due Java. h ln ilhv nana aaiyo . million 1.6 of capacity annual an have will plant the eodhl fteya npriua,atrbigheld being after particular, in year the of half second ago.Hli ita ul he e ready-mix new three built Vietnam Holcim Bangkok. cetn oe oueo ed-i concrete. ready-mix of volume lower a accepting aka h tr fteya ydly ninfrastruc- in delays by year the of start the at back oceefclte,adahee eodslsvolumes. sales record achieved and facilities, concrete h ru opn upidi supplied company Group The rmmdya,alpouto ie nSnaoewere Singapore in sites production all mid-year, From tur ntdudrasnl aaeetta,a team, management single a under united rjcs u oadciei xotactivity, export in decline a to Due projects. e pratpoet for projects mportant k ocon- to nks dJurong nd Group Region Asia Pacific

tonnes of cement.The new location is a perfect com- Private placement of Huaxin Cement still pending plement to the existing production and distribution The private placement to increase the share capital network, and will lower logistical costs. of Huaxin Cement – announced in spring 2009 – remains pending and is expected to conclude in the Cement Australia just managed to maintain cement second quarter 2011.The affiliate intends to continue sales in a sluggish market and despite adverse positioning itself favorably in the market and to par- weather conditions toward the year-end in Queens- ticipate in the ongoing consolidation in the cement land. Holcim Australia continued to deal with lower industry. In December 2010, Huaxin Cement acquired aggregates volumes due to delays in major projects all of the shares of Hubei Sanyuan Cement Co Ltd. and strong competitive pricing pressures in the from the Hubei Jinglan Group as well as 70 percent ready-mix concrete business – further exacerbated of the equity of Fangxian Zuanshi.The acquisition by unusually high rainfall followed by the flooding of 80 percent of the equity of Hubei Jinlong is in in Queensland. Holcim New Zealand supplied less progress. These acquisitions will further strengthen cement amid a general decline in activity in the con- Huaxin Cement’s market position in Hubei province. struction sector. Sales of aggregates increased due to an additional quarry in Wellington. September’s Active environmental protection major earthquake had only a marginal effect on the Special efforts on the environmental protection front Group company’s deliveries; the damage to the road and the use of alternative fuels are currently being and rail network is now under repair. undertaken by the two Indian Group companies. Under the Geocycle umbrella brand, all activities in In overall terms, cement sales in Group region Asia relation to the increased use of alternative fuels and Pacific grew by 6.1 percent to 71.4 million tonnes. raw materials will in future be combined and coordi- The sales volume of aggregates rose by 153.8 percent nated on a nationwide basis. In close cooperation to 26.4 million tonnes. Shipments of ready-mix with the relevant authorities, ACC developed guide- concrete increased by 56.8 percent to 12.7 million lines for the use of such materials, which came into cubic meters. force in February 2010.The conditions for granting the necessary license were achieved through advance Increased operating EBITDA test phases at several ACC plants. By the year-end, Despite temporary pricing pressures during the mon- ACC had already used a substantial amount of alter- soon in India and the considerable rise in variable native fuels in the combustion process.The syste- production and distribution costs, operating EBITDA matic recovery of plastic from household waste is a for Group region Asia Pacific increased by 3.4 percent key focal point. In March 2010, ACC also commis- compared with the previous year to CHF 1,820 million. sioned two turbines at a wind turbine farm, each Cost efficiency was further improved in many loca- with a capacity of 1.25 megawatts. Ambuja Cements tions. Ambuja Cements, Holcim Indonesia and Holcim began a wind mill project in Gujarat,with a view to Philippines made a solid contribution to results, as reducing its dependency on the public electricity grid. did the Group companies in Australia, which were consolidated for the full year for the first time. Inter- nal operating EBITDA development was –10.8 percent.

84 85 Business Review aaiyi ni.I utai,tecniun rainfall continuing the Australia, In India. in capacity aisi h is ure f21.I h eodhalf, second the In 2011. of quarter com- first Group the both in of panies results operating negative the a on have impact will flooding devastating the and sawl otnet rwi 01 npriua,the particular, In 2011. in grow to continue will Asia expected growth Further of President the from award environmental coveted prepara- the in invested Cement City Siam Thailand, In xetdfrGoprgo saPacific. Asia region Group for expected countries most in spending infrastructure of step-up Holcim’s Indonesia, In time. first the for Philippines the heat new a addition, In month. per capacity a tonnes has 1,200 plant of The materials. combustible of tion ero prto,icuigtenwsse o shred- for system new the including operation, of year oee,rbidn o nyi utai,btalso but Australia, in only not rebuilding however, nrae ae oue n ihrtroe are turnover higher and volumes sales increased als will industry. Holcim materials building the to impetus siderable the for guidelines to agreed also Philippines The installed. was megawatts 17 of equipment recovery nNwZaad illa ohge ciiy Overall, activity. higher to lead will Zealand, New in ex for accolade by highest success government’s major the a receiving achieved also plant Cilacap n h nrae rvt osbidn ilgv con- give will housebuilding private increased the and igwse rm n oties h resulting The containers. and drums washed ding inlpromnei niomna management. environmental in performance tional eetAsrlasGasoepatntol a the has only not plant Gladstone Australia’s Cement aeilpoue ihqaiyfe,adayresid- any and fuel, high-quality a produces material eyln fatraiefesadrwmaterials. raw and fuels alternative of recycling onr’ igs eetml,bttak oishigh its to thanks but mill, cement biggest country’s hyicuepooigtecmn ina sensible a as kiln cement the promoting include They a ea srcvrdfrrecycling. for recovered is metal ual ee fefcec,i loldi em fenvironmen- of terms in led also it efficiency, of level lentv ntewsedsoa hi.Ti year This chain. disposal waste the in alternative a l ocmPiipnscmn lnsre plants cement Philippines Holcim all saw a rtcin n21,teml compl mill the 2010, In protection. tal eei rmadtoa production additional from benefit o tdisfrtfull first its eted ev the ceive cep- GB_10_Corp_Gov_e_S.87-105:GB_2010 CG_e 8.4.2011 10:58 Uhr Seite 87

Corporate governance

Holcim applies high standards to corporate governance. The goal is to assure the long-term value and success of the company in the interests of various stakeholder groups: customers, shareholders, employees, creditors, suppliers and the communities where we operate.

Acting responsibly Code of Obligations. In the interest of clarity, reference is The ultimate goal of effective corporate governance is made to other parts of the Annual Report or, for example , long-term economic success and strengthening the to our website (www.holcim.com). Pages 91 and 92 of Group’s reputation. This includes continuous improve - this report reflect on the duties of the Audit Committee ment to decision-making processes and management and the Governance, Nomination & Compensation systems through legal, organizational and ethical direc - Committee as well as on the Organizational Rules. tives and terms of reference, as well as measures to enhance transparency. Compliance with internal and Group structure and shareholders external directives, early recognition of business risks, The holding company Holcim Ltd operates under the social responsibility for stakeholder groups and open laws of Switzerland for an indefinite period. Its registered communication on all relevant issues are among the office is in Rapperswil-Jona (Canton of St. Gallen, Switzer - principles of Holcim. Since 2004, the Code of Conduct, land). It has direct and indirect interests in all companies binding for the entire Group, has been part of the mis - listed on pages 196 to 198 of this Annual Report. sion statement. The Group is organized by geographical regions. The Holcim aims to achieve a balanced relationship be - management structure as at December 31, 2010, and tween management and control by keeping the func - changes which occurred in 2010, are described in this tions of Chairman of the Board of Directors and CEO chapter. The current organizational chart is shown on separate. With the exception of Markus Akermann, page 31. CEO of Holcim Ltd, all directors are independent according to the definition of the Swiss Code of Best Holcim has no mutual cross-holdings in any other com - Practice for Corporate Governance. Since the intro - pany. In Holcim, there are neither shareholders’ agree - duction of a uniform type of registered share in 2003, ments nor other agreements regarding voting or holding the principle of “one share, one vote” also applies. of Holcim shares.

The information published in this chapter conforms to the Corporate Governance Directive of the SIX Swiss Exchange (SIX) and the disclosure rules of the Swiss

86 87 GB_10_Corp_Gov_e_S.87-105:GB_2010 CG_e8.4.201110:58UhrSeite88 Corporate Governance n a p n i f i d h T a f n a n i a c r t n i f o n e s f o i B ci p o T G re o M h T l a n o i t i d n o C e h T e r a h S I l a t i p a C I I r P S 0 2 Lt d n a h t fo i r h s a e o t h t r o o n n p m f n n g n i w o l l o o s re a h e s u t h g p u ro a p n a d o i t r t s r t s e v r l l p i c n i e e t i p l l a h c g 01 , /d e C , 1 a h 2 n o e t e h t o o b w o t e h n u o m a t n e m d o 0 0 i e i e A 4 F H r o r r re a h s h s e h a p s a h s e n s i l a n m u r o s o i t a m r e x l a e n 2 2 s e b t r o t v e h t s d n . s d e l i a t e d la t i p a c t b u e c u n a n i r t e c l a r a , 3 v i d n i re u t c u r t s o t s f o l c i t n a l a l , 2 w e n p o 3 , er u t c u r t s s r T m d e e r s e r n e f i c n a e a c e u g e e h o 4 8 q e s /d 5 s e c x a i . ,l a n i m o n C o c r a r o e s o i t f n i t n d s e g a p s t e n 0 l a t i p a c a c a c we i v e i p s t t t c d e t fe s r G r F H n r o r a h s o , 4 u l p a s l a u d i e k n i e r a h s se i n a p m o u f h s i s G n e u a r l a t o i p n f g e t r o b u a o o b a 0 7 u f o d e d a w r f C o r i m d n t f l l 2 i l a t r r fo n i o r a i t c c n I o t f i n p u no i t a m a t c a g i H r c s y t q e r m sr e d l o h e 0 d r o n p u o r o t d n e h o .s e d n a r a l r r t u a p l F e v s t h F H C o m . e v n o s i o p u o r G y a m h t r t f y a la t i p a c r e se i n a p m o c h T f o e i p i t n a l a n i m 2 m r y l l u f p r i u e h t c n o i at m n a v e n c e h T - d i v i d e d m i c l o H o r :s o o i t a ( o e b o o t e d e r a h s r s r r o H m e r a p m l e a p m n i t s 5 6 f s g u s s s t n i t b c e b d e d i l o o i u n n A i t a n e p y n r h s o c r u e s u t a n i - d i a p t a r e c a , ,5 2 7 7 1 , 4 i c g h n o i g e r r e u vl a r i r a p n e s r e d l o h e r e i e r t s n l a p m n o g i i u q c i n g n i a o D y n m r h t r s i g n o d p a h g i g i o f o nt i l t n s t h s t dt L c e s e d e s . l a i t e b f e fo e h t u r t L y l r o A i s t h o t r e t t i sn u c m e e r e h t n i o i t s c a e r o Rp e w r d o i t a u s s m a re a h s f o w s n e w .2 n o r b b 72 7 3 3 , 6 ,8 0 a t s i g e l e e r e l s e i s e t n a s t n e a i d n o r e x y t r e b s s r e n n d t s s e r a h t e h t s s e n i s u b .h e l t i t n a c e y l r e D h t c i r t a s m r i d h s f o /d r o e c n t c u r d e r e f o u o s A :t n i s i c m o n n i d e d i v ,1 3 s l a t i p a c e b m e c r o f a h s s e r a f o r a h s d f o e b s t i o r e t n a t s t s n o i at o f o a h s e r u 1 0 2 r o t a w e h t f o c g i t s n i e r a h s l a n i i s d n u fo l o h e r u o r G i t a n r e b m e c e D , a 6 a s e u s a e o c r a l i m s r e v n t n i we i rv e , .) 0 n ra r l l n a t e s m dre e t s i g re g n i d r o c f o i r c s b e b d n t r e v n h c p o o m a 3 o i t u t l a n o m i x a u o r h o e h T 5 1 9 1 sr e d p ,1 y n a p m mi c l o H s a w s t t u o n o 3 h t ,n e s w t o c no i e d )s ( e g a P 1 0 2 c e j b u ta h t 4 6 25 7 o el b i t a e b h t i tn u e no c – – , m hg la n eh t dn mu tb ni 9 1 9 1 1 2 5 1 – 0, ,1 3 - 8 - 2 8 8 7 6 t C C A ci p o T A d e z i r o h t u A W R R K D o t A w F r w c i w n w e i v e a o h t r u f g i e y e h t r d o s t i d d e a d l u o h w. w l r a i d n g h t h s g n a t t a a r r i h o n i a c l u e d a r t e l e a s e l t a i m e c e D r e t a a n o i t o r s t n l a n o r t n s e s A , e p e v i g f d e c i c l o a n o i l c i t r o s i s C r o f n n i o i p f t r / f i t r s n a n a n o e O r e n I c d n f i a m d n fo n i l e r a h s t i u q e o r e v n o p s e a c o o c r e b u d s e t a c i e s i i n r s o c . i t a m t w w w w w n a m a h o n o i l p p a l a t i p n p r f n I o i t a m r tc . w w . w w . w w . w w . w w t /o c m sn o t g f 3 r er i m y o i s r r o t s e t a c i f i t r e C / l a t i p a c n a ,1 o c n I a m r o i t n o H n i n o A l b a c i c o t a f o e n 2 ; o h o h o h o h o h e v n o s o r h t 01 ,0 h t n o n f t t i n o r o p r c l r e o i t r a p o e i e h p r A c l c l c l c l c l l c r e r e e n o i t n n i A s t h g i r b a e r m c e m i m i m i m i m i r o g e v n o c s i t i s r r n o c A n a o H t i e n s c a h e t a i t f c i u n n o i t a L t i d n o p i c i l e r o o c . c . c . c . c . i e l l c o s r o f t c l t e b f e r d m o m o m o m o m o t d n e y s _ r e h o i s r e a h r I m i i t a t i s n s , r e v o g t a l a n o w r e h t u fo n i n o i c s t h g i f o f o c / o c / o c / o c / o c / e v s n o i o i o o r o h w. w e R o h t u a t L n I 3 f n e h t n I n a d n p n e e b n y d 6 H t r o p o c p r p r p r p r p r w l o a e e c n a n o c r – f o m i c l o c y a m r h g i l e r e r e r a r o a r o a r o a r o a r o 3 a r a e y p a a m i c l o p r p r s , 9 no i t a p i c i t r a p r i t r o 2 0 2 z i d e t a i r e x e l fo t o no e t e t e t e t e t 8 0 0 t o s 1 t a e t a r la e b . t s t u 9 0 n u d 6 8 d t L _ _ _ _ _ n a s w o l , o i o c . g g g g g r A h s i i c u o f o t n o , e d r e v o r e v o r e v o r e v o r e v o n s i , / d n a p s t / m a 1 2 8 1 , a . d e i o g a : t , t . t r A r r n d n , 6 h A e i d r 2 4 59 c e c n a n c n a n c n a n c n a n c n a n . e e r l c q – – n u ,9 . t p a 1 2 1 2 8 1 1 u – .g , 4 d 3 1 9 49 i e t i i b 3 0 5 0 5 6 - d e e e e e y s GB_10_Corp_Gov_e_S.87-105:GB_2010 CG_e 8.4.2011 10:58 Uhr Seite 89

Board of Directors Composition of the Board of Directors The Board of Directors consists of 12 members, 11 of Rolf Soiron Chairman 1 whom are independent according to the definition of Andreas von Planta Deputy Chairman the Swiss Code of Best Practice for Corporate Gover - Markus Akermann Member nance. CEO Markus Akermann is the sole executive Christine Binswanger Member member in the Board of Directors. According to Art. 15 Beat Hess Member of the Articles of Incorporation, all Directors are share - Erich Hunziker Member holders of the company. Peter Küpfer Member 2 Adrian Loader Member Please see pages 98 to 101 for the biographical infor - Thomas Schmidheiny Member mation of the Board members. Wolfgang Schürer Member Dieter Spälti Member Having reached retirement age, H. Onno Ruding Robert F. Spoerry Member resigned from the Board of Directors at the annual 1 Governance, Nomination & Compensation Committee Chairman. 2 Audit Committee Chairman. general meeting of shareholders 2010. He had been a member of this body since 2004. The Board of Direc - tors has expressed sincere gratitude for his service. Election and terms of office of the Board of Directors The members of the Board of Directors are each The shareholders elected Beat Hess to the Board of elected individually and for a three-year term of office. Directors. He holds a doctorate in law and is admitted Elections are staggered such that every year approxi - to the bar. Until the end of 2010, Beat Hess was Legal mately one-third of the Board of Directors stands for Director and member of the Executive Committee of election. Members of the Board of Directors may be Royal Dutch Shell Group, The Hague. proposed for re-election by the Board of Directors upon motion by the Governance, Nomination & Com - New members of the Board of Directors are intro - pensation Committee. The Governance, Nomination & duced in detail to the company’s areas of business. Compensation Committee bases its motion on a re - view of the overall performance of each candidate. The Board of Directors meets as often as business After four three-year terms, the review includes the requires, but at least four times each year. In 2010, question as to why a further tenure as a member of five regular meetings, four private meetings without the Board of Directors is deemed to be in the best the presence of the Executive Committee, and one interest of the company. strategy meeting were held. The Board of Directors held four regular meetings with all members present Members of the Board of Directors shall retire regard - and one meeting with one member excused. As a rule, less of a current term of office at the first general the members of the Executive Committee attended meeting of shareholders following their seventieth the regular meetings of the Board as guests, insofar birthday. as they themselves were not affected by the items on the agenda. The average duration of each meeting was 3.7 hours.

88 89 GB_10_Corp_Gov_e_S.87-105:GB_2010 CG_e8.4.201110:58UhrSeite90 Corporate Governance * R e t e i D o W h T A e P r E a e B h C A R o B r e h t O i L e b o l o i r d r d n h c i r e t d e t s m o r a r f f l n i t s i t n a S d a g a e t r e H r u H i o K s a r o j a m c o S e f p ü a p m o s F d a o L g n no r f ss l ä p e . z n S n o v r i D S B m h c c S o p re k i i it a w s n r .y n re e s s i w S ü h P e sr o t c h d i a l yr r re r n n e at re g d n a n i y n g i e r o f i R a L M S E G . F S S e G C S S S a G M J e G C N o N S S n o L e L H S M u c s s i w o c e p c e p c I o h e e X e t e e e a i l a g h H n a h w h e w h o n n u e b n r z r é l t s v e l t t r t a d n u M e w e a z a d c c i w S a m f f o z z i a g r a n e l g o r t r t s , f o v r i r e n o f l C e r i D e a W t i e R B u u n u o r G i H i i e t t l o T - r , G A s e t a d n a m S s i z et e z z a t s s ä m m r e P a & H y e s i r e , G A l o e . l r o h c . A r h k r n A i r i r l o H E n g n i d c p u o r G e d a l o H a V a V e c n a r u s , , G h c s e h c s B ü D , d x r o t n n i d p e a m r i d l o & n I e h c e v e V a a R e g n a h c o d - u l u l , n o r u e M , d t L k n M L *l e s a B c l e s s i d e P e a . l a y o R g e p p e e , , G A n e r t n o c g n e t n I V - l a n o i t a N e C e C c o R n a S c o c a A , G A y g i t u e e g a n a M e g a n a M . d t L f o B *f r o d * G l i w s r , G A e m e m l e s a , G A m o C e t n i W i t a n r e h e h t , , G A i c n a r F S c h c t u D , , k * l a hc i r u Z l a i r t s u d n I - t n , t f a h c s l l e s e g n e i t k A - e i r t s u d n I - t n *a f ä t Z le s a B u Z A * u L n o d n o L i r u n o J - d r a o B p . o C , G hc i r u Z o m m , y n a c i r e t *r u h t r l a n *h c r e oc s * l e s a B n e n e l l e h S c a b r *a *h , . d t L c i s t t , . c n I *h c i r u Z f o , . d t L , . d t L e h *h T e s r o t c e r i D , p u o r G u r *o y k o c s l l e s e g n e i t k A - e s n e f i e r G n o J - l i w s r e p p a R n o J - l i w s r e p p a R g n s - G T e h e e d i s t u o e s *e *e u g a H s l l h c , t f a h f a e h t a a t , B m i c l o H e p p a R an o J - l i w s r e p p a R s a l e * an o J - l i w s r p u o r G s a t a re b m e c e D a m r i a h C r e b m e M r e b m e M r e b m e M a m r i a h C e M e M v d A e M S r e b m e M r o i n e S e M e M e M e M a m r i a h C a m r i a h C a m r i a h C no i t i s o P C e M C e M e M e M e M r e b m e M e M w r i a h r i a h i e b m e b m e b m e b m e b m e b m e b m e b m e b m e b m e b m e b m e b m s s i o s n a m n a m e R r re n t r a P y r r r r r r r r r r r r r n n n n n f o f o f o f o f o f o f o f o f o f o f o f o f o f o f o f o f o f o B i v d A , 1 3 a o f o f o o o f o f o f o e h t e h t e h t e h t e h t e h t e h t e h t e h t e h t e h t e h t e h t e h t e h t e h t e h t e h t f f 01 0 2 dr e h t e h t e h t e h t e h t e h t e h t y r o s o B o B o B o B o B o B d r a o B i t u c e x E y r o s i v d A o B o B o B S o B o B i t u c e x E I e t n p u d r a o B d r a o B B B d r a o B y r o t a l u g e R d r a o B d r a dr a dr a dr a d r a dr a d r a d r a d r a dr a dr a l e n a P o o r o s i v r e d r a d r a la n o i t a n r e v e v f o B ee t t i m m o C ee t t i m m o C dr a o D y sr o t c e r i dr a o B dr a o B GB_10_Corp_Gov_e_S.87-105:GB_2010 CG_e 8.4.2011 10:58 Uhr Seite 91

Since 2002, the following expert committees have Governance, Nomination & Compensation Committee been operational: The Governance, Nomination & Compensation Com - mittee supports the Board of Directors in planning Audit Committee and preparing succession at the senior management The Audit Committee assists and advises the Board level. It monitors developments with regard to com - of Directors in conducting its supervisory duties with pensation for the Board of Directors and senior man - respect to the internal control systems. It examines agement, and briefs the Board of Directors accordingly. the reporting for the attention of the Board of Direc - The committee decides on the compensation paid to tors and evaluates the Group’s external and internal the Executive Committee, and on the CEO’s targets audit procedures, reviews the risk management sys - and performance assessment, and informs the Board tems of the Group and assesses financing issues. of Directors as a whole of the decisions taken.

Composition of the Audit Committee Composition Peter Küpfer Chairman of the Governance, Nomination & Compensation Committee Andreas von Planta Member Rolf Soiron Chairman Dieter Spälti 1 Member Erich Hunziker Member Thomas Schmidheiny Member 1 Since May 6, 2010; H. Onno Ruding until May 6, 2010. Wolfgang Schürer Member All members are independent according to the defini - tion of the Swiss Code of Best Practice for Corporate The Governance, Nomination & Compensation Com - Governance, in order to ensure the necessary degree mittee held three regular meetings in 2010. All except of objectivity required for an Audit Committee. for one of the meetings were attended by all members of the committee. The meetings were also attended In 2010, four regular meetings of the Audit Committee by the CEO as a guest, insofar as he was not himself were held. Except for one, all of the meetings were affected by the items on the agenda. The average attended by all members of the committee. Three duration of each meeting was 3.8 hours. meetings were also attended by the auditors, and at three meetings, the Head of Group Internal Audit was The Charter of the Governance, Nomination & Compen - present for certain agenda topics. Furthermore, the sation Committee may be found at www.holcim.com/ Chairman of the Board of Directors (except for one corporate_governance. More details on the activities meeting), the CEO and the CFO attended the meetings of the Governance, Nomination & Compensation of the Audit Committee as guests. The average dura - Committee, in particular with regard to the process tion of each meeting was 3.7 hours. of determination of compensation, can be found in the remuneration report, starting on page 106. In 2010, the committee has particularly taken note of the status of the ICS (internal control system), Areas of responsibility dealt with internal directives and evaluated financing The division of responsibilities between the Board issues. The Audit Committee’s Charter is available at of Directors and the Executive Committee is set out www.holcim.com/corporate_governance. in detail in the company’s Organizational Rules. The Organizational Rules may be found on our website at www.holcim.com/corporate_governance.

90 91 GB_10_Corp_Gov_e_S.87-105:GB_2010 CG_e8.4.201110:58UhrSeite92 Corporate Governance e r o C u a t a l f o h T l a n o i t a z i n a g r O h T e r b f o r i D o t 2 a t i t n a r i D i t r O a t r i D E C o r p o t h t h t f e m x e x e s A u A h t h T r t s i s n a i t rat a m h T h T f o o 0 e e v s e s e n o o p s i u q s k s s k s r s r r, e e e e p e t n a g d e e h t e e e 2 0 O. t d A p r t e a t i d e d e w e i rv e p c e c e c e a d n a n v e h p s e h , u s g e t x e u q a e y r f o o b g r O Ee x a r O o B Ex m u n h t n r e d i s e i g e rat t s v e r a r o t t r r o o t t I , o t o t o t e r r s n e h n a a d n . m e g e n a C h c z i c t o B c e c e a l a n a g 7 i d t t a r a d n d n y t i i c t c . d y, p e r r r r, o m o e h t e h t e i u c e h 6 1 t r f o l b i t a o i n a f m o s s s o d .s e B m l a r o t u h t e d rd a a e b w e a s w T ; r r e o a s i o i t s n o i b a o o p c v i t i d u e l n a g n e e r p p i z i u f c c a u F z i e h C o i m a p i h n f m o e v i e s t t i m t e a r y l e h T n o n f i t c fo a h s a i t a d a o H e h a d r n e w e e v t r f o n n i w Ex h t , t h c f o c n f l a y t o ’y n D e t t o i t o t o n t o v o c e t t h t r z i Co t e p .s k h t e h o C o r i p o – e w t n n o r i t s a e l u c e i d r se l u R e c l o h t s r o t c r e i D e y a u l e o i t R m s r s r f i t a n i m o i p e r n a m s s e - n a n e ) e t c e n a s f n c e l e l u m i m m r p s e m r e r t t c e a . e o s h t n e A m g n e d i D e r c G Ee x l h t a n r t w S n o l i t s e e l a o h t n o d l u g f o i t r i m n e g r a n o i t e r o o r n a R s u t a i l n i t r o Ru Lt n a e r d n e v c e p n i y r ve a l e b g n i t u c exe l e l u t t i l a t a d s s e p e r e f o s e s i e s n i c u c fe p u s d t t o a M , e o t c t n ,d t s a g l h t e l e f s s g e d n Co s o c e s e l a e e t g s e t r r t b e t e e n i h t a v i t t o o s a t e h r w - s o i i r t r o Co e e h a e – u o o d f l a e h o s d e f s n a f r a n d n m m o t e a r d f o w n e m t e t c u s c a o w t i a n e r e h C s i o c g n i d u l c n i n h t n a t t n s e h d i a l e d A s f t t p l o e l b d r O o B r e r e g ,t h f o Co o E e u s b i r u q c c n I r a h d n n e f n e g r e l r e n f e e h t r i a s e e x s a n o r u a d i e t i I t e e i m s i c f o l a u q n a g n r a n a c d e h s r a ye s d r i m m t d e n o r i d i e e t s e n i e h t s d l e h h t s s n o p o l a u o s i e e r e p e d e h i t u c i n g i s m d e e e h t , u t a t d m t r O r a p e c n a m a l a i c s k s a t e d l o h c n u F u s f o i d t r a o p e e a c vo ,d n a g r O a i d n g n i s s a z i o g i l b d e o t n d a c i f i t s r i f d n a ’y n a p n i n ’r e t at l o p Re o c i t c e r e e t t f d e e v n a c i f e h t a e h t o p t y b e l b i d n a s l a s o p ro p G t n e d n y r o t r i D o n o i t a t s o h - d a e l e r 2 n o n a p m f o n o i t t i w ,n o i t o i t a p u o r f o C f . 1 1 0 y b d n a w s r .n o i n o i t e h t g e c r o a u q h t r o t c e r o c B s e v a e r A i t a z i a n e m e t s r e h t r e v o r fo r e a de d n e m a e c s t i m m t l a o s m s e r h t o b c e n d e s r a e y d r a o s re e h f d a e H w a r o p y e h T B p s e r e x e d a e L t o c n i t e e e h t r o s ’y s s r g d u b o B n i Ru a r e p o o n o .s e i d l a n o i s u b r e t i s n o p d r a o e n d n f o n a s n a M t t i m m o B l l t s e s s t i d r a s e l f o b e n a o i t u c y l o i t u l f o e e t eh t s t si m b u r e t M b i s n o d e t s a uc e x e h t y f o s r d r a p i t s e r i D n o i t a , g ss e n , t e b ce r i D mo c e s i l b a d nw o eh T c e l Ru ( y a A eh t f o ll a h s sr e g a dn a o il i b ht i w sm .s i s a op r o eh t s i a r h t f .s n .t n s se e fo u 2 - c il i - e ,4 1 - - s - la h - 9 - - - , m A d n a T t u a r fo n i D n o rd a o B W t c f T s M W I o b t p c c T r v o s O E C a a c o t t t A f i T f o n o i t a m r o f n I m t n e m r o n o p s e n e d i l a n o i o e h o e h s e e e c n o o o o i s s u r o s i e h d n s h h h f t c e j b f y e l l t c re i m e e g a n a t i t i s i m s s e s e c n o p r t a s n s a c e h t e e e h t h t t t e h t g n i c n a n i f n i t i r o h nt u o n i h n i h h h o c o c C d e m C o B t o d d e m u B y e e r i e d r i i d o r e b t n e m t s ve i OE , o e t a r O E d e n r e t r o d , l a i o s e Rl u e t n n a p m d r a o B n .s e v i o b m e m x E d u A f d r a o i l i b i s e m u c e b i v s r t t s e n i s f m o a s y e s e h e h p u ro G g w f o p ,s r t n e .s r o t c re i D f n u d v i t u c e n n s e i d s a f o t s e n i f e d a r g o e d n ye o b e b e i t r a t u o b a t x o d n a h t i h t e g o f n i a d o b t i m o C f o f e h t o t f r o yt , i e s s e s s l a l l a u s r e b e h t w e m ra re i u q re i d r d n a y e h t o f o y b s n Co e m r o s o i t c a s n ra t s,t i m i l D t f o s a h n i t c e r t a t s i R t o n s e i e h s f o s t o t d n a t s,e i n a p m co f t a m h t t s e v c e r i sr o t c e r i D e i h p t t i m m y m . t r a o B r e nt a t r o p m i ve i t u Ec xe t l o r t n o c e v e r e h f o s r fo o C k n o i o b a e h e h t m i l r i e s i h t C i C a , e e t t d o t l e h t w n o c a M e h T a c o s r o t k r o e r O,E o i t a r e t o e e h t h c a e G m m e h t e d i s a o p r o b a s nt u o m a G h t i d s t i y l n d a t u h c i h w l m v o E e r re a . e e i t c m e g a n p u o r r a f i w u c e x o f r e p f o i d rd a o B s n i l n k a n e d B f e d e r i u q e t a r n r e t E f e h t t t i s t n e m u r t s n i t u g e l e s a e j r o t c i v e h d r a o v e i t u c xe r e b m e m h t n i o e h T o t t e g d u b i D q b u s e t d n a l o v r e t .e e t t i m m Co e e i t s a e u m r o e s nt e m t s vn e i s n o i t c a s n ra t t f o n a m o c e v i t s r r E h t t s e e h h t n i m r t t c e n u F o h c u k s i a e h e x d a t n u j t n e m n o i t s n a f o l l e w B t c e f e c e t n g i s r e t n i p u f o e e n o o d r a o o t o c e r e c n a e n i t u c y r i r o n a p s m m o C s r o t c re i D o p , d n , n o i t c t i D t i n i ,rvo l p a p a m f o N s e o t n o p s o t r i e h e s r u ff o - e n o f s a e r t w o l l o C y l i r t f o s a o t a a i t a u u s s r e w e v i . , t s e e s e h r o f e r a e e t t i m m o a m r e t f e M e i F H C i t c n o h t rvo l p a p a a n i m n i y e h t f o r fo s r o t c f .s l a y r o i r p a m t i m m Co b o s k s a t i l i b i s r i e .n o c e r i D f o y h c i h w e e t t i s r e b m e h t t g n i l a l a n o i v d a d n a n i h t i w a M o t p e h t e h i d o b m e d 0 0 2 e rat o p r co n i a t i t n i s u b l t snt e m t s vn e i e p s e r w o s i r o i f n i e h t d n a n o r p e r g r O y t o t p p a g a n m e m y l r a l u g re r o t n i a m o n n e c .g n i c n a n i f e s e .n o i l l i m d n a r a y b t t o o m se d i c e d t r y n a v a o & rd a o B e r r r no i at n i m o s a e e e r a s e r-e p u s e h t c f e a y m n a a a v n eh t e s i a t a d n i , s r t C A a l t e b s s i i e i s n e i , n i z i s a h s v o n r t l si d n . o . i t c yd o b a b a t e e w e w n o a m r A o i o f e v o e i t l a s o f - - yn o r fo n - - l n i r n r e . n - - - GB_10_Corp_Gov_e_S.87-105:GB_2010 CG_e 8.4.2011 10:58 Uhr Seite 93

mation on all issues relating to the Group and the The BRM process consists of several steps. First, risks company. All Directors may request information from as well as opportunities are assessed and prioritized the CEO through the Chairman of the Board of Direc - according to significance and likelihood. Top risks are tors. At meetings of the Board, any attending mem - analyzed more deeply regarding their causes. In a ber of the Executive Committee has a duty to provide third step, the analysis of the current risk situation information. All members of the Board of Directors is completed with a detailed assessment of the con - have a right to inspect books and files to the extent sequences. Then, decisions are taken on how to deal necessary for the performance of their tasks. with specific risks, on the consolidated risk profile and on mitigating actions. During the year, risks and oppor - 1. Financial reporting tunities are systematically monitored and reported. The Board of Directors is informed on a monthly basis Information gathered in the process is stored in a about the current course of business, adopts the quar - protected, centralized database which allows instant terly reports (with the exception of the report of the access for all Group companies around the world to first quarter of the year, which is to be adopted and re - their information for data evaluation and reporting. leased by the Audit Committee) and releases them for Responsibilities concerning risks are clearly defined. publication. The Board of Directors discusses the Annual The corporate function Strategy & Risk Management Report, takes note of the auditors’ reports and submits is responsible for the BRM process and timely reporting the Annual Report to the general meeting for approval. by the Executive Committee to the Board of Directors.

With regard to Group strategy development, a strat - 3. Internal Audit egy plan, a five-year financial plan and an annual Internal Audit assures the existence and pertinence of budget are submitted to the Board of Directors. process controls and integrity of information. For more details, see page 30. Internal Audit reports to the 2. Business Risk Management Chairman of the Board of Directors and periodically Holcim benefits from several years of experience with informs the Audit Committee. The members of the Business Risk Management (BRM) implemented in Board of Directors have access to Internal Audit at all 1999. The BRM process has been anchored in the times. Each year, the Audit Committee defines the entire Group covering all consolidated Group compa - audit focal areas to be addressed by Internal Audit, and nies and their relevant business segments. the Head of Internal Audit periodically updates the Audit Committee on the activities of Internal Audit. BRM analyzes the Group’s overall risk exposure and supports the strategic decision-making process. Therefore, the BRM process is closely linked with the Group’s strategic management process. The full risk spectrum, from market, operations, finance and legal, to external risk factors of the business environment, is reviewed, including compliance and reputational risks. The risk assessment is not limited to a hazard analysis, but also identifies measures and possible opportunities.

The Group’s risk position is assessed from both top- down and bottom-up. In addition to the Group com - panies, senior management also conducts an annual risk analysis. The Board of Directors analyzes the Group’s risks and opportunities at least once a year and discusses them with the Executive Committee as part of the annual strategy review.

92 93 GB_10_Corp_Gov_e_S.87-105:GB_2010 CG_e8.4.201110:58UhrSeite94 Corporate Governance Ex l p u f s re a J e S r o i n e S m i v h T n a o C f o c o e s u f F h w o S a m h T o C o p a h t n O e H n I h t g A n a i B a M o C n i e l o H a M f o To h T o p u e s l e v m n n a l l s u d u n u l c e t r e c n o i n e m c e u c o i n c n t u a r n i e o d d e r m m r r r g c l p o y e b m c r a n l p J s e s e o B m e o r G e h Ex d a e d y t i l i b i s n o l u o B o f o C o C e t t u e t m i o i t , m m r a h r o r r g e o i t C e b w e b m i d h r r h r t o p o p n i a s a r e g y c e o l s l l l d e r d n a tn e m e g a n a m t i t i v i y l l i t a r a m e m g n d n p r p r 0 2 S a e i , n p u s a n w o L ,1 s r g e t s v o a h g u e e t e e t i s n i s n a r t , 1 a e u t A i d t e d n a n a s i s s b d r o r o h t s e u d 2 r s h w 0 1 e a i t i b e 2 o C C o r e l m e u F 1 0 a U o n i s e r p a o d n E e m e t d n I 1 0 e v b b t a t a a a M e f . e g a e g a i h s . t s f s i r c , t e r a f S a e M i i s m m n i g c i r 0, r e B h t c n c n i c s n e c h w y g h t i l t i l D C e e . t s . 1 n i t e , a n g n h t d e r fo o p C o m e b m e H h s u c a n O E r i a r i a I u F u F f o e e h e m m E t i t m o y y f a h b m e f A e g e e h & n e r e si t c e o i s n f n i r t t t i A y b r t n o t x E n i p s ro G c e f e h t e r e g m d r a n n e x E r, r e h e h t h t o a n e r r p d g n l a n t n g m R o p e s e i d h T i m r t c t c a c i r e e e y s e f C l b n a r o r e b i r t t A s i r f e i t i t o a c y b a n a e o H s p u l s O F e y o i o i s e l c a u c s P o e r e s a e t s e t t T k i t u t f s e v m o r r r e a M g e b . s U n a , 1 n i t r r e i h f e r d e s m o a n a n h t h t o f a M a h r a a m e a w k f o a c l v i t t S w O F C i v o H 2 o f s a e g , e e v p i l e v A e h d , t a M 1 0 r i d a n e m i e m a e r f l l t e c h t i h a r i d s e h n i u h i r p s e o ra e h a n e o H h t a M a M o H d c l r, t E s i n e i p i v n e d n s a C p a 0. m e f f f i t c e g n i n o C x y r i n a h t a n G c e f m i C n i a s m o m o l e e d o c e m e g s e n o p c c e t c e m ro , c l d x E c l I r o i d n p r e , 1 O E a n a n o r e b m e m i e b r n a B e b e i m m y l t r p d r e g n e s i i o g t n u m i d o t u r e r 0 2 L m i t i s r a o t u c e t t i m u p s i h t v i d n e e r e e g e g d t f u s o r e p u s e t n f o a m r d n a n i e i v e f o g n p s e i n a s n o p s a e v i o e h T n o t h c r a M e s e c , 1 1 U s S U f o r o i , t n yr , n o . s r r d p p p u S o t o c r e b .e e t t f o p p a 2 a M S d n a o H e g a n e v i d , e e a o n e B u f e h f o 1 0 f o C e h t , s :w n u d n a O m t s i v i d o s a e h T d a m i t l a n a m a s e r s a h l Ro i m m o d e s i v p l f o o p t r h c r 0 e h t o s r e f f i n a e c n i J t n i o e l b i m i c r i D s i r p A C w l i h n o i t c . e n u r o C f , e m r A 1 0 2 i s n o p i m m o a e r c e x E d n a t c n u f t n e m u s t r c c u s H - t î l l i h t E g g A s k s a t n e e b n o i r o t c e 1 .H a e t s a d n e y l e t s e t n e 5 d e d Lt r o f r e b m n e m e g e d e e c c U a r o p e , a i t b e e t t . 1 , e k a a n a M s i H re t at l ,h c S . S y 0 1 0 2 K Ex ev i t u t a a M a g e r o i s s e s i h T h t dn a K A yt i l i b s n o i a i s A e l h ö a ee t t e h t o C n a ( sa e r a f o fo ,h c o e p u s .s pa i t u c e f o ae r R G H dn e et o r G o s a ae r a re g a n fo d r E C re v - . et - s i d sr e g t n , r, ro f . o pu .) S r O, ev a f - I a d U t o a L i s E b s m i r t n o i t i s o p m Co D e v i t u c e x E P 6 5 4 3 2 R P P T T C o H 1 a I h T n A e B h T r U a M r o f n n n t c e p s e s i h e e U S U U S n i t a w o h h c u f e S e p o r u e s a e l u a t a m o o h s n i o p p f f l o i e o n i r u s r m i c l o n i i l t c e r . e e t t i i i t n i t n i t n n n r c n s a E n i h t i m m e m o a J n i e f f o r d n a i r k r c c l o f o m h T o o F h ö B t c e e e c l l l r e t r a u n c a m n r e t s e u H h p h k n a l C t î f u m n a M J D s n a J i c a p a e m A J M d v i g J k a s a n u a n a a c a l o H y e s s - c e n o c o c d e t s e u o , n o r a t t u n s r e b m e H yl e v i s e o D K h t l i R o r G g c r i t e l a h e o t k A a u m e p A w k b e A K n y r a u h c h ö L g e e e . e x e t n y r a h n o 0 3 H .t hg ee t t i m m o C n e ue m i c ö n u a r o i c o K a c i r y r l e h t t n t l u s i r s d n a r e E y t a b 3 b y , 1 . 1 l a n o i u e l ya r a e y , l . h e e x 1 s e e b c S 1 f o r e 5 2 , 1 5 2 s i o re s 1 o p a m p 1 0 2 N r , , s a r , a n a m a 0 , e m h , t , 1 n b e f 2 3 2 4 h c 2 L 0 2 g o v i t u c l h f o e n o f 2 t 1 o e h t s e g a p 0 r , 1 o S d t e l 0 1 0 o r , g r 1 0 1 1 0 2 A 0 h t n r l nn a e y 1 i . 1 1 1 a 1 n u R e 3 r o p m . r e b m n a 0 2 r i n e s e r d n 1 a 0 m , 1 t u t n a e r p p a 1 c e H . e v i t u c e x E . . e t n 1 , o a n o i g o 0 1 r e d g e m d n e r- e m e m O F C . t s a e h y h T f r p m t a z i n e m e r H m e m o C r o . n u f 2 0 1 h 6 t o t o s a t n a t e h e o a t n i f o . r e b r e h d s a m v e a n o i m s s i d e s i e L l c s r e b d n a n r e e m 1 0 2 r e h t a t d e e t t i m Te n o i t a w e i t r f o u c n u f e g a n n o p s e f i n g i s e k f o c i n h c ee t t i m m o C , l p ö n K r e b m h t A 0. A n e t p o r u E a h c E 3 0 1 , f o n a a e r l o H a e r e h t t u c e x l e t o E t n e m e r e h t n o i x e t r r e v m e m a s l a n a c i r o f e m i c , l e f M M E C F C M M M M M M M M M s g a n a M s n o p s d n e l b i x E c o , e t u f o D s e g a n a m e e e e e e m e m e m e m e e v i E O O n o p s e r r g o i b v i t u c e m m m m m i o t c e r i u c e x o h w o n a t v , d t L o r e b e h t g a p e r o f t u d n e n i o c re b re b r e b re b re b re b re b re b re b re b f m m o C C i l i b i i c l o H e d i s m o r e m m e r h p a e v i t e h t r U r e a h b i s n e x E t e r , m e r a O E C m a o p 3 t E b m e s s C e i d n .1 d n i t i i t a u c l a c i r t m m o B mo C e b t i t t r e h s l i e e m t s e m ö t i e t d a e a er a i t s m G H L h e e ; e s r y m d t v f e n r n e l e k s r e r e n - f o t i m SR a o .n t , s s t m s - r - GB_10_Corp_Gov_e_S.87-105:GB_2010 CG_e 8.4.2011 10:58 Uhr Seite 95

Area Management Compensation, shareholdings and loans The individual members of the Executive Committee Details of Board and management compensation are are assisted by Area Managers. contained in the remuneration report (page 106) and in the consolidated financial statements (page 189, note 4 1). Composition of the Area Management Bill Bolsover 1 Aggregate Industries Shareholders’ participation Javier de Benito Mediterranean, Voting rights and representation restrictions Indian Ocean, All holders of registered shares who are registered as West Africa shareholders with voting rights in the share register Urs Fankhauser 2 Eastern and at the date communicated in the invitation to the Southeastern Europe general meeting approximately one week prior to the Andreas Leu 3 Colombia, Ecuador, general meeting (the exact date will be communicated Argentina, Chile, in the invitation to the general meeting) are entitled Brazil to participate in, and vote at, general meetings. Shares Aidan Lynam Bangladesh, held by trusts and shares for which no declaration has Malaysia, Singapore, been made in the context of the regulations of the Sri Lanka, Vietnam Board of Directors governing the entry of shareholders Bernard Terver 4 Holcim US, in the share register of Holcim Ltd are entered in the Aggregate Industries US share register as having no voting rights. Shareholders 1 Until March 3 1, 2010. not participating in person in the general meeting 2 Since January 1, 2011. may be represented by another shareholder, by the 3 Until December 31, 2010. 4 Since April 1, 2010. custodian bank, by the company as representative of the governing body or by the independent voting Please see page 104 for biographical information on proxy. Voting rights are not subject to any restrictions. Area Managers. Each share carries one vote.

Corporate Functional Managers Statutory quorums The Corporate Functional Managers are responsible The general meeting of shareholders normally consti - for specific functions and dimensions and report to tutes a quorum, regardless of the number of shares rep - the CEO HGRS. resented or shareholders present; resolutions are passed by an absolute majority of the votes allocated to the shares Composition of the Corporate Functional Management represented, unless Art. 704 para. 1 of the Swiss Code of Bill Bolsover 1 Aggregates & Construction Obligations or the Swiss Merger Act provide otherwise. Materials Services In such cases, resolutions may only be passed with the Jacques Bourgon Cement Manufacturing respective qualified majority of the votes represented. Services Roland Köhler 2 Strategy & Risk Management According to Art. 10 para. 2 of the Articles of Incorpora - Stefan Wolfensberger Commercial Services tion and in addition to Art. 704 para. 1 of the Swiss 1 Until March 3 1, 2010. Code of Obligations, the approval of at least two-thirds 2 Until March 15, 2010. of the votes represented and the absolute majority of Please see page 105 for biographical information on the par value of shares represented shall be required Corporate Functional Managers. for resolutions of the general meeting of shareholders with respect to the removal of the restrictions set Management agreements forth in Art. 5 of the Articles of Incorporation (entries Holcim has no management agreements in place with in the share register), the removal of the mandatory companies or private individuals outside the Group. bid rule (Art. 22 para. 3 of the Stock Exchange Act), the removal or amendment of this para. 2 of Art. 10 of the Articles of Incorporation.

94 95 GB_10_Corp_Gov_e_S.87-105:GB_2010 CG_e8.4.201110:58UhrSeite96 Corporate Governance i r p e h T n e g a d w S r o i h t n o t n i c e d e h t w o a h s r o a h s a o B o c u l c o t b u p l e w t e d a g i r w o f o o p s d d a e r e t a h S e h T s e i r t n E o c l p e h T n o i t a c o v n o C e h T n o i t e l e e l t o a d c n p m e t a n i m e l f b h t h t h o s d e i t c i t c s s i e d n e n e c i a n i a l d n e r e r l e r d r i t i t r e c a l e n e s r s t c o s c s a o p l i s i s u l s a t a e s i a n i w n n e l a h o a h e r s n o s n o n a o t d r d n o c o h s s r yn a o h s l a a e n o h s e h g n i C o f o a p m o B t e e e t i s t s a s r n i r a i t d o e m l l o i n i f i f r i a u e r h t n l u n a a i c w t a h e d l h t e m h c l r a e h d e h t e d D o . . i c c u d r a p e b n a r a o i a e h t f o h t a e U e t a f s e l e r e n o o r e r i d o e l l e r g e r n e l a l g y n p p d s r n a f o s r t e m n n e g y a o p p p a f o e n a m e a e a d v i t c i g e b f o y e b i e t e t t f o n i c e t n e g o e h y t e d e r a h s a a p o i n i w r i l w e h d a h s e h t n e m e u n m t n e t s O n w e r, n i t c e t m m d f e n m c e h t r o s m r e r ww ) g t i y l D i w m e p a d o f r d t a l b e r i a a c n k e m y e t e t l i s e r r e o h r i ,s l a n o n e o t e t i h r e r . c i r e a r e l f f a h t n o i a g i q y i l f c i h S f e r o u l n i n u l a r e n e g s e h t o t s i d e h . l a o v r w re t s i g e r h t u s s h c t e e u o r t c e m h t s c t e n n e h t a i r i a o a e v l d e d n a n l o p t i g e e h s e r a c i t r a w f o n n i t m n i i e a c i b s f e r r o u m q e i r e , t s u s n i r o l e i n o t i t j b u S m o i c n o l t e e t i c a r e h s e p t e e a e r g r o g a h t i w s i e h g n e g t t s d e s g f i o h i u c . m e t m e t q c b u s s e t r e w o n i e h l a p i a r u t s m .s a y b a c n e r e i i r d n e a s s r u o t l va n d r e n t t g n i t e e m n i n i v h s . g r i u d l g c h s e y a h t e r e h h g h t t b e m a l l n o r s e e a e l a t i m e n i n i c y r o s a g r f i g e r e e t y f s n e u S /m r a r p p r e n h r a ra r e o t d e c a e r e l a h r o . n e a a x i s t i v n a o m o c s a e l E e t t t ’s t s e e o s l . s e s t o m h c y f b u n a e h t s h w t u o c s A s m m e e d t I a e r e t m d r a h f i l a h t i x o a r a p t e e m s c i g e r a h s s r e t a 2 M G f . d u c s i c d n a d e r e o n o i t r d t i w r o n i t e e e t t i m i o o h t u p p a h y e h t r t i y n a p e r g o c e e s i t e e m o d n a a t i v n m . t n s t n l e t a m e h T e a s m e t i a p i c i t y t . d o o h e r c o c e a h s r e t s a h v g h y a o g e r i n n o i s s s h f d e s g n i .1 1 0 e e r d d a a c i l r e v o O e n e v n d r a h s r e c x E r a d n e g a yt i r a e v g r a e c e z i n p x e d v e t s i g e s y a i e u q e r s e r a g e r y l n n o i t a t i v n o f t s g n t o r e t s i h s r e d l p v t ( r o f e n i y t a n o i t m b u s v s o r a . n o i w o l l e h . e d e n d n s e d e n g i t o b u p h e r a y l s s e r n o n o i t p e t i d r p A s e s s e s o h t r w s n si g e r d g n i d r v s s o t e s a n a b n o i t o c o e e u l a e o i t s l l a h sa n i de r u o h s e h t s k a t dn a y b t i d n se l u r a g n i tc a x f e h s i l b e w d e t t i r r e d l o eh t a r n g n i h t eh t i h w y fo s er dn ot a d gn i k eh t se - ri s e ni eb eh t ke e eh t - e l dl sa d - hc . c s - t a h T s A h T s i l vo g e r e h t f s s a A sr o t i d u A h T s e g n a h C o c t u d h T n a s e s o C r o l b O b n a u a a t s h T r e t a m 2 o i t r e s h C r a a m s a r E u a o C o o i 0 y r s , a e t s n r d e t m t e l c i t d e r e e e d o t i d o t i d s i e 0 1 t t i m m n i t t i m m w w w r . s n i d u a n m t r a p r a p e c i v o t u t g n i s , e s g a n k e m s s e u y m i t a g i s i d u A r A s e r y n a p l o f 2 5 s e e h t r a l n i f o c o t o t a p y b & s c n o r p a e h T t l c i t d n r r s i v o r m r o f g i r i w o l s e r a h f o s s n i t l u r e n t r e h t e r y l h p y r s h t . s n o i k a m i f o t i . i w s e g g u s r o Yo e v o f o h t r l o h n e r f o e e r a p e e g s e t h a t r e h t b a s t n e 2 o n r p o C t i d u A i l g n u s e d i e h t D n u m e e d n c n I 9 0 0 e h t l l i W s l l o r t n o c i v o r g n y b e r A o i t a s m c . m i c e e o t e e d t t u o n e l o f o e b n n a p i c i t h t t t i m m T a l c o f o v w n i , s s i w S y b a s e l c i t t n e o p r o e h a u l a n o i t o t d e r f r H r c s i d n I a h t i d u a , d t L i s y : e p r r a c c e e e h t n s e s u e h t t u a i c l o r i e h t u t e g h t s e d e e c x m o C c i l b u y k s e o c f o H s n o d e t a d u a / m o . a o c m o l a i t a r d r i h t o C o t s e t s n i t i d d n a i t a r e s s u t i r s u Z e e w d e i p m o c o t S c e h f o r o p m i r p m r o f h e r a h e g ( r G t s a p m o i t a l e r s n d n e m s r o t i m n i e h t e r e n i s r o c t i m n o i f i r f f o t n i n a n o r s e t t e o c n I d t L r e n i e s n e f e d k c p u o e h a o n o i t a n d i c d n g m i A i w a p e h t c t a d n t u , h p n i s g n i d t d s e s r e e e t c . t r yn a . G e e t c a o E . e r h r o g n e g r a h e d l o e p h t a v i t r p e r a y n g n i r r. n a h c x r E f t w u o r o p r a 0 2 n i l n i l u p m o c m e v o r h i 33 a 0 3 7 s e i o H n o i t T l a u d e e m o f r yt i v i e r e e r e d n s n r p p a h t o c e e , e o g _ e t t m e h 0 p r e c x c a e 1 o t c e l e ⁄ p r r e x E i t e e m d n a m i c l se r u s a e m 3 e t a ) 4 t n i a t n a h t u s t s u r a t i w h w a h c d c c r e p y b s c n a m o p p a r i u q c r & e g a h s , .g n i t r o s e i n a o i f o a t o s e v o e n e g a p i o f h t o t t . t n e v i t u c s e h o a n r e v h Yo t r o p d e n t s n r E m a d r o p e r o b a s e g n s t A r s e r . d t L e h t e s e r t n e r i d e h t t s g n r a m n a c o n t c e k a g n u o r p s e i o i e c n s m r e t d u a f e n o f n I , e h t a d r i s n o p u e yl t c e d e d e t m o h t “( n f o e h i w S e h T r e v i a w h s r t t .e c n o t i d u a o i s s e f g n i t t e k C & 0 1 0 2 f o i t p o a h e b o a r o t i t i e t r a p w f o r p n e h t o i s e r a e r i d u a f l a n o c s m e Y e n o n i t A i m m s s t t i , e c n f o t o t e r e h l u f u o s e l b a e r e h o c n i u e h n h s n o o p o h f a s , 2 f e n C r o t i d u a i d g n i d t A r t e i g n n 0 t r i - l t o r . n d o h A d n s y i a l d h r l s 2 t r u o o f t t e v d l o f 0 o f v e d e r r a e f l a y e e u l t 0 f e h t i o n a t 2 . e e o i a r . - o i d c p c r h 0 t s n e 3 r d e r r - t f su ” e m o o 2 d e 7 d t l ) a y s f . s l - l GB_10_Corp_Gov_e_S.87-105:GB_2010 CG_e 8.4.2011 10:58 Uhr Seite 97

Million CHF 2010 2009 Audit services 1 12.4 11.9 Audit-related services 2 0.9 2.5 Tax services 0.6 0.6 Other services 3 0.3 0.1 Total 14.2 15.1

1 This amount includes the fees for the individual audits of Group companies carried out by Ernst & Young as well as their fees for auditing the Group financial statements. 2 Audit-related services comprise, among other things, amounts for due diligences, comfort letters, accounting advice, information systems reviews and reviews on internal controls. 3 Other services include, among other things, amounts for accounting, actuarial and legal advisory services.

Information policy Should you have any specific queries regarding Holcim Ltd reports to shareholders, the capital market, Holcim, please contact: employees and the public at large in a transparent and timely manner concerning its corporate perfor- Corporate Communications, Roland Walker mance, including achievement of its sustainability Phone +41 58 858 87 10, Fax +41 58 858 87 19 targets. An open dialog is nurtured with the most [email protected] important stakeholders, based on mutual respect and trust. This promotes knowledge of the company and Investor Relations, Bernhard A. Fuchs understanding of objectives, strategy and business Phone +41 58 858 87 87, Fax +41 58 858 80 09 activities of the company. [email protected]

As a listed company, Holcim Ltd is committed to dis - close facts that may materially affect the share price (ad-hoc disclosure, Art. 53 and 54 of the SIX listing rules). Members of the Board of Directors and senior management are subject to SIX rules on the disclosure of management transactions. These can be accessed on the SIX website (www.six-exchange-regulation.com/ regulation/directives/being_public_en.html).

The most important information tools are the annual and quarterly reports, the website (www.holcim.com), media releases, press conferences, meetings for finan - cial analysts and investors as well as the annual gen - eral meeting.

Our commitment to sustainability is described on pages 40 to 47 of this Annual Report. Current informa - tion relating to sustainable development is available at www.holcim.com/sustainable. In 2012, Holcim Ltd will publish its sixth sustainability report.

The financial reporting calendar is shown on pages 39 and 218 of this Annual Report.

96 97 GB_10_Corp_Gov_e_S.87-105:GB_2010 CG_e8.4.201110:58UhrSeite98 Corporate Governance e M o t r A o h o C a t c s a L e g a B a M a l l g f l o R d r a o B 1 e n i t s i r h C s u k r a M s a e r d n A a L c a l e p A a B l e l e f o o B i t a B h C h t n a e G t S o F n o e e t c e e u a b o n e i i d u e n i s r i t i t k n i h c s t r e n l e s l e s l e s d r a r 2 d l i r i a e n r t c t c t e r a n p n n 0 0 f l a l no r i o S o C r s d o m r e t i s a r o r e h t r u d e d e d e e c d v s e . , , 0 2 A A l a r G n i g f a t a a w w e H f o a l . 5 O t a h p m m u l l a o H t c s C n a . nn a m r e k A n u d o t 5 0 o t n n i m h h u o w n vo p p e H e H e d i a h i b m a r e r e N g re g n a w s n i B g e ,s k o r e r e r a s t c l e e f n i t , , o e h t f v o G . n r e e h t p “A h n e i i i D e r g B r i l i r i e e e h t c c S a m e e r m i f i a h f o e at n a l P h n i t s e s a a a m r o n i w a m e v ,a m r a e v I 2 e r e h e h h t v e n n e a 1 1 0 n a n a e B s s s i w B i e e c N i t L d i n o t c B g i b 9 1 n U e a o m i t a . l d t n n a o a n i h o s a s a w e m s a d d sr o t c e r i D f . a i t u n i r G , a t b 8 7 I , d l e e s o r n e w f o m e a A o n e m d r , r. v i d r u S u b S n i o H n i o d e r t a p a n H r P G S 2 i w m , l h c a c Y e v o r F r e 0 2 , t w t n o 2 0 0 a e e h o , n i o i l ( e b o o i 2 z i i s v e h b m S e c l o p s a B n i l i s f s s s l n r r s s i e t i 0 0 r a a e f a e a w i w h t n r 1 0 ”e s s e n e d e n k m m i m D r y t t m i l e s G u b B o i a n a o f , h r e a n l r ( t a n i d n a , f o s s u t c e r i .8 o L n s h , l . a o 1 e h s r o j v o e a e e t o y T s u s . L f 9 9 e H r t a o i e i s e c e l e v e n , o b o i t a r f a n t c t h P w S 2 x e c e . M r a n a g d r d e d e r f e h s i w S w s e n a n n o e h S o i 3 0 0 o p , n i d 6 r o r t n i a s i d e t c C o n o i h c i t r e p o N D s a , . a d n , l a n s i h f o f d e t c n u t l a h 9 1 F s o r s t o e s l a s s s n i r t i f f s a g m o , l n i d n u o n r e n I m r i a n o i t i , l a n r u t c e t e t c e l e a n i m o . c S e c n e i n u d n a 8 u A . c l o H l i t 1 s c i m n I b g n i d a m o r F f , d l e n I r o b ) 3 h P o t o 4 9 1 a h C 8 9 1 o w h o H r t s u d s a o i t a l i t t t i d h c r a M n r . a n r o b o f e h 9 1 o s o l i n a s e H e h t a n o i t , m i , 5 , m i c l e b m e m . K U , 8 z i e g i e r s a o i t a m r i m o r f d e i n i 3 9 u C n i r p n 9 9 1 i l a n T E i t c a a h C o n s i v a m i t l h a g e b o t y b n i m m o y s i r e B 9 1 n , c f e r e h w n e y h p n i 5 9 1 e H H e h r o s A & d r a o h t d t L g n i t i 3 d n a m 0 0 2 e h t o B n u n a m c e b 47, e h t g e i t i v r i e h t 4 6 9 1 r u Z o p e h c n u o C o s e o , 5 w 1 0 2 n e b n a m y l e t d r a r n i f OE , C . e e t t i a o B e m a e t a r , 5 s a r a o B n a i c f o i h l i t D e d Fe e p m f o t a e h t h c i n a g . s v i n U e h f o r p 1 N 0 y t u p e 2 h s , u t c a f 2 7 9 s e o p a O e h t t s a n o i t 0 m e m a e r i D e d r f o s a o r p e h f s a w d n a b m e m o i t wa l n e H .3 0 d f o u g Re p t a s n l a r h s a w n i o p h t r o s s e r e C . n t r a o e h t a J f o a h C s i e h t t n I e H n e i s s e f O O - l a n f s r o t c c “e r e r i s e e i d u t s , a h C O r a u n r e b r p a i D s u b r i D y t G n n o i d o t a l a n r e d e t – e v i t c c i f f o B B n a g e b r e o t c e r i r i o o r r e o o Vr e 9 1 t a f o o d r a o l a n o f o a u d a o n a m s e f o t c e a m r i d r a f f f o s s e n i n n a y o m m o C e , 4 9 o y r a S c t n u J L F P E d n o i t . t S i s f u s e i m o c i r t i a , 1 f o i s t f o n o n i d c l o H e h r e h c w a l B z o d n h t f s r h t r 2 0 0 2 r a p e r a c f o n e t o e h s s i h s a w d r a o a G D e t l u C a a n n i f f e l a e o t c e r i o f o o B a L 0 2 d i c a n I e r i D m u n e h t t . e e t t i f f a o B t a n e l l s Ex g n u m i l e s s i e m i t - e f o r p r e i m m o C c n a b e h t n n a s u L i t s o H , r a h P d r a a c , 3 0 g a n a M . e r u z n o s r o f o h c e c e e h t i t L o t c B e r d r e u t n d n a e b l s i ” i i t u e m a c I S r a o n a o B g n e G - R s t u o f o d s a w e H e 1 d n a m i a s e t a m S o l o 3 8 9 r i n U b X s r r 9 1 s i e h e v . e f o r G n f o i s a D t i n i d d n a f l e r S o o e s i d r e d i e t s D 7 d t L c n i s n c e r i a I S i w 1 A f d u t p a l a n 3 o v o C t n s a w o t c e r i o r 4 9 9 1 g w s o l e t a o e G p u I f a p f o 7 9 l a e h t t n . s s s r i 0 2 r o p – P i l e m o i D i m m d n t d e a h c t e e i s s r o t w i n o r a c e h 5 t r f h i D e r e C s t L . E e e r a 4 0 t 0 2 r i l e l o H i d , t i w i a h e t n e n y t c e c x r t L s p t a n e h o t c e r r c n i , d e n e g , t f h m c e z n e h c t ,s i h , f o d o r t , 3 0 , m i c i d u h t g n a h t e l e r t s B t r g a n a o d c e l e e t r t s r r e e l B r i a d Re e h e h n a m o i t a i d u s s a B r o r f n i s a t E C c u & o s e t c e l e d d e d e t c s a , p u o r G s r d n a l a n , e h l e r e H w o o a w e r e t t 1 y g n e t S O m e C i s f f e o 7 9 d e l . s e t i t , p s l o f f o t a A o r n I , ) d r n a b o N t o c a e c n d n a s a s t h o d ( c a 2 o z e h n u G a e r A 0 e e h r l u l i t n u h t o s s 2 0 0 d a e e s t h t r e m 2 c i m o n i l i b i s n o p s e r l e h , d . s n o i t i s i u q n g r e b m e m e h w a w 0 t i r Zu i t , e t a r o t c n u e f l e y a M s i ( D e o B t a e r 0 & i m C I l e g a p b i t , n i J e U M r U , 9 l i t n u 2 h n u l i t B e S . 3 1 0 2 e d a r a v R d e h t i 1 0 . h c n i n i l s s i w - n a e t e S C n a c o e i h a m ,5 0 0 2 d d n a i b g 2 t l d n a 1 .0 9 e v e v ) e y p o e M 1 0 y l . a e H r a o i la u n n a h t S e t n i h t w f n u n 9 1 r e g r k r r d f o f e H r o 3 a m eh s . e s kn a B o o s a u D e , eH s e i i e )1 8 y t sa w z t y t z e s h t o r nI t r i h t y - dn e an r bo la i c ro f n i ro f ce n n e fo o t e - f - - GB_10_Corp_Gov_e_S.87-105:GB_2010 CG_e 8.4.2011 10:58 Uhr Seite 99

Beat Hess , Swiss national, born in 1949, member of the Board of Directors, elected until 2013. He holds a doctorate in law and is admitted to the bar. From 1977 to 2003, he was initially Legal Counsel and subsequently General Counsel for the ABB Group. From 2003 until end of 2010, Beat Hess was Legal Director and member of the Execu - tive Committee of Royal Dutch Shell Group, The Hague, Netherlands. He is also member of the Board of Directors of Nestlé S.A., Vevey, Switzerland.

Erich Hunziker , Swiss national, born in 1953, member of the Board of Directors, elected until 2011, member of the Governance, Nomination & Compensation Committee. He studied industrial engineering at the ETH Zurich, ob - taining a PhD in 1983. In the same year, he joined Corange AG (holding company for the Boehringer Mannheim Group), where he was appointed CFO in 1997 and among other things managed a project handling the financial aspects of the sale of the Corange Group to F. Hoffmann-La Roche AG. From 1998 until 2001, he was CEO at the Diethelm Group and Diethelm Keller Holding AG. From 2001 until end of March 2011, he served as CFO of F. Hoffmann-La Roche AG and as a member of the Executive Committee. In 2005, he was appointed as Deputy Head of Roche’s Corporate Executive Committee, in addition to his function as Chief Financial Officer. Since 2004, he has been a member of the Board of Genentech Inc., USA. In 2006, he was elected to the Board of Direc - tors of Chugai Pharmaceutical Co. Ltd., Japan. He was elected to the Board of Directors of Holcim Ltd in 1998.

Peter Küpfer , Swiss national, born in 1944, member of the Board of Directors, elected until 2013, Chairman of the Audit Committee. As a Swiss Certified Accountant, he began his career with Revisuisse Pricewaterhouse AG in Basel and Zurich, where he became a member of management. From 1985 until 1989, he was CFO at Financière Credit Suisse First Boston and CS First Boston, New York; from 1989 until 1996, he was at CS Holding, Zurich, as a member of the Executive Board. He has been an independent business consultant since 1997. He was elected to the Board of Directors of Holcim Ltd in 2002.

Adrian Loader , British national, born in 1948, member of the Board of Directors, elected until 2012. He holds an Honours Degree in History from Cambridge University and is a Fellow of the Chartered Institute of Personnel and Development. He began his professional career at Bowater in 1969, and joined Shell the following year. Until 1998, he held various management positions in Latin America, Asia, Europe and at the corporate level. In 1998, he was appointed President of Shell Europe Oil Products and became Director for Strategic Planning, Sustainable Development and External Affairs in 2004. In 2005, he became Director of the Strategy and Business Development Directorate of Royal Dutch Shell, and became President and CEO of Shell Canada in 2007, retiring from Shell at the end of the year. In January 2008, he joined the Board of Toronto-based Candax Energy Inc. and was appointed Chairman. He retired from this position end of June 2010. He is a member of the Advisory Board of Lane, Clark & Peacock in London and member of the International Advisory Board of GardaWorld, Montreal, Canada. He was elected to the Board of Directors of Holcim Ltd in 2006.

98 99 GB_10_Corp_Gov_e_S.87-105:GB_2010 CG_e8.4.201110:58UhrSeite100 Corporate Governance i r a d s a m o h T g n a g f l Wo h f o i S e M h t u Z o C o t e v e s x E l e o k s e c n t c e s r s t t e s r u c e e t i r n u n h t t e o G o c y t i e s a e , d e h a r i i c v d n g n 2 i t U i l a G n e v l a 0 0 o y r e v A S t yn i e h d i m h c S f a u o d n f s h t o o C n r v o d S re r ü h c S ,6 a r o C . O E r e i t t e . t e H n a t o c u E e h n o h o t c n i a n L m m G e p m o k a e c o r e t b l a o B f c n h f r a g e , e o e p S M n e l t a n r a N t t i e l , d r a r , e o C s S e o a t a u m n e m w e e s , n N n n i m M o f s n r e w , o i s s i f o o h S A n a i t l o r h e v n i m a n n a t i w s i f e t f h r e D a a f n a n d a H c s i o i t s s l i t a d e r i e g e r r a e c g e r o a a i t r e s s h h o i n s n i c l t t c e e n o n e m e s i o i d n a a t a a a n & a l u r o s m v w r n s l a m o i e c i e w i i d u t , l C s s a n & n i o t t r e b m e , l a n c E f e p m o r o b o s m r i s 7 9 1 S l l C f a w a y r 7 9 1 o r e n i s e e p m o i c l o H s a o n n b n e i v 0 e h t , 6 o n i w a s n d e d r n i a e c ym . a n r o r i v f o h t i r e h w s r 4 9 1 m ,a i s A a l u g e t a s n A T f i t s i w S e i e H n e G n o i n e m n n a L n a c i n h c ,6 d l d t , 5 4 9 1 e t S a w n o i r o N m B M m m o C h s o r h i . n f r o n o v ’Re r e b m e e G s . ) t , l a i s 1 m m o C A n i t i s m n e l l a h t e h i a t s u 8 7 9 e l e s e H D f r e b m e d l r d A r a A c e r i . e e t t i d e t c o i r e m g d n a m y s i t v f o e l b a n n i ( e h o r P e e t t i o t c o d o s i r o t a h C e h t e h t r e t o t , a c o e H s a w f o r o s s e f y c i f f w a m r i t n . D M I h t v e d P e h d r a o B r f A H e t a r h t i i d u t s o i t a l e n a h C e e e r o B i e m p o l e o t s e C o B n , a c u a L f n a m r i a l a n f n i r o e i d u d e d r a f o d n a C t n e m d r a f o E 9 1 r i a h P e n n a s o c u e h t c e l b u e r i D 9 9 o o r d f o s s n f o t n i n a m p o c e m c n i m o n D . F f o c u r i D e s e H o o t c i o r f l f f A e e r 1 ( p A d n u d n a t t c n a e h o t c e 7 9 i n a h 0 0 2 c i r o r f i m s r i a c s a c ,s o t ) 2 i t a C B d n a t T y e r m s e h 9 i a h o t f u . s r s d e t c e l o c i f I o t a d r a l a n o s a 1 , d n a r n 7 9 i M c e l e m f r s s 9 9 9 1 t g n e n a m o L l o H a i n U e h f i 8 c d d o f d n m o r e m i s a w d e t n u t n u l a s u c i U i c l e v n u a , e o e h e v i n s b m m i t e e f E i c r i 1 l i t n u i p a l l i s 8 9 N t s a g n t n i r s e c n e L 0 2 2 a w h r e t d t i r p l e b o , 2 1 0 p y t i s r e y, 4 n o o 0 g s a f o s o B n i M u i 0 2 1 a t n a . n r e b m e m s a e t a r t s t l l e w e h t H d r a w 79 .9 1 a t f o , 2 1 e t i t e r a l a s d e h z e h t .t S 2 e w m T-S f o d t 0 h c sr e n n i w s a o a E e e 0 y g e l l a G s d T r i D t u me t s y b m in U 3 na m h H - . a dn a fo e n ce re - .n - - GB_10_Corp_Gov_e_S.87-105:GB_2010 CG_e 8.4.2011 10:58 Uhr Seite 101

Dieter Spälti , Swiss national, born in 1961, member of the Board of Directors, member of the Audit Committee, elected until 2012. He studied law at the University of Zurich, obtaining a doctorate in 1989. He began his profes - sional career as a credit officer with Bank of New York in New York, before taking up an appointment as CFO of Tyrolit (Swarovski Group), based in Innsbruck and Zurich, in 1991. From 1993 until 2001, he was with McKinsey & Company, ultimately as a partner, and was involved in numerous projects with industrial, financial and technol - ogy firms in Europe, the US and Southeast Asia. In October 2002, he joined Rapperswil-Jona-based Spectrum Value Management Ltd. as a partner, the firm which administers the industrial and private investments of the family of Thomas Schmidheiny. Since 2006, he has been CEO of Spectrum Value Management Ltd. He was elected to the Board of Directors of Holcim Ltd in 2003.

Robert F. Spoerry , Swiss national, born in 1955, member of the Board of Directors, elected until 2011. He holds a degree in mechanical engineering from the ETH Zurich (1981) and an MBA from the University of Chicago (1983). Joining Mettler-Toledo International Inc. in 1983, he was the company’s CEO from 1993 through 2007 and was nominated Chairman of the Board in 1998. He is also a Board member of Conzzeta Holding AG, Geberit AG, Schaffner Holding AG and Sonova Holding AG. He was elected to the Board of Directors of Holcim Ltd in 2008.

100 101 GB_10_Corp_Gov_e_S.87-105:GB_2010 CG_e8.4.201110:59UhrSeite102 Corporate Governance h P f o 0 2 u S u Z e m 9 1 h C h n e f b u a h a m n u s u k r a M e v i t u c e Ex l u a P k c i r t a P s r U s a m o h T e B f o n i o H r g f o i m e r a l f o e C o i e e d n l o p s r u d a 6 9 i g l r t o p p e m H 0 0 i r l i h t i l i t e h t C t e h t e h t m e c l w s t n y t k r E e t ne l h ö B p p i o h c v r e n o s u m i t s a re l b o t n e g u H r o s a , n a m u t e 1 o p r , s n e f t n h e r c i a 8 9 9 e h t r r o E d e t A E g . i t i n a n i gr e b l o D n i t e d e g n i d l a e H x nn a m r e k A r e e x U n o p s H i b i v d re h c s i b e A . ( Ko L r u c e w .s e s e E o n l a .S e H t I t a e d d t n , g n I t u c a a n a d a , i l w s a h yl a w o s g n o j a s e t s w S I e u E i t o n i w e t e n i t i i t i s b t i n d e c o r P f n i e d o C e v i G o , s e v h s n r 0 2 a g e o r o H l i b a 1 h s s i h t n r f e 8 9 1 f , r e r e e n e e d e 7 9 d n e r g v o e B n r f s o C a e p h t j C 1 e f e t i S / e v , o C e v t c e M c l t o i t 0 , , 7, m o a n n S m o r e o r 0 t y g l w S a C e l p c u Z n , a r m i ee t t i m m Co e u o d i w h a d n a m m a i h i t h t f l l a o r t s a i l l a n i t n a i U n e a e r o n i M d n s a l a t n t i m e v i r s i T s s h t a s n o d i n a M C e n x E s e h n a l h c g P e s l l s m e n o o r p a n a g E C t t i E C o B h t a e e l c n a n a n N o r e m e n i l a o c u c e n e t . o H m o n a . p o a n e g a a r e v v o r F e r e e d a a e O e j n I e t s , O g a o d o i t i t e f o n e o i t r o b d r m o f g a I C r e f i h i c l r e g t c m e v i t n o t a f o e l p , o M s ) a f o n i s s 1 r e B h i m n r a n G n i 9 9 l C / S t l a n m n e m e o n i M e n e , l a H A . H r a S o t e b o P m e c 0 2 f e n r n o o l c E t o t u , 6 m a i a c l o C g a n a i , a n g o r G D f e h t p u o t n a s n , u i p s a d e t n e n r o b n e i c s e m u s s r o b h c S e h t i m m o r e h t 2 0 o b n a J r c S c e r i e h e p o r . u o 9 1 l , 1 m i p t r F m a r n a r a c o y t i C n r 0 0 2 a n n o h e t t a l t 0 . 5 f o n a y r a u r e p d n e o j o t c e s e b i r o s r o t u o c c w S . e c d n i n i m r e e c n i d e n i Pa e e t t d n a s i h 0 2 n a e h t d o r f o x E s r U .8 e m e C e z t i n o i g e 1 4 9 1 . 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A a t u o i t 1 i n r m o i w y t r F l h k r i t o gn i d l r n c S 9 s s e c l e n a m r e b m e m . m s e a e 9 1 e v C e r y, 7 7 m o e s ec n e r w a L s a , t e m 9 9 9 1 h t m i s o o p h o e h h a l F a t n a t 5 8 S s f u H o C v i t O e C e h t p w E n m B s n r e x o b m t o o a o G e 1 o o d e o w , x h o r e 9 l g t i a n m r , n 1 n x i T E li t n u e f C a 29 e e p u o d 7 9 b e z . n u d o s re s - - F l i ,e s n H e - O r fo r 9 p - s , GB_10_Corp_Gov_e_S.87-105:GB_2010 CG_e 8.4.2011 10:59 Uhr Seite 103

Benoît-H. Koch , French and Brazilian national, born in 1953. Benoît-H. Koch completed his education as an engi - neer at the ETH Zurich. He joined Holcim in 1977, occupying various positions at Group companies in Brazil, France, Belgium and Switzerland until 1992. He has been a member of the Executive Committee since then and is currently responsible for North America, the UK and Norway, the Mediterranean, including Iberian Peninsula, and International Trade.

Roland Köhler , Swiss national, born in 1953. Roland Köhler, a graduate in business administration from the Uni - versity of Zurich, joined building materials group Hunziker, Switzerland, in 1988 as Head of Finance and Admin - istration and transferred to Holcim Group Support Ltd as a management consultant in 1994. From 1995 to 1998, he was Head of Corporate Controlling and from 1999 to end 2001 Head of Business Risk Management. Since 2002, he headed Corporate Strategy & Risk Management. Effective January 1, 2005, Roland Köhler was promoted to Corporate Functional Manager responsible for Corporate Strategy & Risk Management. The Board of Directors appointed Roland Köhler as member of the Executive Committee, effective March 15, 2010. In his new role as CEO of Holcim Group Support Ltd (HGRS), he leads the central service and support functions of the Group.

Andreas Leu , Swiss national, born in 1967, studied business administration at the University of St. Gallen and holds an MBA from the Johnson Graduate School at Cornell University. After working for the International Com - mittee of the Red Cross (ICRC), he joined Holcim Group Support Ltd in 1999 as a consultant. In 2002, he was ap - pointed General Manager of Holcim Centroamérica, before assuming the position of CEO of Holcim Ecuador in 2003. During 2006 and 2007, he also held the position of CEO of Holcim Venezuela. On August 1, 2008, Andreas Leu was appointed Area Manager of Holcim Ltd, with responsibility for Colombia, Ecuador, Argentina, Chile and Brazil. As of January 1, 2011, Andreas Leu has been appointed as member of the Executive Committee and has taken over responsibility for Latin America from Thomas Knöpfel, who retired at year-end 2010.

Theophil H. Schlatter , Swiss national, born in 1951. Theophil H. Schlatter graduated in business economics at the University of St. Gallen and is a Swiss Certified Accountant. He began his career as a public accountant at STG Coopers & Lybrand. After six years, he moved to Holcim Group Support Ltd, where he was active for a further six years in Corporate Controlling. From 1991 until 1995, he was Head of Finance and a member of the Executive Committee of Sihl Papier AG. He then served as CFO and a member of the Management Committee of Holcim Switzerland for two years. He has been CFO and a member of the Executive Committee of Holcim Ltd since 1997. At the end of March 2011, Theophil H. Schlatter will resign from the Executive Committee and retire.

Ian Thackwray , British national, born in 1958. Ian Thackwray holds an MA (Hons) in Chemistry from Oxford Univer - sity and is also a chartered accountant. After his studies, he joined Pricewaterhouse and handled major corporate accounts in Europe. In 1985, he started a career with Dow Corning Corporation, serving in various management roles in Europe, North America and particularly in Asia. From 2004 to 2006, he served as Dow Corning’s Asian/ Pacific President based out of Shanghai. In September 2006, he became CEO of Holcim Philippines. Since the be - ginning of 2010, he has been a member of the Executive Committee, and with effect from July 1, 2010, he has taken over from Tom Clough, who retired at the end of June. His area of responsibility spans the companies in East Asia, including China, the Philippines and Oceania, and South and East Africa. 102 103 GB_10_Corp_Gov_e_S.87-105:GB_2010 CG_e8.4.201110:59UhrSeite104 Corporate Governance t a a h p a l A o t a d Zu 0 2 f A a e y e G r e i v a J a e r A d r a n r e B s r U f g a a w n i o s a U a L a M Te p a r f f o a e i A o v m o r e p s n o r a d k o e t h c n a r e e t s 1 s r e d o p o p i r s 3 0 s G r a s 8 9 a l K “ r k m n e re s u a h k n Fa h c ö B e e b r r s A p p a n r p i n a g b s y a u o o n i n i , i c U n r o n a g e b t u 6 o e d e h o i y d n n a n L i w l a c l h o t s n ( l a i n d e t d e t a i f n y H T E o w p n o H c n ó re v Tr e r y, E h t i o p , n e t s i d e v , ot i n e B h t s e w e m n i r u a m l tn e m e g a n a M ma E C o r n i S h D u r v e t n e m o t e r k r l A A s a i s r s e c i n i p o r s e f f h Z t k r o p O d e e r e r l e m i p s e b m n i r o a n r e p , a g e t e r r u g n e y t r u i c p a a , .e , c o i a a f o g , i s i s F e h a w , o t m e g a z i t f c i o p S r F d e n r u e C o n a M a M r o f n i o p a p S n o o i t s o i h i w n e e r o H ) h l o n r n a n n e Te n u , e r e n s r n a d s i o s b i s M E n i n a m e l a s s n a n a n a h c f i p p a n e a i n i c l o t e c a c m r n l r d i s s d d a e c e t o g S h t f o t s p s e e l i n r e g r e g h s f i r e 9 1 t m e e r t n B H e p x d i y t i n i t a r e n g i r o e h t n p i o e c t a e D o u D u a L l o 9 8 A d n o o r n S U a n e s f t a o i n 9 1 n r e e m d n a o f o i e h f e r l m i c t a k n i r e e w o H u p a i l b d e t o c e j n i . a n r u E Re a M i s . 4 9 i g n a n d n r n e e H r a a o i o i a n G e l b n y t h t i c l s i d n o c , l t u p s t n a M s t l a n m , l e Vi r p o e h e c a g a n o r G e e n u n a o b n e I h e d n m m n e G r t n n r o b b w e b m e e n o i p u e o f e n i n e d n A , t l a r e n i l e e t s d ” r r e d g a n a 1 s d l t c e f f t i . d t L m a n r e r o b n r e g a , 9 9 9 r c n t e Vi n i r o f o g E . n n a h e h t i l a r e n i l l o H f o f A n i n n i o o t n i 2 a t p y a e h t l n r 9 1 c Ee x n I 0 0 r e t s e v i n e m e I 1 d n i t s a M m i c l n a M i n a p S g f o 9 9 1 n a l e r s a r o f , 3 6 9 n r e B n i f 5 9 1 .m a a n a n a M ,6 9 k n a n i s i h t t a . 4 a H T E i d l o h N n e s f C r t s u 5 9 1 d n s n o i t e v i t u . 9 r u , 2 e h t A O E m e v o r e g a e h t S U a r e d r a m o c t ,d h s s e c c I r e h t n g i s s c n u f , 8 S r o i n f o r e g i r u Z l c n o y, f o b o e z t i w n i t i d e M g n n a 2 , s i s b u s x e e d r o f Tv r e n i A B M c l o H e t e l p e C 0 e i d u t g a n a m f o n a J r e b i c S 2 d n i , n o i t n d u t s . h c , 2 0 r o p e s m t r a p d e d u d e . 6 0 0 7 9 1 a r t n H g A n i n a l r e c n e r e a r e v 9 1 y r a u m i a r r e 2 r a i d i c l o o r f o t s r U t e h d 7 d 0 1 0 9 1 a g e r g s e i , 2 9 b e h o r p l s i h n O e h n e m e s u b .d e m a c e s i h t L e h t m 06 , m A t n e l a w m , n a e n y n i F , 1 n a m a , d w s i A O E C o i t o m k n a v o m c M I c u d e J t r C 1 1 0 2 r e ft s s e n i s s o M a u n a h t i d l o h a c i r e o M e t a e r h t f o e i d u t i n a p m p a i m u s s D i t a o t n a h c e e s u a h s n o p s r e g a I e d e f o i d n I f o a O E C p s e r r t s u d n n i , d n e p s o p o i t a g n i n s n e h a H n y r i m d a a d n a l o H r g g A n a s u a L s o t n i n i c l a i n a n i g n 1 d r a v r p m o s e t a s a w i s n o n a c i f o d e t , l b i r t a n r e t m e c o n o H 0 2 m i c i r r a t S t a g n i o j 0 2 e h t o r c O e h t i d e n n a o c r t s i n g e H l e e e n i 0,1 b E Vi s n a l p a v e h t o 0 o f e t n u n a e e i g n e t a i B s i s .S U t L c l 2 i l e c o r p r a C s o c E t n r u o s u r y, i p e h d i y t o i t a i o , d . d n a o r b a e m o m o t s i w S y r e n e H s e h l a n e r P l o H n i e h I p d n a t n i e j i e n u d n r o f e l w t e D b b o r o C o o r n a r e t c n e y i e o j o j s o t k r a m P s e d a h t c s d n a e g s s i n i e h t s o l d n a o k m i d t d d W s r a n i e n i t s o o p c u e r o e F e t y l c S t n e g f p u e b m r A d n a o f e k e d e i r e e e f f r e H s n . 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Te E 2 h L i g n Re S s s i l e r e h w a e r A t s 0 n e h p o u i l o Tn h c e p u d w y O r t d I t a i e m g e b 0 n r e v i n a n g i t s n I n U s n a n n i a n i o S 8 e m i w o p t n 9 1 s n o r c l o H n i , 1 t A m e i h na M s a d e h 9 1 9 o u i t a w e r r p t 8 v t n a a b f 7 eh s t t o et u t r a e 8 9 e k h .6 i l e i L s r s r n , mi yg o s . l 1 - l o r t h - g n 1 d i e , - e GB_10_Corp_Gov_e_S.87-105:GB_2010 CG_e 8.4.2011 10:59 Uhr Seite 105

Corporate Functional Managers

Jacques Bourgon , French national, born in 1958. A graduate in mechanical engineering of the Ecole Catholique d’Arts et Métiers, Lyon, and a postgraduate of Harvard Business School, he joined Holcim in 1990 and occupied sev - eral positions at Holcim Apasco in Mexico, mainly as Plant Manager at Tecomán and later responsible for cement operations as member of Holcim Apasco Senior Management. He became Head of Corporate Engineering at Holcim Group Support Ltd in Switzerland in mid-2001 and was promoted to Corporate Functional Manager, Cement Manufacturing Services, effective January 1, 2005. Jacques Bourgon is a member of both the Industrial Advisory Board of the Department of Mechanical and Process Engineering and the International Advisory Board of the Swiss Federal Institute of Technology Zurich (ETH Zurich).

Stefan Wolfensberger , Swiss national, born in 1957, has a doctorate from the ETH Zurich and also completed postgraduate studies at Stanford University in the USA. He joined Holcim in 1987 as a management consultant. From 1990 to 1994, he was Assistant to a member of the Executive Committee. He was subsequently appointed CEO of a Belgian construction materials group. From 1997, he headed the Mineral Components/Product Devel - opment service function. He has been Head of Commercial Services since October 2004. Effective January 1, 2005, Stefan Wolfensberger was promoted to Corporate Functional Manager, responsible for Commercial Services.

104 105 GB_10_Remuneration_Report_e_S.106-117:GB_2010_Entschaedigungsbericht 8.4.201110:59UhrSeite106 Remuneration Report & i t f m a a s A m o D t m a T e r u t c e t i h c r A T f o l a i c n a n i F s s e c c u s o s l A m m m c e v i c u d n o c e v i t c ra t t a n o i t t e k r a m n o i t ra e n u m Re s n i e h o i m o i n e d n e s s o m e h i h f t r i n a n e e e t i n e m e t e d C m i c l o H h t n n a h t c e s t m o e m r o G e p n i t o e e s s g n t s t e g a p p e e r e b r o t a i c r e e j b v o f o o r a s e e y s n g e b a m w e p t e c i l s g a i m o t r e e m l s d n a v d s o e r e t c ra , t a h t n o i t a s n e p m o c a n i h t c s n y f o dt L n a j b g a n a o a n d e n t m o n i e v i e s i n a r e g o i t t n f e i c e t a h t n d f o m n i n e l c n v o g a n r e p , s ,m i c l o H d n e p s h t o i m e v i t t e s h t . e d i w d l r o w s a e d a a b o f e h t f o , e r a n a h t t t s n g y i A r e o i n e o f n o i vt a i t o m h s e n r e n e e w N a s h t n n o C f o e d e s g i m t t i n r g n i t t e s - y a p o t r e y o l p m e t e s m o l e r h h f a m c t r e b d n a s i t e e h t r o , m m a u g n e h t e o p u l l d d m a n i n o e e c o G p m a n i g n i o B n l f e c n t l n a o s r o f r o o p o b d e h d Re e t a i t t t i e v y e s o o c a e t e s n e a e i n e h t e g a f e m f o t r r e h t i d o i o p g n i n r e v o g n r e e d r p o p m h t p yn a p m .o c g n tr o p e r s ,t s u b o r r, s e f n m r e t f o t i t a n a v e s t r e e m t e h G t h t s r a t u c & e h ss e c o r p n e e h a o o i o c e x E o n i u o i i D e c c o e s e k f f e v y o e r r o C s i y n n .s n a s g n i e h t d r a o B :r a e o t c e r l o H h t o d r a e , s r e v . t s n a n r o N f e e r g e m n o i t t n r o e v i t u e u d I r u O a e y t e h t s e i d o b r e m i c e h t a s n e p ra e y n i d n a a n i m t a o h t a t y e h t s r e h ra . e , e c r m f o o f . e t o n e h t l s i a c f o s d L m o C , r e b m e d n a i r e h t o o B d n . d t f e h t n D N n o i t e h t s e s s a e h T n o i t n a n i r o f e p m e i h c a s e e y o l p m e n o i t a s n e p m o c e r i o n i m o n i g e b u a d r a a n i d r e s N m i c l o H l A e t t i m re m t o t r o t c .n m u t o & OE C ro i n la i c o s as n mo C s fo de s a p ev y l h g i h la o i t a fo s m r fo gn i n s u o i r va ni yr ,s - y - e - - n e e t a o B v o G m o C e h t e h t p a e y i c e d u j d a t e e m v o G r o e h t m o C e h T m o C s n e re fo re e h t r i h t a e v i t i t e p m o c r d r k a t a n r e e t o O E C c e x E s n o i s a h C n e m t s a s n e p a s n e p a s n e p t a s i a n r , g n i e h l a c i h c r ra e i h o h w d f o d i l o s o i i e i v e r g n a p i , e c n u , e c n r d n n a m r i D e h t e v i t k a t e m r e t e i t i t i t o r u d s t o t c e r s e i t d e w f n o n o n o i m o N o N m e t s y s n e m e h t r a o B t e e n i m m m o C o f o o n s r e b m o C m o C m o C e t a re c o t i m h t n a s i s a b s r b a o B e h t . e t d y e i t a n i t a n a d t s h t s i d n e t t s t n a w a m m m o B f o c e r e e t t i I e h t i k r e v o G n r o f n i d e e t t i e t t i e t t i n o n o d r a g n o i n e s a m m o o G f o u a n i f & , e e . e & e h t n m u t e u d tn e m y o l p m e r i D t o v o n a n r d e m r fo n o a m s a h n r e f I f o C e u l va m o C r r e h i c n .s l e v e l t a d n e D o t c e a m c e n t e e m n m a y t c e r i , e c n a e c , e t o f o a v n i e y o t p o h t a s n e p m e g a n as n e p m o c l r a s s e , a s n e s r c i f f o c t y l r a N e s n o i ne v o r p . . s g n i e t i c i p o .s r o n O a n i m o o f a n i f a s n e p m N s r e e b r n o i t m o m y, d n a s i s a b n o i t s a .e d a m t , t n e r e t f A e b m e t i a i c n e h f o c s i d e y a n i n o i t o r p na o C h t o C r a c , i w t o l i t i w ,d e s s u i ee t t i m m y l e m c p a e m m s r o n o t mo & o h t r G n h b i hc s f o gn a f & t e o o h t ti - i s h s pu r - e ,s - e GB_10_Remuneration_Report_e_S.106-117:GB_2010_Entschaedigungsbericht 8.4.2011 10:59 Uhr Seite 107

Compensation policy determined at the beginning of the year. This amount Board of Directors is only paid out if the objectives set are achieved by The members of the Board of Directors receive a fixed 100 percent and is accordingly variable. Moreover, fee, consisting of a set remuneration in cash and minimum and maximum objective achievement shares in Holcim Ltd. The shares are subject to a five- levels are set for which the respective minimum and year sale and pledge restriction period. The Chairman maximum payout factors apply, as detailed below. and Deputy Chairman of the Board of Directors and Payout factors in between are interpolated linearly members of the Audit Committee or the Governance, depending on objective achievement levels. Nomination & Compensation Committee receive additional compensation. The Chairman of the Board The Group-related component depends on the finan - of Directors is insured in the pension fund. cial results of the Group. If all objectives are achieved at target as per December 31 of the relevant year, it Senior management accounts for senior management (without CEO) in Senior management of Holcim Ltd includes the the average for 61 percent and for the CEO for 56 per - Executive Committee, the Area Managers and the cent of the variable compensation. It is calculated on Corporate Functional Managers. The annual total the basis of the achieved operating EBITDA and the

compensation of senior management comprises a return on invested capital after tax (ROIC AT ). Both base salary and a variable compensation. Members of objectives are weighted equally, except for Area Man - senior management are insured in the pension fund. agers, for whom 60 percent derive from the operating

The base salary of members of senior management is EBITDA component and 40 percent from the ROIC AT fixed and is paid in cash. component. For both components, a target objective (which, if achieved, results in 100 percent of the tar - Benchmarking of the total compensation is carried geted variable compensation being paid) and maxi - out periodically on the basis of the annual compensa - mum and minimum target levels (which, if achieved, tion reports of benchmark companies. The benchmark result in 200 percent and 0 percent of the targeted companies include four international companies in the variable compensation being paid, respectively) are same industry as Holcim with similar geographical set. The Group component of the variable compensa - spread and complexity, as well as the ten companies tion was set for senior management (without CEO), with the largest market capitalization in Switzerland, depending on the function and based on 100 percent therefore with companies of similar size and com - target objective achievement, between CHF 120,000 plexity. The benchmarking is based on position and and CHF 550,000, and for the CEO to CHF 1,100,000. responsibilities. In 2010, PricewaterhouseCoopers AG was consulted as external advisor for a fundamental For the year 2010, the operating EBITDA targets were and detailed review of the compensation system for set to 5 percent growth versus the previous year (Area the CEO and Executive Committee. The result of this Managers at achievement of the budgeted regional

review confirmed that the current system served operating EBITDA margin) and to 8 percent ROIC AT ,

robustly during the economic upswing and subse - both on a like-for-like basis. The ROIC AT target was quent crisis, and also offers a value-oriented compen - set based on the defined weighted average cost of

sation philosophy for the future. capital after tax (WACC AT ) of 8 percent. The minimum and maximum payout factors were set at ±20 percent The variable compensation comprises a Group-related for the operating EBITDA target (for Area Managers and an individual component. Assuming that all –2.5/+5 percentage points regional operating EBITDA

targets are achieved as per December 31 of the year, margin) and at ±3 percentage points for the ROIC AT the variable compensation for senior management target. In 2010, the operating EBITDA declined by (excluding the CEO), depending on the function –6.1 percent and the regional operating EBITDA concerned, accounts for between 45 percent and margin was above budgets by +1 percentage point on

90 percent of the base salary, and 92 percent for average, while ROIC AT reached 5.9 percent, all on a the CEO. For both components, a “target” amount is like-for-like basis. This corresponds to an achievement

106 107 GB_10_Remuneration_Report_e_S.106-117:GB_2010_Entschaedigungsbericht 8.4.2011 10:59 Uhr Seite 108 t r o p e R n o

i level of 55 percent (operating EBITDA; regional operat - tered shares of the company and a cash component t a r ing EBITDA margin 120 percent) respectively 30 per - of around 30 percent. The exercise price of the e n u cent (ROIC AT ). Senior management (without CEO) options corresponds to the stock market price at the m e

R achieved a payout factor of 48 percent and the CEO grant date. The options are restricted for a period of of 43 percent. The Group component is paid in the three years following the grant date and have an form of registered shares of the company, subject to overall maturity period of eight years. The options are a five-year sale and pledge restriction period, and a valued in accordance with the Black Scholes model cash component of approximately 30 percent. Allotted (input parameters are detailed on page 185). The com - shares are valued at the average market price in the pany reserves the underlying shares on the grant period from January 1, 2011, to February 15, 2011, and are date of the options as part of treasury stock or pur - either taken from treasury stock or are purchased chases them from the market. from the market. Pension scheme for senior management The individual component for senior management The base salary of senior management is insured in (without CEO), if all objectives are achieved as per a layered pension plan system, which includes the December 31, amounts to around 39 percent of the state-controlled social security schemes, i.e. AHV/IV, variable compensation, and for the CEO to 44 percent, the Holcim Pension Fund, the Holcim Supplementary and depends on the performance of the individual. Pension Fund and the Gemini Pension Fund. With the A range of quantitative and qualitative individual exception of the Swiss Federal AHV/IV and some local objectives is set for all members of senior manage - social security systems, all pension plans are defined ment depending on their roles and responsibilities. contribution plans offering benefits payable in the These measurable objectives are weighted and they form of retirement, disability, children, surviving relate to functional performance, strategic objectives, spouse and orphans’ pensions or equivalent lump operational objectives and specific project-related sums. objectives. For each objective, depending on target achievement, an achievement level in percent is The Governance, Nomination & Compensation Com - determined, resulting in a total achievement factor mittee has reviewed and determined the pension between 0 percent and 100 percent. In rare instances, scheme for senior management as of June 30, 2005, discretion may be used by the CEO (and by the Gover - and February 23, 2010. Accordingly, the pension nance, Nomination & Compensation Committee if scheme for Executive Committee members and the the CEO is concerned) to adjust the resulting achieve - CEO is targeted to achieve, at the retirement age of ment factor if unforeseeable events occurred, but in 62, based on 10 years of service in senior manage - no circumstances can this achievement factor exceed ment and 20 years of service with the Group, an 100 percent. In 2010, the CEO increased one senior amount of approximately 40 percent of the average manager’s achievement factor due to extraordinary of the last three annual base salaries, or 50 percent achievements. The total achievement factor is then for other senior managers, taking into account all multiplied by the targeted variable compensation pension schemes related to current and past occu- to determine the amount of the individual compo - pation, including state-controlled social security nent. For the year 2010, the individual component of schemes. Early or deferred retirement leads to adjust - the variable compensation, at 100 percent target ments based on actuarial calculations. achievement, was set for senior management (with - out CEO), depending on the function concerned, In the event of differences between the actual pension between CHF 90,000 and CHF 350,000 and for the fund benefits and the target pension, the Governance, CEO to CHF 850,000. The average target objective Nomination & Compensation Committee decides achievement and the payout factor for senior man - in view of forthcoming retirements about possible agement (without CEO) amounted to 86 percent and contributions in favor of the individual insurance for the CEO to 83 percent, respectively. The individual accounts. In July 2010, the Governance, Nomination & component is paid in the form of options on regis - Compensation Committee decided to grant an equal - GB_10_Remuneration_Report_e_S.106-117:GB_2010_Entschaedigungsbericht 8.4.2011 10:59 Uhr Seite 109

ization contribution in the total amount of CHF 8.8 Compensation for Board of Directors million. These contributions were made from the and senior management employer’s trust through the provisions in the Holcim The table shown on page 110 discloses the compensa - International Pension Trust, and have no impact on tion of the Board of Directors in 2010 in detail and the statement of income of the Group. those of the 15 members of senior management in aggregate as well as the highest amount attributed Employment contracts for senior management to a member of the senior management individually. The contracts of employment of senior management The amounts disclosed are based on the accrual prin - are concluded for an indefinite period of time and ciple and relate to 2010 performance. may be terminated with one year’s notice. Depending on the length of tenure with the Group, contracts In 2010, eleven non-executive members of the Board concluded before 2004 include severance compensa - of Directors received a total remuneration of CHF 2.9 tion amounting to one annual salary or two annual million (2009: 3.1) in the form of short-term employee salaries in the event of notice being given by the benefits of CHF 1.8 million (2009: 1.9), post-employ - company. More recent contracts of employment no ment benefits of CHF 0.1 million (2009: 0.1), share- longer include severance compensation. based payments of CHF 0.9 million (2009: 0.9) and other compensation of CHF 0.1 million (2009: 0.2). Upon appointment, members of the Executive Com - mittee may be granted a single allotment of options The total annual compensation for the 15 members on registered shares of the company by the Gover - of senior management (including CEO) amounted to nance, Nomination & Compensation Committee. It is CHF 36.7 million (2009: 27.2). This amount comprises a requirement that the members have been with the a base salary and a variable cash compensation of CHF Group for five years. The options are restricted for 18.2 million (2009: 16.7), share-based compensations of nine years and have a maturity period of twelve years. CHF 4.4 million (2009: 4.9), employer contributions to The company reserves the underlying shares as part pension plans of CHF 5.3 million (2009: 4.8) and“Others” of treasury stock or purchases them from the market. compensation of CHF 8.8 million (2009: 0.8) which Single allotments made during recent years are shown includes, according to the rules of SIX Swiss Exchange, on page 185 of this Annual Report. the contributions from the Holcim International Pension Trust for the additional financing of retirement benefits Options allotted upon appointment to the Executive in the amount of CHF 8.3 million. The CEO received a Committee are subject to forfeiture without compen - base salary plus variable compensation in cash of CHF sation, as long as they are restricted, if the Executive 2.5 million (2009: 2.5), share-based compensation of Committee member leaves the Group, except in the CHF 0.8 million (2009: 0.9), and employer contributions case of retirement, death or disability. Shares and to pension benefits of CHF 0.4 million (2009: 0.6). options received as part of the annual remuneration As a result, total compensation, before the additional may not be sold or pledged until the end of the contributions for the financing of retirement benefits, restriction period. If a member steps down from amounted to CHF 3.7 million (2009: 4). Including the senior management, the restriction period for shares additional contributions from the Holcim International and annually allocated options remains in force Pension Trust in the amount of CHF 5 million, based on without any adjustment in terms of duration. actuarial considerations and disclosed under “Others”, the CEO’s total compensation, in accordance with the rules of SIX Swiss Exchange, amounted to CHF 8.7 mil - lion (2009: 4). In accordance with Art. 663b bis of the Swiss Code of Obligations (transparency law), the base salary and the variable cash compensation are disclosed, including foreign withholding tax. Further included in the contribution to pension plans are the employers contributions to social security (AHV/IV).

108 109 GB_10_Remuneration_Report_e_S.106-117:GB_2010_Entschaedigungsbericht 8.4.201110:59UhrSeite110 Remuneration Report 8 7 6 5 4 3 2 1 t a e B d r o L e n i t s i r h C s a e r d n A f l o R N n o i t a s n e p m o C n i e l b a i r a V l a t o T n i e l b a i r a V s u k r a M (no-excutiv l a t o T t r e b o R r e t e i D g n a g f l o W s a m o h T . H n a i r d A r e t e P h c i r E a a “ x E r t s e r n I n I m e M n I n I a V h T C C em a h t O s o l l F H p m o t n e c r e p t n e c r e p o n n O c c c c i l e l w u l u l u l e u u l e n a c no r i o S a h s n a m r o N ss e H l l e . 8 c i r e n i d s e d n i d re k i z n u H d r a o B r o i n e s r e b n i d re f p ü K d e t n e f o n o i t 3 it l ä p S w re d a o L . F c a s e r nn a m r e k A g g m p m o a s yn i e h d i m h c S i g s n o v gn i d u R e h t t no i t a s n e p m o c no i t a s n e p m o c h t f o yr r e o p S re g n a w s n i B n i e h c e x e r i d a l l i i h t t re r ü h c S p f o f o e r e w o i n e s t l , n o i i r e t e h m u f o c e p o x e t a s n e tn e m e g a n a m e h s n at n a l P e s a b e s a b re l w o F i t u c .d o t s n e p o i o f t u r sr o t c e r i D ’ r o t n o p r a e y i mebrs) i h w d r a o B s n o l a v r r e v s e l s s i m t m u ” n o i r e h d e u 6 f e yr a l a s yr a l a s h c m e m g a n a i t u b s e e o c c a r e d n u o o f o B l a o d f l c n i I S t a f o t l r f o d r a e h , e c n a w o r e b X d r t n e m e o n , n m o s e d u t S r o i n e s / s r o t c e r i D i v e r g n i e h m e t i w 8 t f o o e h f a s f g a r e v a s s i s b u w e t l p i D t t c e f r e b m e M r e b m e M , e c n a n r e v o G , e c n a n r e v o G r e b m e M n a m r i a h C , e c n a n r e v o G r e b m e M y t u p e D , n a m r i a h C r e b m e M r e b m e M r e b m e M r e b m e M OE C e v i t u c e x E , e c n a n r e v o G no i t i s o P r e b m e M r e b m e M r e b m e M r e b m e M r e b m e M m e o t r e h t o y o c x E n i v i e c e r o t c e r e h t l o e r a y o l p l a r a i d r e B - g n e h t g n a h r a o e c s ’ B d n e p m o r a m y a l r e s r e r t s i s s d g c , n a m r i a h C k c t n e m e t a t a s o l c t s u , e a p m o c f o c i v e h t f o f o f o f o f o f o f o f o f o f o f o f o f o d n b i r t n o t e k r e b m e m S f o s e h t n a m r i a h C c e r i D s e l o h c e o f d e e h t e h t e h t e h t e h t e h t e h t e h t e h t e h t e h t e h t e h t n o i t a s s h g i h f e n e b o i n e e h t n o i t a n i m o N n o i t a n i m o N n o i t a n i m o N n o i t a n i m o N p r tn e m e g a n a m s e i n c i r n o e e h t o i t u t i d u A t i d u A d r a o B d r a o B d r a o B d r a o B d r a o B d r a o B d r a o B d r a o B d r a o B d r a o B d r a o B o m a r o t e t s e f o r t i d u A p . d o m n i a m , s t i o f a e g a , s s n r e b m e M m o c n i l a n o i t i d d f o o c s t n u r e h t C g a n 0 2 g o t f o .O E l e s n e p m e e t t i m m o C e e t t i m m o C e h t 4 8 1 f o f o f o f o f o f o f o f o f o f o f o t n e m n r e v o ee t t i m m o C 0 1 t a s n e p d o i r e p eh t i t n e m e e c n s r o t c e r i D s r o t c e r i D ,s r o t c e r i D ,s r o t c e r i D , s r o t c e r i D , s r o t c e r i D ,s r o t c e r i D , s r o t c e r i D sr o t c e r i D s r o t c e r i D sr o t c e r i D & & & & e h t d r a o B f o d n u d l u o w u l g n i c n a n i f 1 .n o i t a n o i f o n o i t a s n e p m o C n o i t a s n e p m o C n o i t a s n e p m o C n o i t a s n e p m o C e h t e d t r e m o r f e m i s i e h t r p p r G e r a h S “ s n a l f o e v a h d d l i h c a m i d e s o l c s i l i t n u e c n i s .p u o f o ec n i s l i t n u y r a u n a J t i d u A ,s r o t c e r i D r e b m e M r e b m e M r e b m e M i r .n o i t a c o l l a e t a t s ( f o d e t n u o m a , s t n e m y a p y l n o i t a s n e p m o c e h t y a M y a M t y a M e h y a M ee t t i m m o C s s o r g , 1 d l o n o i s n e p c e e t t i m m o C ee t t i m m o C ee t t i m m o C ee t t i m m o C n o , 6 02 f o f o f o , 6 , 7 e g a , 6 i t u b i r t f o 01 0 2 1 01 0 2 o t e h t e h t e h t . c t e 90 0 2 , 1 01 0 2 g n i d l o h h t i w d n a F H C o t f e n e b e h T .” n a l p n o b e F s r o v i v r u s 7 . 3 s s r e t e m a r a p , s t i y r a u r m o r f .n o i l l i m g n i d r o c c a t t 5 1 e h x a e c n a r u s n i , d n a l o H 02 r o f 1 m i c , 1 e e y o l p m e o t FH C FH C FH C re b m u N FH C FH C re b m u N re b m u N re b m u N re b m u N FH C re b m u N FH C re b m u N FH C FH C re b m u N re b m u N FH C re b m u N FH C re b m u N FH C FH C re b m u N FH C re b m u N FH C re b m u N FH C re b m u N re b m u N e h t d n a e h t n I i d / ] V H A [ r i a f n r e t e r a s e l u r e u l a v i t a a i c o s b u s n o f o b a s t c e j l a S a c l X I i l i i r u c e s P l u c l y t 64 9 , 3 1 6 , 5 1 e t S o n 74 6 , 0 9 7 , 1 s s i w 00 5 , 4 2 1 , 2 i n o i s i t a a e c n a r u s n 00 0 , 0 0 1 00 0 , 0 0 1 08 6 , 5 9 5 00 0 , 0 8 1 00 0 , 0 0 3 00 8 , 0 3 1 y t C e s a B i f 76 6 , 6 4 00 5 , 7 9 00 0 , 0 8 00 0 , 0 8 00 0 , 0 8 n o - e v hs a E o c r T a h c x f o a e y t s u i r t n yr a l a s a h s . e g n r ] V I [ n i t u b 5 l a s e r t e h , n o i e s e p n a n a t n u o m a . s s n d d n o i o i t p o l p d e n u f e g f o s n 76 6 , 6 4 8 se r a h S s d 04 3 , 2 1 76 6 , 6 4 00 0 , 0 8 00 0 , 0 8 00 0 , 0 8 00 0 , 0 8 00 0 , 0 8 00 0 , 0 8 00 0 , 0 8 00 0 , 0 8 00 0 , 0 8 00 0 , 0 8 66 1 , 1 66 1 , 1 66 1 , 1 66 1 , 1 66 1 , 1 66 1 , 1 66 1 , 1 66 1 , 1 66 1 , 1 66 1 , 1 ) 08 6 2 GB_10_Remuneration_Report_e_S.106-117:GB_2010_Entschaedigungsbericht 8.4.2011 10:59 Uhr Seite 111

Variable compensation Other compensation Total Total Cash Shares 2 Options 3 Employer Others 4 compensation compensation contributions 2010 2009 to pension plans

32,394 50,023 758,097 759,028

18,170 10,023 408,193 408,169

7,060 10,023 177,083 175,801

70,834

2,357 5,833 101,524

8,070 10,023 198,093 198,069

11,262 10,023 281,285 281,331

0 10,023 170,023 170,000

207,726

9,625 10,023 230,448 225,801

8,070 10,023 198,093 198,069

7,944 10,023 195,467 177,059

7,060 10,023 177,083 175,801

112,012 146,063 2,895,389 3,047,688 4,567 28,180 390,515 313,479 467,506 379,676 5,038,320 8,713,996 7 3,993,318

55.1% 28,848 145,063 2,614,863 1,980,127 2,406,611 5,260,900 8,786,016 36,662,463 27,221,571

44.8%

110 111 GB_10_Remuneration_Report_e_S.106-117:GB_2010_Entschaedigungsbericht 8.4.201110:59UhrSeite112 Remuneration Report l n a f t U o p t i f m o i m t a m t 2 a s B A s e r a h S s g n i d l o h e r a h S I n o i t a s n e p m o C c n t s i n o r o i e h o i o a h 1 0 m e g u q c o m t f r a a o e i t n t n m e m e e h r h t C n n a h t m d u l s s d e m 0, c i t r e s e r d r l i e F H c n n u o d r o n a ( e r i e e p x r e b r e b e b r t f e t n n e p i f G s e d e o i e h y d n e d n a n i o i n d a t d p 0 e f n a e f n o r s r t a t n , g o r f o 5 . s n n a t o c i D o o c a h s i t c n a - n a e o H p u o i o r f o f o f f e e j m s n o i t p o e o H C e r e p m s e r c c u e x h r a t t n g n o n d f a i o s t c c l h h f o n e s l i c l o t o t c h c s d r s e 2 u c h e e a m o o i l m i e d d n a l F r o f r t n u 1 0 d n r t n e , n i t s o B n i n 2 c i v i t e h h t r a i y . n r e a n a p . r o m e s 0, a p s t L e c t s r e m r o f 9 d n g o i t i n y n e r t a m e r a sn a o l n o i s n e e d e n w o h e . d r a s e o n i m t e m n e m e g a n a m i n r o w, e i v m u l e o i d s e o B o n e m l p m h t o o l p T i t c e d n n f o l l t p h t e p . m i h t n r a s s o e - o i n e e b m a c s n o i e r o n a e y y o s s r e b m e m D i r d o n c e x e o t e p m o c b y b s t m e h u r n n i d o o s e o s f e r t i f e n e g a l a t o p a w u s a t c e f r a m s r s e l i w o e h t t u e b m ’s .) l f D v n i t o n e m e f l o r o t s n e s e o h t r t e v i r i o l o H r f o t a p f m s r f - t e k d r a o B o t c e v l o a s n d e t s u t . i t r e h t u q e . , 9 5 s A o f o X I S d i e b m e m T d n a l a m i c m o c c f t d e n u r p m o s i h o i t v e l e r n o r o f , 4 1 7 g n i n r e v o g n i f o o t r r a t o B y t i ,s i w S r e d r a f o L a s n e p n t e e h t a t e n o o i n e s , d t e e r h r a t e g e h t e h 1 e s o m f i t n a sr o t c e r i D 4 6 s e s i s s n i r u c e r o d s r p r p a h c x e u o m a n e i t r a h t f o e m r o f c i d d a tn u Ex s i g e r o o ap m o r o f n o i t o f n i r a v i r p i b i h e f d g n a h c D a m s e i t re m se i d o b r ap i c h t fo re m r i a n o i t -e g n am r t n de r e t e ce de t dn a n yl e t - ro - - - ,e - l GB_10_Remuneration_Report_e_S.106-117:GB_2010_Entschaedigungsbericht 8.4.2011 10:59 Uhr Seite 113

Number of shares and options held by the Board of Directors 1 Name Position Total number Total number of shares 2010 of call options 2010 Rolf Soiron Chairman, Governance, Nomination & Compensation Committee Chairman 35,713 – Andreas von Planta Deputy Chairman 9,508 – Christine Binswanger Member 2,760 – Beat Hess Member 200 – Erich Hunziker Member 9,750 – Peter Küpfer Member, 37,000 2 Audit Committee Chairman 9,749 31,000 3 Adrian Loader Member 5,514 – Thomas Schmidheiny Member 59,568,933 – Wolfgang Schürer Member 42,454 – Dieter Spälti Member 21,404 – Robert F. Spoerry Member 8,179 – Total Board of Directors (non-executive members) 59,714,164 68,000

1 From allocation, shares are subject to a five-year sale and pledge restriction period. 2 Exercise price: CHF 70; Ratio 1:1; Style: American; Maturity: 19.8.2014. 3 Exercise price: CHF 80; Ratio 1:1; Style: American; Maturity: 12.11.2013.

Number of shares and options held by the Board of Directors 1 Name Position Total number Total number of shares 2009 of call options 2009 Rolf Soiron Chairman, Governance, Nomination & Compensation Committee Chairman 34,667 – Andreas von Planta Deputy Chairman 8,462 – Christine Binswanger Member 1,714 – Erich Hunziker Member 8,704 – Peter Küpfer Member, 83,288 2 Audit Committee Chairman 8,703 31,000 3 Adrian Loader Member 5,468 – H. Onno Ruding Member 4,595 – Thomas Schmidheiny Member 59,567,887 – Wolfgang Schürer Member 41,408 – Dieter Spälti Member 20,017 – Robert F. Spoerry Member 7,133 – Total Board of Directors (non-executive members) 59,708,758 114,288

1 From allocation, shares are subject to a five-year sale and pledge restriction period. 2 Exercise price: CHF 110; Ratio 1.0411:1; Style: European; Maturity: 21.5.2010. 3 Exercise price: CHF 80; Ratio 1:1; Style: American; Maturity: 12.11.2013.

112 113 GB_10_Remuneration_Report_e_S.106-117:GB_2010_Entschaedigungsbericht 8.4.201110:59UhrSeite114 Remuneration Report 1 l a t o T n a f e t S d n a l o R s e u q c a J s a e r d n A d r a r é G r e i v a J l l i B l i h p o e h T . H - t î o n e B s a m o h T l u a P k c i r t a P m o T s r U s u k r a M em a N r e b m u N l a t o T n a f e t S s e u q c a J d r a n r e B n a d i A s a e r d n A r e i v a J n a I l i h p o e h T d n a l o R . H - t î o n e B s a m o h T l u a P k c i r t a P s r U s u k r a M em a N r e b m u N o r F m ya r w k c a h T re v o s l o B ne l h ö B ne l h ö B re l b o t n e g u H re l b o t n e g u H hg u o l C r o i n e s r o i n e s l a e d e d ma n y L re g r e b s n e f l o W re g r e b s n e f l o W o l re i l l e t e L gr e b l o D gr e b l o D re l h ö K re l h ö K nn a m r e k A nn a m r e k A no g r u o B no g r u o B le f p ö n K le f p ö n K re v r e T f o f o ue L ue L i t a c ot i n e B ot i n e B . H . H hc o K hc o K s e r a h s s e r a h s , n o re t t a l h c S re t t a l h c S tn e m e g a n a m tn e m e g a n a m s e r a h s d n a d n a G v A s e r a h S t s s e r a h i n e a h t a s o r e s n o i t p o s n o i t p o f o l e s s e r p u o B r o j b u y D ’s a q c a a m t c e d n a i e r n a p m e c d a e r A a e r A a e r A r e b m e M e t a r o p r o C a e r A r e b m e M e v i t u c e x E no i t i s o P a e r A r e b m e M e v i t u c e x E no i t i s o P r e b m e M e t a r o p r o C r e b m e M r e b m e M r e b m e M r e b m e M a e r A a e r A r e b m e M r e b m e M r e b m e M r e b m e M r e b m e M r e b m e M e t a r o p r o C e t a r o p r o C e t a r o p r o C a e r A r e b m e M o H o t g a n i u d l e h d l e h o r s n o i t p o f c i t a e r c l e b D f re g a n a M r e g a n a M re g a n a M re g a n a M re g a n a M re g a n a M re g a n a M re g a n a M m e v i d m i p i i y b y b r c e r r a e y - e s a 1 3 a h n e f o f o f o f o f o f o f o f o f o f o f o f o f o f o f o t t L e h t e h t i o t , r e b m e M r e b m e M l a n o i t c n u F l a n o i t c n u F l a n o i t c n u F l a n o i t c n u F l a n o i t c n u F n o d e n w o . d 0 2 e r t e h t e h t e h t e h t e h t e h t e h t e h t e h t e h t e h t e h t e h t e h t e h t s r d n a e h T s r o i n e s r o i n e s 0 1 a i h d n a a a d n d l e v i t u c e x E e v i t u c e x E e v i t u c e x E e v i t u c e x E e v i t u c e x E e v i t u c e x E e v i t u c e x E e v i t u c e x E e v i t u c e x E e v i t u c e x E e v i t u c e x E e v i t u c e x E e v i t u c e x E e v i t u c e x E e v i t u c e x E d n , d n p o s h t a y b i f o i t c e t a r o p r o C f o f o t e o t r u g o t h tn e m e g a n a m tn e m e g a n a m o h s n m x e r o i n e s e re g a n a M re g a n a M re g a n a M re g a n a M re g a n a M e h t e h t a t e p o t e s e h t o e l c n i a n f o , e e t t i m m o C ee t t i m m o C d r a o B ee t t i m m o C d r a o B ee t t i m m o C , e e t t i m m o C ee t t i m m o C ee t t i m m o C ee t t i m m o C ee t t i m m o C ee t t i m m o C ee t t i m m o C ee t t i m m o C ee t t i m m o C , e e t t i m m o C ee t t i m m o C v i t u l a r h t a s r e e d u l c o l tn e m e g a n a m , 9 7 3 o i t e l a n o i t c n u F e m e t a c e - e m e m a e y n f o f o 4 3 0 s r e b m 1 1 m e h c s d o b r , s r o t c e r i D , s r o t c e r i D a n u d n t s i g e r h t r e b OF C O E C OF C s r e d n r p o n i re g a n a M . s e f o f -i r a e y - e SR G H de r e t eh OE C OE C a s e l t s e r s b u s r a h s f o r d l e h r u F u s e c i r v m r e h t r a t l s e i t b i r c a n o i s u o o t o a t o f o i r e p f e h t r o H o t y l e o s r a e e f o , d m i c l , e n o r a p a t c e p s e r f o f o 9 t l a t o T l a t o T . 8 , 6 7 p i c i t e h t p O s e r a h s s e r a h s g e r . d t L t i s n o i 1 3 d n e v s i 43 0 , 9 7 3 57 4 , 9 6 3 a r e b m u n r e b m u n l e e n O 65 1 , 0 1 72 6 , 9 5 59 0 , 7 1 65 2 , 5 1 92 4 , 9 8 63 8 , 6 5 02 7 , 0 7 11 5 , 3 7 50 5 , 0 1 34 9 , 5 1 39 4 , 1 3 23 1 , 8 1 25 0 , 3 1 84 4 , 5 2 74 8 , 3 8 48 2 , 4 3 93 2 , 8 2 45 2 , 3 2 o i t t .y s d e r e 09 5 , 6 11 4 , 7 41 7 , 7 62 2 , 1 98 5 , 1 77 7 , 4 20 8 , 6 29 0 , 7 83 4 , 6 55 4 , 9 20 2 , 7 68 3 , 5 90 0 2 01 0 2 r a h o n e r a f i t p o d n a e 2 r a h s 0,1 0 e u s s i i t p o o o c n e ; s n o i n e s m n e d f o f o f o a s n e p o s l t i t l o H r o l l a c l l a c e s e h t l y l e s e a m m i c l a t o T l a t o T s n o i t p o s n o i t p o n o i t e h t n o n e m e g a n e s i r a L e r .d t r e d l o h 58 6 , 0 9 8 13 8 , 6 7 9 e m e h c s 61 9 , 1 6 2 40 7 , 5 0 1 56 0 , 4 3 2 38 8 , 0 2 1 30 3 , 8 0 1 r e b m u n r e b m u n i g 81 6 , 6 1 69 8 , 9 9 10 8 , 9 6 56 9 , 4 1 80 9 , 6 1 62 7 , 7 1 06 9 , 0 2 92 0 , 1 4 95 0 , 4 1 49 8 , 7 1 90 6 , 3 5 38 7 , 6 1 42 1 , 3 9 13 5 , 2 1 33 6 , 9 8 39 6 , 3 5 33 1 , 4 9 88 6 , 3 8 58 8 , 8 1 54 5 , 8 5 27 7 , 3 8 05 5 , 3 3 42 1 , 9 91 7 , 5 s 90 0 2 01 0 2 s a e t e r a 0 t ot d s GB_10_Remuneration_Report_e_S.106-117:GB_2010_Entschaedigungsbericht 8.4.2011 10:59 Uhr Seite 115

Movements in the number of share options outstand - ing held by senior management are as follows:

Number 1 Number 1 2010 2009 January 1 890,685 550,003 Increase due to change in senior management 20,960 0 Decrease due to retirements 133,545 0 Granted and vested (individual component of variable compensation) 131,631 340,682 Granted and vested (single allotment) 67,100 0 Forfeited 00 Exercised 00 Lapsed 00 December 31 976,831 890,685 Of which exercisable at the end of the year 215,650 179,108

1 Adjusted to reflect former share splits and/or capital increases.

The share options outstanding held by senior management (including former members) at year-end have the following expiry dates and exercise prices:

Option grant date Expiry date Exercise price 1 Number 1 2002 2014 CHF 67.15 201,300 2003 2012 CHF 33.85 45,910 2003 2015 CHF 67.15 2 33,550 2004 2013 CHF 63.35 34,341 2004 2016 CHF 67.15 2 33,550 2005 2014 CHF 74.54 71,423 2006 2014 CHF 100.69 58,573 2007 2015 CHF 125.34 49,674 2008 2016 CHF 104.34 71,083 2008 2020 CHF 67.15 2 67,100 2009 2017 CHF 38.26 385,124 2010 2018 CHF 71.15 131,631 2010 2022 CHF 75.40 33,550 2010 2022 CHF 81.45 33,550 Total 1,250,359

1 Adjusted to reflect former share splits and/or capital increases. 2 Valued according to the single allocation in 2002.

Due to extraordinary trade restrictions in 2008, the expiry date of the annual options granted for the years 2003 to 2005 has been extended by one year.

In 2010, two new Executive Committee members have been granted in total 67,100 options.

114 115 GB_10_Remuneration_Report_e_S.106-117:GB_2010_Entschaedigungsbericht 8.4.201110:59UhrSeite116 Remuneration Report a H o m s H A r e h t O A s n a o L N m t w b o o n a t t e p r d o s s l o l o o r e n a n a h t o t e m a p t a c i c i c n e e i i d m o g a g a e m m p t r o n a m D s m d e t n a r g sn o i t c a s n a r t g n o t s a . e e e d t L n e p d t L o r e b s e m e c l k r i t f a o o t k c m e s e s r h t m . t e s s t n a s s n m e m a h a h r a m e b e o l c o l p n I . i t f o t m e o o t s e r s e r r n o h t s e y h t 1 3 k s r e b m e m l e m e m e b e p e t , w i ’s e o y t o l s o 0 2 o g f r s a r p l e r c e y s n a C n o s 0 1 e v o i a h F H e b a p a c e d f , e e t n r d e t s e s h t r e r r f i a h r f 0 s f o d x g n i m o . s o i n 2 . e r e , t m o o o t t e r g n i n r e v o g f 9 o h t t I h t b r a p m e m l l i m u p e w s m e m e o m l e e .s e i d r e b m e m o c t r h c r g a n a o l p e r s l o B n o i s e i n a o n s r e b d r a e s a s e e y y n a p o l c 0 0 2 ( d se i d o b n e m e s a o l f o r u p p f o y l e s f o a , n a l h c r u p s n d n D 9 e v o g o i n e s s a h c . t : c e r i o 0 t a l e r c l o H o T tu ) 1 9 . n er e h n i n r o t de s a se - h t r de sr mi e g GB_10_Remuneration_Report_e_S.106-117:GB_2010_Entschaedigungsbericht 8.4.2011 11:05 Uhr Seite 117

Strength. Performance. Passion.

Financial Information 2010 Holcim Ltd 54.indd 118 Financial Information the courseyear. of pricesfacedenergy upward pressure, whichintensified during raise interest rates.these measures, Despite commodity and the Groupin region AsiaPacific, whichforced central banksto The present hasresulted growth inhigherinflation, particularly cornerstone ofHolcim’san important success. broad geographic diversification hasonceagainprovento be since 2007,to record highervolumes. The Group’s strategy of from and, marketto benefit growth Holcim time for the first gram, initiated in2007andnowlargely completed, positioned the exception(with ofMexico). The capacityexpansion pro- emerging markets inAsia, Africa andLatin MiddleEast America theto the construction industryreturnedin inparticular the South.to As aresult,the AmericasfromNorth growth haveglobal growth shifted fromthe the East,Westto andin the worldeconomyAlthough stabilized in 2010,the drivers of Overview the Groupon regions andbusinessperformance. thereto. contain reports The quarterly additionalinformation regions,the consolidated financialstatementsthe notes and the shareholders’ letter, forthe individualreports the Group and results ofoperations shouldberead inconjunction with the Group’sThis discussionandanalysisof financialcondition previous year’s level. well ashigherdistributioncosts, operating EBITDAthe nearlyequaled Eventhough Holcimfaced pricingpressure insomeleadingmarkets, as the Group2007 experienced increasing demandfor buildingmaterials. a very strong footing –showedsubstantial growth.time since For the first year.this, Despite the emerging many markets of –inwhichHolcimhas the year halfof slightly weakenedthe first towardthe signals in theendof 2010 was marked byvolatilitythe construction sector; in the positive discussionandanalysis 2010 Management ities by CHF 245million. ities byCHF 264million,EBITDA byCHF andcashflowfrom operating activ- tion, 1,662million, salesincreased in2010net byCHF operating consolidation 1, asofOctober 2009.this acquisi- Asaresult of method for Cement Australia fromto afull aproportionate increased fromto75percent, 50 the consolidation changing this acquisition, Holcim’s shareholding inCement Australia ing its25percent interest inCement Australia. Asaresult of capital ofHolcimAustralia (formerly Cemex Australia), includ- 1,On October 2009, Holcimacquiredthe share 100percent of centageto 20.8 points percent (2009: 21.9)year-on-year. improved. Overall,the operating EBITDA margin fell by1.1per- only slightly lower.the aggregates Inthemargin even segment these measures,to Due the operating EBITDA margin was severelywere most impacted by continued weakdemand. year,the greatest efforts werethe Group madeinregionsthat business areas andacrossthewholeGroup. the previous Asin year’s levelthrough amajorsavings exercise conducted inall exceeded itsguidelineofkeeping fixedthe previous costs at to aremarkableamounted 312million. CHF Holcimsubstantially to quarter. from quarter reducedthem further reductionThe net its fixed costs steadyonayear-on-year andlike-for-like basis, but capacity,new cement onlyinkeepingthe Group succeedednot seventhe commissioningtonnes ofDespite ofabout million couldHolcim successfullymanagedfactors influencedirectly. it 07.04.2011 14:32:00 Operating results Sales volumes and principal key figures January–December (12 months) October–December (3 months)

2010 2009 ±% ±% 2010 2009 ±% ±% MD & A like-for- like-for- like like Sales of cement in million t 136.7 131.9 +3.6 +2.4 33.9 32.8 +3.4 +3.0 – of which mature markets in million t 31.5 29.5 +6.8 +0.7 7.5 7.2 +4.2 +4.2 – of which emerging markets in million t 105.2 102.4 +2.7 +2.9 26.4 25.6 +3.1 +2.7 Sales of aggregates in million t 157.9 143.4 +10.1 –1.6 39.1 40.2 –2.7 –3.2 – of which mature markets in million t 131.8 117.5 +12.2 –2.0 32.0 33.9 –5.6 –5.3 – of which emerging markets in million t 26.1 25.9 +0.8 +0.4 7.1 6.3 +12.7 +7.7 Sales of ready-mix concrete in million m3 45.9 41.8 +9.8 +0.2 11.5 11.4 +0.9 +0.9 – of which mature markets in million m3 25.5 22.1 +15.4 –3.2 6.0 6.4 –6.3 –5.4 – of which emerging markets in million m3 20.4 19.7 +3.6 +4.1 5.5 5.0 +10.0 +8.9 Sales of asphalt in million t 10.6 11.0 –3.6 –3.6 2.8 2.9 –3.4 –3.4

Net sales in million CHF 21,653 21,132 +2.5 –2.1 5,085 5,358 –5.1 –1.6 – of which mature markets in million CHF 10,656 10,063 +5.9 –4.6 2,462 2,709 –9.1 –5.8 – of which emerging markets in million CHF 10,997 11,069 –0.7 +0.1 2,623 2,649 –1.0 +2.7 Operating EBITDA 4,513 4,630 –2.5 –6.1 936 1,016 –7.9 –4.2 – of which mature markets in million CHF 1,522 1,377 +10.5 –3.5 330 324 +1.9 +3.5 – of which emerging markets in million CHF 2,991 3,253 –8.1 –7.2 606 692 –12.4 –7.8 Operating EBITDA margin in % 20.8 21.9 18.4 19.0 Operating profit in million CHF 2,619 2,781 –5.8 –10.1 441 444 –0.7 +2.5 Net income in million CHF 1,621 1,958 –17.2 –18.2 398 381 +4.5 +6.6 Net income – shareholders of Holcim Ltd – in million CHF 1,182 1,471 –19.6 –21.1 307 271 +13.3 +15.1 Cash flow from operating activities in million CHF 3,659 3,888 –5.9 –8.3 1,606 1,696 –5.3 –2.6

The continued uncertainty in the economic situation was continue to provide high levels of liquidity. Although the period reflected in the currency market. The Swiss franc appreciated of comparatively low interest rates continues, they edged up in throughout 2010, causing a significant negative impact on the second half of the year reflecting recurring fears of infla- the trans lation of some local financial statements. The pound tion. Holcim continues to have a very solid balance sheet and sterling, US dollar, and in particular the euro depreciated mate- strong liquidity. In 2010 Holcim refinanced CHF 548 million in rially against the Swiss franc. A compensating effect had the the capital markets. increase of the average exchange rates of the Canadian and Australian dollar, the Mexican peso, as well as the Asian curren- Sales volumes cies, so that on balance the currency effect on operating EBITDA The quarterly key figures are subject to seasonal fluctuations, was only –0.5 percent (2009: –7.4). in particular in Europe and North America. Local weather conditions often varied considerably from quarter to quarter and The combined effect of the changes in the scope of consolida- must be taken into account when evaluating these figures. tion and currency increased net sales by a total of CHF 965 million, operating EBITDA by CHF 167 million, and cash flow from In the fourth quarter, cement sales volume increased by 3.4 per- operating activities by CHF 94 million. cent, or 1.1 million tonnes, to 33.9 million tonnes. On a like-for- like basis, the increase amounted to 3 percent or 1 million tonnes. The situation in the financial markets has normalized. As the The largest increases were recorded by Holcim US and the two prospects for the real economy remain uncertain, central banks Indian Group companies.

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54.indd 119 07.04.2011 14:32:00 54.indd 120 Financial Information the cement segment,the cement the previousthan in quarter. lessso but Price pressures remainedthe fourth quarter, in in particularly basis,there 86million. was adeclineofonly1.6percent orCHF 228million.accounted percent orCHF for Onalike-for-like 4.3 tions arethe mainreasons forthis negative development and lion comparedthe prioryear.to Strong exchange rate fluctua- 5,085 mil- to CHF salesdecreasedpercentFourth-quarter by5.1 Total Group Corporate/Eliminations Asia Pacific Africa MiddleEast Latin America North America Europe Million CHF byregion sales Net Net sales the fundamentallywas healthyto the state mainlydue of comparedthe previous with year onalike-for-like basis. This tonnes million weresales ofcement up3.6percent or2.4 tonnes. percent million or0.4 Group4.5 region AsiaPacific’s Africa recorded MiddleEast anincrease salesof incement marginally percent by0.4 or0.1tonnes. million Group region volume inBrazil, inLatin salesofcement Americadeclined tonnes,to HolcimUS. primarilydue Despitehighersales volume Americarose by3.7percent inNorth million or0.4 the economic hard bydownturn.was particularly hit Sales to winter. the earlystart weak demandand Eastern Europe sales fell by3.3percent or0.9tonnes onpersistently million tonnes. percent or3.2million the Group Inregion2.4 Europe, tonnes,to 136.7million whichincludedlike-for-like of growth Forthe fullyear 2010, salesvolume cement rose by3.6percent higher salesvolumes. year-on-year. Asidefrom Europe, allGroup regions posted concrete were delivered, anincrease of0.1 millioncubicmeters quarter,the last In 11.5millioncubicmetersofready-mix to increase salesofaggregates, namelyby10.3 percent. tonnes.1.3 million OnlyGroup region Latin Americamanaged On alike-for-like basis,the decrease to 3.2percent amounted or ter, resulting inadecreasetonnes. of2.7percent or1.1million Aggregates salesvolume was slightly quar- negativethe last in January–December (12months) 1632,3 25–. ,8 ,5 51–1.6 –5.1 5,358 5,085 –2.1 +2.5 21,132 21,653 ,9 ,0 90+. 4 8 1. –2.8 –13.8 289 249 +2.5 –9.0 1,206 1,098 ,5 ,1 2. 16198180+. +1.4 +3.1 1,880 1,938 +1.6 +24.0 6,418 7,958 ,3 ,2 1. 55139166–55–6.3 –15.5 1,656 1,399 –5.5 –10.7 7,320 6,535 ,4 ,4 28+. 5 2 41+6.7 –4.7 +4.1 –7.4 821 854 855 791 +1.6 –6.6 +2.8 –6.9 3,348 3,480 3,442 3,240 60 (640) (620) 0020 %±% ±% 2009 2010 East maintainedEast salesvolumesthe previous at year’s level. by 0.6 millioncubicmeters. The Group region Africa Middle Latin millioncubicmetersaswell AsiaPacific Americaby0.4 sales ofready-mix concrete by0.1 millioncubicmetersasdid hard byovercapacity initsmarket. Americaincreased North hit or1.1millioncubicmetersasSpainwascent particularly the Group regions, onlyEurope adeclineof6.5per- reported to 0.2amounted percent or0.1 millioncubicmeters. Among millioncubicmeters.45.9 Onalike-for-like basis,the increase Ready-mix concrete salesvolume grewto by9.8percent tonnes. percent million or0.4 3.4 region Latin Americasalesexceededthe previous year by by3.8 percentMiddle East or0.1tonnes. million the Group In tonnes, Americaby2.5percent or1million North andinAfrica sales inEuropetonnes, declinedby1.7percent or1.3million in remained relatively stable. Onalike-for-like basis, aggregates tonnes,sales by16million volumesthe otherGroup inregions time afull-year consolidation ofHolcimAustralia, increased the Group region AsiaPacific, whichwas for reporting the first- aggregatestonnes. declinedby1.6percent or2.3million While Adjusted forthe scope changesinofconsolidation, salesof Aggregates volume rose by10.1to 157.9 percent tonnes. million On alike-for-like basis, 444mil- adecrease of2.1percent orCHF 21,653million. salesincreasedto CHF In 2010net by2.5percent for-like basis. the otherGroupwhile regions lower salesonalike- reported like-for-like percent, of6.7percent growth and1.4 respectively, the fourth quarter,In Latin AmericaandAsiaPacific achieved well as the newadditionalcapacityavailable.well as construction markets, inIndiaand inparticular Thailand, as like-for- like October–December (3months) 17 (142) (147) 0020 %±% ±% 2009 2010 like-for- 07.04.2011 14:32:00 like lion was experienced. In Europe, net sales fell by 5.5 percent or Compared with the previous year, there was a slight shift in the CHF 399 million. In particular, Eastern Europe, France Benelux regional contribution to overall 2010 net sales. The breakdown and Spain posted lower sales. In North America net sales fell by was as follows: Europe 29.3 percent (2009: 33.6), North America

6.6 percent or CHF 229 million on a like-for-like basis, primarily 14.6 percent (2009: 16), Latin America 15.5 percent (2009: 15.4), MD & A due to greater pressure on prices and the lower activities in Africa Middle East 4.9 percent (2009: 5.5), and Asia Pacific construction and paving in Las Vegas. Latin America reported 35.7 percent (2009: 29.5). on a like-for-like basis an increase of 1.6 percent or CHF 53 million, with the major contribution from Brazil. Africa Middle East The purchase of Holcim Australia in 2009 caused the percent- recorded sales growth of 2.5 percent or CHF 30 million on a age of the net sales generated from emerging and mature like-for-like basis. Overall net sales in Asia Pacific increased markets to shift slightly in 2010: The emerging markets by 24 percent or CHF 1,540 million. This improvement is primar- accounted for 50.8 percent (2009: 52.4) of Group sales and ily a reflection of the consolidation of the Australian Group mature markets for 49.2 percent (2009: 47.6). companies; on a like-for-like basis the increase is 1.6 percent.

Operating EBITDA Operating EBITDA by region January–December (12 months) October–December (3 months) Million CHF 2010 2009 ±% ±% 2010 2009 ±% ±% like-for- like-for- like like Europe 1,045 1,232 –15.2 –10.8 190 197 –3.6 +6.1 North America 460 400 +15.0 +14.3 94 72 +30.6 +34.7 Latin America 999 1,076 –7.2 –7.5 237 258 –8.1 –5.0 Africa Middle East 359 373 –3.8 +5.4 73 94 –22.3 –12.8 Asia Pacific 1,820 1,760 +3.4 –10.8 381 454 –16.1 –17.2 Corporate/Eliminations (170) (211) (39) (59) Total Group 4,513 4,630 –2.5 –6.1 936 1,016 –7.9 –4.2

Compared with the fourth quarter in the previous year, operat- Due to rigorous cost management and despite the capacity ing EBITDA fell by 7.9 percent to CHF 936 million. Currency expansion of about seven million tonnes, Holcim saved on fluctuations reduced operating EBITDA by CHF 42 million or a like-for-like basis CHF 312 million in fixed costs in 2010 and 4.1 percent. On a like-for-like basis, the Group experienced a substantially exceeded its guideline of maintaining fixed costs decline of 4.2 percent or CHF 43 million as a result of substan- at the previous year’s level. As a result of reduced demand

tially higher variable costs per unit. In particular rising fuel in Europe, CO2 emissions certificates were sold for a total costs had a negative impact on the variable costs. However, amount of CHF 95 million compared to proceeds in 2009 of compared with the previous period, fixed costs were reduced by CHF 90 million. CHF 122 million. Whereas Europe and North America posted higher operating EBITDA on a like-for-like basis, the change in Despite higher variable costs, production costs as a percentage other Group regions was negative year-on-year. of net sales increased only by 0.1 percentage points to 57.2 percent of net sales, due to the aforementioned savings in fixed Due to Holcim’s geographic diversification and the contribution costs. As a percentage of net sales, distribution and selling from the acquisition in Australia, operating EBITDA remained expenses increased from 22.8 percent in the previous year to at a solid level compared with the previous year. For the full 24.4 percent. This increase is a result of higher transport costs, year under review, operating EBITDA declined by 2.5 percent or caused by higher fuel costs and longer distribution routes, CHF 117 million to CHF 4,513 million. On a like-for-like basis, especially in the US and India. As a percentage of net sales, operating EBITDA fell by 6.1 percent or CHF 284 million. administrative expenses decreased significantly by 0.5 percentage points to 6.4 percent of sales.

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54.indd 121 07.04.2011 14:32:00 54.indd 122 Financial Information points to 1.9percent. points materials contracted segment andservices by1.3percentage the margins. on impact the otherconstructionThe margin in 17.8to 22.9percent. percent Lower fixed costs hadapositive to 23.5percent, cent whileaggregates margins increased from segment,the cement In EBITDA margins per- declinedfrom 25.1 America.Europe andNorth Africa andAsiaPacific, MiddleEast whereasthey increased in Margins declinedyear-on-yearthe Group inregions Latin America, cent, or0.6 percentage points,the previousthan in year. lower the fourth quarter,In the operating EBITDA per- margin was 18.4 Operating EBITDA margin markets for 33.7percent (2009: 29.7). 66.3 percent (2009: 70.3) ofoperating EBITDA andmature the year underreview,the emerging markets accounted for the acquisitionofHolcimAustraliaas aresult of in2009. In mature markets comparedthe previous with year, primarily There wasthe weighting ashift betweenemerging in and 7.7), andAsiaPacific 38.9percent (2009: 36.4). 21.3 percent (2009: 22.2), Africa 7.7 MiddleEast percent (2009: America9.8percent (2009: North 25.4), 8.3), Latin America Europe contributedto operating 22.3percent EBITDA (2009: Pacific,the inclusionofHolcimAustralia. becauseof In2010 operating EBITDAthe Group changedprimarily inregion Asia Comparedthe previous with year,the regional weighting of production costs. 190million.or CHF ACC inIndiasuffered from highervariable 20million.CHF InAsiaPacific decreased it by10.8 percent Group percent region or Africa increased MiddleEast by5.4 and Colombia. Driven byhighervolumes, operating EBITDA in generated positive changes, whileoperating EBITDA fell inMexico decreased by7.5 81million. percent orCHF Brazil andArgentina 57million. percent orCHF InLatin Americaoperating14.3 EBITDA efficiencies.and cost Asaresult, operating EBITDA increased by to sharplyimproveon stream possible in2009andmadeit energy the newSte.to due Genevievepart plant, cement whichcame andsubstantial segment the cement savings. cost in This was in Falling Americawere offset pricesinNorth byhighervolumes enced asharpdeclineinvolumesthrough andpricesallregions. forthis decrease resided mainlyinEastern Europe, whichexperi- operating EBITDA of10.8 133million. percent orCHF The reason On alike-for-like basis, Group region Europe postedadrop in plants in the USandIndia. plants in the newto 45milliondue and higherdepreciation ofCHF wasthe loweroperating aresult of 117million EBITDA ofCHF declined by10.1 281million. percent orCHF total decreaseThe 2,619million.CHF Onalike-for-like basis, operating profit Forthe year asawhole, operating fell profit to percent by5.8 was offset from byapositive lowerdepreciation. impact 11million.by 2.5percent orCHF The loweroperating EBITDA 15million.CHF Onalike-for-like basis, operating improved profit Negative currency developments reduced operating by profit in2009. 441millioncomparedthe samequarter with to CHF the fourth quarter,In operating declinedby0.7 profit percent Operating profit this segment,In allGroup regions narrower reported margins. 0.9 percentagetarget:to 2.8percent points (Holcim >8percent). construction materials contracted segment andservices by this segment.higher margins in the otherThe margin in of Latin AmericaandAsiaPacific, allGroup regions reported target:to 21.2percent (Holcim >27percent). Withthe exception aggregates segment,the margin edgedup1.5percentage points Africa were MiddleEast to increasetheir margins. able the In target:26.9 percent (Holcim >33percent). Americaand North 1.5 percentagethe previous percent in points yearto from 28.4 segment,the cement In the operating EBITDA margin fell by mainly onaccount ofACC andgenerally highervariable costs. the AsiaPacificMargins in region fell by3.3percentage points, couldMiddle East improve itsmargins by0.9 percentage points. environment andhighercosts inMexico, alsobecauseof but points,the deteriorationto the market in owinginparticular fixed costs. Margins inLatin Americafell by2.8percentage 2.6 percentage points,the substantial cutsinto attributable operating EBITDA Americaimproved margins inNorth by decreasing volumes andprices. Despitelowersellingprices, Europe of0.9 percentage points was strongly influencedby down by0.9 percentage points. The reduction inGroup region to 20.8 percent. Onalike-for-like basis,the EBITDA margin was the Group decreased by1.1percentage points from 21.9percent Forthe year asawhole,the operating EBITDA margin across increased pricingpressure inColombia. Group region Africa 07.04.2011 14:32:00 Group net income In the fourth quarter, Group net income rose to CHF 398 million from CHF 381 million one year previously, confirming the posi-

tive trend. For the year as a whole, Group net income fell by MD & A 17.2 percent or CHF 337 million to CHF 1,621 million. On a like- for-like basis the decrease was 18.2 percent.

The decrease in Group net income is a consequence of lower operating profit and a number of non-recurring items. Lower income contributions from associated companies were offset in part by an increase of CHF 89 million in financial income, which is primarily attributable to the change in fair value of a receivable (notes 12 and 21, on pages 160 and 164).

In 2010, the effective tax rate was 27.5 percent (2009: 24.1). The tax rate for the past financial year was affected by a non-recurring, cash-neutral tax charge in connection with the internal transfer of the investment in Holcim (Canada) Inc.

Group net income – attributable to shareholders of Holcim Ltd – declined by 19.6 percent or CHF 289 million to CHF 1,182 million. Their share was 72.9 percent of Group net income, compared with 75.1 percent in the previous year. The decrease is mainly attributable to the profit contributions of Cement Australia (fully consolidated since October 1, 2009, reporting 25 percent non-controlling interests). On a like-for-like basis net income attributable to Holcim shareholders decreased by 21.1 percent. Earnings per Holcim Ltd share fell by 25.2 percent from CHF 4.93 in the previous year to CHF 3.69. The decline is attributable in part to new shares issued in 2009.

Given the adverse economic environment, the successful performance is primarily attributable to consistent cost-cutting measures.

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54.indd 123 07.04.2011 14:32:00 54.indd 124 Financial Information (De)Increase incashandequivalents Cash flowfromfinancingactivities(excl.dividends) Financing surplus(requirement) Dividends paid Financial di(in)vestmentsnet Investments inproperty,plantandequipmentforexpansion Free cashflow to maintainproductivecapacityandsecurecompetitiveness Net capitalexpendituresonproperty,plantandequipment Cash flowfromoperatingactivities Million CHF Cash flow Financing activities,investmentsandliquidity market inAustralia. Further information oninvestments in review, allsegments ofHolcim’s benefitedfromthe activities acquisition ofHolcimAustralia. Asaresult,the year in under the previousIn year, financial investments containedthe 1,362million. 3,068to CHF decreased million activities byCHF the financialyearIn underreview, cashflowusedininvesting Cemex Australia) 2009. inOctober the purchase ofHolcimAustraliato attributable (formerly 1,932millionyear-on-year.CHF The changewas primarily 544millionrepresentedof CHF adecrease of 78percent or the fourth quarter,In cashflowusedin investing activities Investment activities cash flowmargin achieved was 16.9percent (2009: 18.4). offsettax refunds.partially by the year In underreview,the workingcapital,higher net andhigherinterest charges were or 8.3percent. Lower operating EBITDA, from anadverse impact On alike-for-like basis,there 323million was adecrease ofCHF million. 3,659 to CHF percent 229millionor5.9 declined byCHF the yearIn underreview, cashflowfrom operating activities working capital. tax payments,of offset partially byfavorable changesinnet EBITDA,the decreasethe scheduling to ismainlyattributable 44million.fell byCHF Asidefromthechangeinoperating On alike-for-like basis,the cashflowfrom operating activities 47Currency fluctuations million. hadanegative ofCHF impact 1,606millionyear-on-year.to CHF 90million decreased byCHF the fourth quarter,In the cashflowfrom operating activities Cash flowfrom operating activities aur–eebr(2mnh)October–December(3months) January–December (12months) the moderni zation plants ofcement inAzerbaijan andMorocco. expansionthe emerging market ofcapacitiesinIndiaand current investmentimportant the systematic projects include Group’s overall andenvironmental cost efficiency. The most technology, with cutting-edge improveto further theythe help with Latin America.the newoperations Asall are equipped came onstream, market ofIndiaalongthe growth in ofit most year underreview, seven capacitytonnes ofcement million capacityinexistingcement andnewmarkets. Allinall,the in of which were part the completionto ofseveralable primarily plants, cement represents adecrease of31percent. This decrease isattribut- paredthe previous with year’s 2,305million, figure ofCHF this 1,592millioninproduction andotherfixed assets.CHF Com- the financialyearIn underreview, Holciminvested anet Annual Report. financial assetscanbefoundthis onpages151and152of 112 199 3. 32 49 +31.3 (469) (322) +38.7 (1,929) (1,182) 251 ,8 216(,6)(2)–149.4 (425) (1,060) –281.6 1,388 (2,521) ,4 ,1 75140151–5.4 1,501 1,420 –7.5 3,512 3,249 ,7 74 350101(9)+230.3 (799) 1,041 +315.0 (734) 1,578 ,5 ,8 59166166–5.3 1,696 1,606 –5.9 3,888 3,659 93 5 242(9 124 +98.4 (1,224) (19) –244.2 654 (943) 79 12 245(1 1)–10.5 (19) (21) –274.5 (192) (719) 40 36 90(8)(9)+4.6 (195) (186) –9.0 (376) (410) 0020 %21 09±% 2009 2010 ±% 2009 2010 3 215 108(6 182 +98.0 (1,812) (36) +110.8 (2,125) 230 the strategic expansion programto increase 07.04.2011 14:32:00 Major investment and divestment projects Morocco – rationalization Shurovo – capacity expansion in Russia The work on doubling of the clinker capacity at the Fès plant is In order to create a stable Russian base called for in Holcim’s proceeding on schedule. The plant will come on stream in the

fundamental strategy, work began on the modernization and first quarter of 2012. The investment will generate savings in MD & A expansion of the cement plant in Shurovo, near Moscow, in the field of logistics, cut production costs, and improve Holcim’s the first quarter of 2007. First clinker production started in the positioning for a growth market in the future. fourth quarter of 2010. This has doubled annual capacity to 2.1 million tonnes of cement and enables Holcim to participate Investments in rationalizing and improving processes in in Russia’s vigorous long-term economic growth. At the same environmental and occupational health and safety measures time, the modernization of the plant is a major contribution to amounted to CHF 639 million (2009: 578). better environmental and workplace safety. On September 4, 2010, Holcim signed a settlement with the Hermosillo – new cement plant in Mexico Bolivarian Republic of Venezuela agreeing on the terms for At the end of 2010 the new cement plant near Hermosillo in Venezuela’s compensation payment for the June 2008 nation- Northwestern Mexico with an annual capacity of 1.6 million alization of Holcim (Venezuela) C.A. and the suspension of the tonnes came on stream. The new plant will be the ideal com- international arbitration procedure currently pending before plement to the existing production network in Mexico and will the International Centre for Settlement of Investment Disputes further strengthen the position of Holcim Apasco. (ICSID) in connection with that nationalization. The agreed total compensation amount is USD 650 million, of which the India – expanding our market position first payment in the amount of USD 260 million was received The two Indian companies, ACC and Ambuja Cements, success- on September 10, 2010. The remaining compensation amount fully completed a number of capacity expansion projects in of USD 390 million will be paid in four equal yearly install- 2010. This additional capacity will be fully employed in 2011 and ments. The resulting change in fair value totals USD 410 mil- help Holcim to strengthen its position in the rapidly growing lion, of which USD 164 million was realized in 2010. Indian market.

Group ROICBT

Azerbaijan – modernization The Group return on invested capital before tax (ROICBT) As part of the long-term growth strategy for the region, measures the profitability of the capital employed. It is regarded Garadagh Cement plant is being modernized in a program as a measure of operating profitability. It is calculated by spanning approximately two years. The central element of the expressing EBIT as a percentage of the average invested capital modernization is the replacement of the existing wet-process (excluding cash and marketable securities). with a dry-process kiln line. This will reduce energy require-

ments and improve efficiency. Besides the modernization of the Group ROICBT production process, the program is also focused on improving Million CHF

1 the plant’s environmental compatibility by reducing the level of EBIT Invested capital ROICBT in % emissions. The modernized plant is scheduled to come on Previous Business Average stream in the third quarter of 2011. year year 2010 3,054 38,438 35,040 36,739 8.3 Colombia – expanding cement capacity 2009 3,371 35,371 38,438 36,905 9.1 Starting from the second half of 2010, a new cement mill came 1 Earnings before interest and taxes. into operation in the Nobsa plant, with additional annual capacity of 0.7 million tonnes of cement. The new grinding line allows operating with a comprehensive system of cement production, from raw material preparation to storage and ship- ping. With the project in operation, Holcim Colombia is in a position to address all sectors of construction, providing structured and specific solutions to align their products with the needs of a developing market.

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54.indd 125 07.04.2011 14:32:00 54.indd 126 Financial Information net financialdebt. net fellthe levelthe sharpreduction in mainlyasaresult of of holders’ equity(gearing)was 53.8percent (2009: 62.8). Gearing the endof2010,At to share-the ratio financialdebt ofnet depreciation ofvarious currencies versusthe Swiss franc. from operating activities, lowercapital expenditures,the and to cashflow 11,363milliondue to CHF million 13,833 from CHF the 2010financialyear,In fell financialdebt significantly net financialdebt Net HolcimCapital(Thailand)Ltd.bondwith 2,000million THB HolcimLtdbondwithafixedinterestrate 475million CHF financialyear,the last In the ROIC significant bonds issued: significant existing borrowings.the following Mention shouldbemadeof capital was raisedto fundinvestments andrefinance/repay Aside from cashflowfrom operating activities, additionaldebt Financing activity three years,to invested ischarged capitalimmediately. to affect incometo afterstarts two aconstruction phaseof slightly reduced. The investment activity, whichnormallyonly the decreaseto inEBIT, alsoaverage but invested capitalwas the financialyear in underreviewment ismostlyattributable points fromto 8.3percent. 9.1percent The negative develop- 2010–2015. GuaranteedbyHolcimLtd. a fixedinterestrateof3.52%andterm of 2.375%andaterm2010–2016. BT fell by0.8 percentage 10,000 Total shareholders’ equity, net financial debt and gearing and debt financial net equity, Total shareholders’ kets mature over 12months.the next 652millionbondsandprivateCHF placements incapitalmar- years). rangetarget target:the (Holcim the lowerendof 4–6 years,At 4.2 the average maturity offinancialliabilitiesisat nication withinvestors andbanks. vidual lenders. Holcimfosters regular contact andopencommu- and otherlenders. There are positionswithindi- nosignificant vate placements onpages 173and174) and30percent bybanks capital markets (seeoverview ofalloutstandingbondsandpri- the financial liabilitiesarethrough of cent financedvarious Holcim wasto maintain itsstrong able financialprofile: 70per- profile Financing 20,000 15,000 25,000 Million CHF 5,000 Gearing (right scale) Gearing (right financialdebt Net Shareholders’ equity 0 31.12.2009 31.12.2010 07.04.2011 14:32:00 30% 20% 40% 50% 60% 70% 80% 10% 0% Maturity profile of total financial liabilities1 Million CHF

3,500 MD & A

3,000

2,500

2,000

1,500

1,000

500

0 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 >2020

Loans from financial institutions and other financial liabilities Bonds and private placements

Holcim attaches great importance to a favorable credit rating the basis of clearly defined principles as part of the risk manage- and, therefore, gives corresponding priority to achieving its ment process. As of December 31, 2010, Holcim also had unuti- financial targets and retaining its solid investment grade rat- lized credit lines amounting to CHF 8,867 million (2009: 8,188) ing. Detailed information on the credit ratings can be found on (see also page 171). This includes unused committed credit lines pages 39, 146 and 147 of this Annual Report. Holcim improved of CHF 6,378 million (2009: 5,365). Existing borrowings1 of its financial targets to retain a solid investment grade rating. CHF 2,318 million (2009: 3,334) maturing in the next 12 months The ratio of funds from operations (FFO) to net financial debt are covered by existing cash and cash equivalents and unuti- improved to 31.3 percent (Holcim target: >25 percent) and the lized, committed credit lines. ratio of net financial debt to EBITDA to 2.3 (Holcim target: <2.8). The EBITDA net interest coverage reached 6.1x (Holcim target: Currency sensitivity >5x) and the EBIT net interest coverage 3.7x (Holcim target: >3x). The Group operates in around 70 countries, generating by far the largest part of its results in currencies other than the Swiss Due to the depreciation of the US dollar and the euro versus franc. Only about 3 percent of net sales are generated in Swiss the Swiss franc, the proportion of US dollar- and euro-denomi- francs. nated liabilities decreased from 54 percent to 49 percent. Compared with the previous year, there was no change in the As the Group produces a very high proportion of its products average interest rate of 4.4 percent on Holcim’s financial locally, most sales and costs are incurred in the same respective liabilities as per December 31, 2010. Fixed interest-bearing debt local currencies. The effects of foreign exchange movements accounted for 58 percent of financial liabilities. are therefore largely restricted to the translation of local financial statements into the consolidated statement of income. In Liquidity the last financial year these were, due to the strong Swiss To secure liquidity, the Group held liquid funds of CHF 3,386 mil- franc, slightly negative. Because a large part of the foreign lia- lion (2009: 4,474). This cash is invested to a large extent in time bility is financed with matching currencies in local currency, deposits held with a large number of banks on a broadly diver- the effects of the foreign currency translation of local balance sified basis. The counterparty risk is constantly monitored on sheets into the consolidated statement of financial position

1 Current financial liabilities adjusted for short-term drawings under long-term committed credit lines of CHF 150 million.

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54.indd 127 07.04.2011 14:32:01 54.indd 128 Financial Information Net financialdebt from operatingactivities Cash flow Net income Operating EBITDA Net sales Million CHF Sensitivity analysis franc: the respective5 percent in foreign currency versusthe Swiss The following showstheeffects ofahypothetical declineof is individuallyhedged. transaction involvestype of this onlyvery smallamounts or the analysis.reflected in Asaresult oflocalbusinessactivity, conducted locallyinforeignactions currencies be cannot Swiss francs (translation effect). Currency effects fromtrans- translationthe caused by oflocalfinancialstatements into analysis. those effectsThe sensitivityanalysisonlyfactors in key figures ispresentedthe followingthe basisof sensitivity on The currency relevant effectthe most of currencies onsome consolidated statement offinancialposition. have not, ingeneral,the in resulted distortions insignificant culfgrsAssuminga5%lowerexchangeratetheimpactwouldbeasfollows: Actual figures 163(2)(5)(8 14 10 (162) (19) (120) (76) (174) (98) (146) 11,363 (153) (122) 21,653 ,2 (31) 1,621 ,5 2)(15) (24) 3,659 ,1 3)(9 1)(3 3)(42) (30) (43) (10) (19) (33) 4,513 00UDERGBP EUR USD 2010 1 4 2)(0 (10) (10) (23) (4) 8 4)(9 (18) (19) (44) (8) N Latin INR 5(1 (126) (31) 35 (MXN, BRL, American ARS, CLP) basket

(AUD, IDR, PHP, THB) basket Asian 07.04.2011 14:32:01 Consolidated statement of income of Group Holcim Million CHF Notes 2010 2009 ±% Net sales 5, 6 21,653 21,132 +2.5

Production cost of goods sold 7 (12,379) (12,072) Consolidated Statements Financial Gross profit 9,274 9,060 +2.4 Distribution and selling expenses 8 (5,278) (4,828) Administration expenses (1,377) (1,451) Operating profit 2,619 2,781 –5.8 Other income 11 7 206 Share of profit of associates 23 245 302 Financial income 12 262 173 Financial expenses 13 (897) (881) Net income before taxes 2,236 2,581 –13.4 Income taxes 14 (615) (623) Net income 1,621 1,958 –17.2

Attributable to: Shareholders of Holcim Ltd 1,182 1,471 –19.6 Non-controlling interest 439 487 –9.9

Earnings per share in CHF Earnings per share1 16 3.69 4.93 –25.2 Fully diluted earnings per share1 16 3.69 4.93 –25.2

Million CHF Operating EBITDA 3, 10 4,513 4,630 –2.5 EBITDA 3 4,988 5,229 –4.6

1 EPS calculation based on net income attributable to shareholders of Holcim Ltd weighted by the average number of shares.

128 129

54.indd 129 07.04.2011 14:32:02 54.indd 130 Financial Information Currency translationeffects Other comprehensiveearnings – Taxexpense Net income Million CHF Consolidated statement of comprehensive earnings of Group Holcim – Changeinfairvalue Available-for-sale financialassets – Changeinfairvalue Cash flowhedges – Taxexpense – Realizedthroughstatementofincome – Changeinfairvalue Net investmenthedges – Taxexpense – Realizedthroughstatementofincome Non-controlling interest Shareholders ofHolcimLtd Attributable to: Total othercomprehensiveearnings – Taxexpense Total comprehensiveearnings oe 002009 2010 Notes 21 1(171) 21 (1,793) (2,042) ,2 1,958 1,621 12 2,249 (172) 35 1,734 (395) 421 223 (7) (3) 9

07.04.2011 14:32:02 (34) (18) 345 291 515 (7) (4) 9 Consolidated statement of financial position of Group Holcim Million CHF Notes 31.12.2010 31.12.2009 Cash and cash equivalents 17 3,386 4,474

Marketable securities 30 33 Consolidated Statements Financial Accounts receivable 18 2,590 3,401 Inventories 19 2,072 2,162 Prepaid expenses and other current assets 20 416 493 Assets classified as held for sale 21 18 234 Total current assets 8,512 10,797

Long-term financial assets 22 921 677 Investments in associates 23 1,432 1,529 Property, plant and equipment 24 23,343 25,493 Intangible assets 25 9,061 9,983 Deferred tax assets 32 385 412 Other long-term assets 26 605 315 Total long-term assets 35,747 38,409

Total assets 44,259 49,206

Trade accounts payable 28 2,303 2,223 Current financial liabilities 29 2,468 4,453 Current income tax liabilities 555 531 Other current liabilities 1,632 1,821 Short-term provisions 33 256 252 Total current liabilities 7,214 9,280

Long-term financial liabilities 29 12,281 13,854 Defined benefit obligations 34 317 376 Deferred tax liabilities 32 2,203 2,389 Long-term provisions 33 1,123 1,263 Total long-term liabilities 15,924 17,882

Total liabilities 23,138 27,162

Share capital 37 654 654 Capital surplus 9,371 9,368 Treasury shares 37 (476) (455) Reserves 8,552 9,466 Total equity attributable to shareholders of Holcim Ltd 18,101 19,033 Non-controlling interest 3,020 3,011 Total shareholders’ equity 21,121 22,044

Total liabilities and shareholders’ equity 44,259 49,206

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54.indd 131 07.04.2011 14:32:02 54.indd 132 Financial Information Equity asatDecember31,2009 Other comprehensiveearnings Net income Change inparticipationexistingGroupcompanies Acquisition ofparticipationinGroupcompanies Capital paid-inbynon-controllinginterest Share-based remuneration Change intreasuryshares Payout Share capitalincrease Equity asatJanuary1,2009 Equity asatDecember31,2010 Other comprehensiveearnings Net income Change inparticipationexistingGroupcompanies Acquisition ofparticipationinGroupcompanies Capital paid-inbynon-controllinginterest Share-based remuneration Change intreasuryshares Payout increase capital Share Equity asatJanuary1,2010 Million CHF Holcim Group of equity inconsolidated changes of Statement capital Share 654 654 654 100 527 27

(480) surplus Capital 6,870 9,368 9,371 9,368 1,940 552 6 3

Treasury shares (401) (455) (476) (455) (63) (32) 11 9

(594)

Retained earnings 15,019 14,178 15,019 15,688 1,471 1,182 07.04.2011 14:32:02 (27) (36) (9) 3

Available-for-sale Cash flow Currency Total Total equity Non-controlling Total reserve hedging translation reserves attributable to interest shareholders’

reserve adjustments shareholders equity Consolidated Statements Financial of Holcim Ltd (2) (2) (5,549) 9,466 19,033 3,011 22,044

(480) (480) (236) (716) 3 (29) (29) 14 4 18 29 29

(6) (42) (42) (11) (53) 1,182 1,182 439 1,621 251 9 (1,837) (1,577) (1,577) (216) (1,793) 249 7 (7,392) 8,552 18,101 3,020 21,121

(3) 17 (5,830) 8,362 15,358 2,616 17,974 2,040 2,040 (594) (15) (218) (233) (9) (72) (72) 15 1 16 22 (27) (27) 100 73 (5) (5) 1,471 1,471 487 1,958 1 (19) 281 263 263 28 291 (2) (2) (5,549) 9,466 19,033 3,011 22,044

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54.indd 133 07.04.2011 14:32:02 54.indd 134 Financial Information 1 Disposal offinancialassets,intangibleandotherassets Decrease inparticipationexistingGroupcompanies Other income Net incomebeforetaxes Million CHF Holcim Group of flows cash of statement Consolidated (De)Increase incashandequivalents(A+B+C) Cash flow(usedin)fromfinancingactivities(C) Dividends paidonordinaryshares Cash flowusedininvestingactivities(B) Financial expensesnet Share ofprofitassociates (De)Increase incashandequivalents Cash andcashequivalentsasatJanuary1(net) Capital increase Dividends paidtonon-controllinginterest Other non-cashitems Depreciation, amortizationandimpairmentofoperatingassets Operating profit Currency translationeffects Capital paid-inbynon-controllinginterest Change innetworkingcapital Cash andcashequivalentsasatDecember31(net) Movements oftreasuryshares Dividends received Cash generatedfromoperations Increase inparticipationexistingGroupcompanies Repayment oflong-termfinancialliabilities Proceeds fromlong-termfinancialliabilities Repayment ofcurrentfinancialliabilities Proceeds fromcurrentfinancialliabilities Interest received Other expenses Income taxespaid Interest paid Disposal ofproperty,plantandequipment Purchase ofproperty,plantandequipment Cash flowfromoperatingactivities(A) Disposal ofparticipationinGroupcompanies Acquisition ofparticipationinGroupcompanies Purchase offinancialassets,intangibleandotherassets as cashflows fromfi nancing activitiesandnotasinvestingactivities,whichistobeappliedonaretrospective basis. Based onanamendmentinIAS7,cashflows arisingfromchangesinownership interestsinasubsidiarythatdonotresultlossofcontrolare classifi 1 1 1 1 12, 13 oe 002009 2010 Notes 11 17 40 17 37 3(4)(302) (245) 23 ,9 1,849 1,894 9 320 1,196 (3,240) 132 (4,430) (1,362) 773 (13,433) (7,713) 181 (2,507) (1,821) 335 (10,393) (3,325) ,0 5,104 4,708 ,6 3,611 4,261 ,6 4,261 3,069 ,3 2,581 2,236 ,1 2,781 2,619 ,5 3,888 3,659 ,9 12,170 6,097 ,4 11,234 2,544 (943) 46 (744) (446) 14 (160) (154) (480) (249) (943) 29 (192) (239) 41 (639) (471) 89 (726) (829) (29) (43) 6)(1,782) (60) (54) 736 635 238 183 122 229 7 (206) (7) 30 29 2,040 0 0 ed ed 07.04.2011 14:32:02 (72) (90) 654 262 654 708 159 315 145 139 202 (4) 94 0 0 2 Accounting policies Basis of preparation The amendments to IAS 24 are disclosure-related only and will The consolidated financial statements have been prepared in have no impact on the Group’s financial statements. The amend-

accordance with International Financial Reporting Standards ment to IFRIC 14 clarifies that companies recognize the benefit Consolidated Statements Financial (IFRS). of a prepayment as a pension asset. The effect of applying this amendment will have no material effect on the Group’s finan- Adoption of revised and new International Financial Reporting cial statements. The improvements to IFRSs relate largely to Standards and new interpretations clarification issues only. Therefore, the effect of applying these In 2010, Group Holcim adopted the following revised standards amendments will have no material impact on the Group’s relevant to the Group, which became effective from January 1, financial statements. 2010: In 2013, Group Holcim will adopt the following new standard IAS 27 (amended) Consolidated relevant to the Group: and Separate Financial Statements IFRS 3 (revised) Business Combinations IFRS 9 Financial Instruments IFRS 2 (amended) Share-based Payment Improvements to IFRSs Clarifications of existing IFRSs IFRS 9 will ultimately replace IAS 39. Classification and measurement of financial assets and financial liabilities represents According to IAS 27 (amended), changes in the ownership inter- the first part of the new standard. This standard will require est of a subsidiary that do not result in a loss of control are financial assets to be classified on initial recognition at either accounted for as an equity transaction. The amendment to IFRS amortized cost or fair value. For financial liabilities, the new 3 (revised) introduced several changes such as the choice to standard retains most of the current IAS 39 requirements. measure a non-controlling interest in the acquiree either at fair Therefore, the effect of applying the first part of this new value or at its proportionate interest in the acquiree’s identifi- standard will have no material impact on the Group’s financial able net assets, the accounting for step acquisitions requiring statements. the remeasurement of a previously held interest to fair value through profit or loss as well as the expensing of acquisition Use of estimates costs directly to the statement of income. The effect of apply- The preparation of financial statements in conformity with ing IFRS 2 (amended) clarifying the accounting of group cash- IFRS requires management to make estimates and assump- settled shared-based payment transactions had no impact on tions that affect the reported amounts of revenues, expenses, the Group. The improvements to IFRSs relate largely to clarifi- assets, liabilities and related disclosures at the date of the cation issues only. Therefore, the effect of applying these financial statements. These estimates are based on manage- amendments had no material impact on the Group’s financial ment’s best knowledge of current events and actions that the statements. Group may undertake in the future. However, actual results could differ from those estimates. In 2011, Group Holcim will adopt the following revised standards relevant to the Group: Critical estimates and assumptions Estimates and judgments are continually evaluated and are IAS 24 (amended) Related Party Disclosures based on historical experience and other factors, including IFRIC 14 (amended) IAS 19 – Prepayment of a minimum expectations of future events that are believed to be reason- funding requirement able under the circumstances. Improvements to IFRSs Clarifications of existing IFRSs

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54.indd 135 07.04.2011 14:32:02 54.indd 136 Financial Information assumed. tion, irrespectivethe extent ofany of non-controlling interest tion are measured fair initiallyat valuethe date ofacquisi- at assets acquired andliabilitiesassumed inabusinesscombina- incurred are expensedthestatement ofincome. in Iden tifiable sharethe acquiree’s of assets. identifiable net Acquisitioncosts the acquiree in fair eitherat est valuethe proportionate orat combination,the acquirer measuresthe noncontrolling inter- considerationthe date given ofexchange. at For eachbusiness ofanacquisitionismeasuredThe cost thefair at valuethe of January 1, 2010, are accounted forthe acquisitionmethod. using are consolidated. Businesscombinations occurringonor after to exercisethe power wise has control overthe operations, an interestthe voting ofmorethan onehalfof rights orother- Subsidiaries, whicharethe Groupthose entities inwhichhas Principles of consolidation companiesthe HolcimGroup”. of ofprincipalcompanies ispresentedlist the section in “Principal Holcim Ltd andofitssubsidiaries, ventures. includingjoint The The consolidated financialstatements comprisethoseof Scope of consolidation disclosures. corresponding All estimates mentioned abovethe detailedin are further the useofestimates (note25). based onvalue-in-use calculations. These calculations require erable amounts ofcashgenerating unitshave beendetermined inaccordanceimpairment withitsaccounting policy. The recov- The Grouptestsannuallywhethergoodwillhassuffered any (note34). uncertainty to significant such estimates are subject pension increases.the long-termnatureto these plans, Due of plan assets, future salaryincreases, rates mortality and future discount rates,assumptions about expected rates ofreturn on valuations.actuarial valuationThe actuarial involves making plans andotherpost-employment benefitsisdeterminedusing period.the reporting end of pension ofdefinedbenefit The cost and disclosureand equipment ofcontingentthe liabilitiesat tax assets, long-termprovisions, depreciation ofproperty, plant will,to alesserextent, and obligations, definedbenefit deferred financialyearthe next bilities withinrelateto good- primarily the carryingamounts ofassetsandlia- to material adjustment maythat assumptions have riskofcausinga asignificant the relatedseldom equal results. actual The estimates and future. The resulting accounting estimates will, bydefinition, The Group makes estimates andassumptionsconcerningthe retained earnings. the financialliabilityarechanges of recognized directly in the non-controllingof interest fair andallsubsequent value date.that at Any excess overthe reclassified carrying amount took placethe acquisition date eachreporting liability at asif allocation orlossandisreclassified ofprofit asafinancial combination, non-controlling interest continuesto receive an acquired ofabusiness apresent ownership interest aspart the non-controlling interest. However, wherethe Group hasnot recognized orlossandnoearningsare inprofit to attributed fairAll subsequent valuethe financialliabilityare changesof followthe accountingtreatment asinabusinesscombination. thereforethe acquisitiondate and any excess arisingshould non-controlling interestto have isdeemed beenacquired at interest recognized directly asgoodwill. Insuchacase,the any excessthe non-controlling over of the carryingamount optionisrecognizedvaluethe put of asafinancialliabilitywith ofabusiness combination,ownership interest aspart the fair business combination.the Group Ifhasacquired apresent the non-controlling ofaheld by shareholders mainlyaspart acquirethe remaining calloptionsinconnection with shares iscommon practiceIt optionsand forthe Grouptowriteput companies are eliminated infull. All intercompanytransactions andbalancesbetweenGroup controlthat the date ceases. transferredthe Groupto andare nolongerconsolidated from Subsidiaries are consolidated fromthedate onwhichcontrol is recognized orloss. inprofit the fairto valuechanges the contingent of consideration are recognized fair at valuethe acquisitiondate. at Subsequent Any contingent considerationtransferredto be the Group byis throughacquisition date orloss. profit interestthe acquiree in isremeasuredto fair valuethe asat sition date fair value ofGroup Holcim’s previously heldequity the businesscombinationIf isachieved in stages,the acqui- acquisition date. economic conditionsthe circumstances asof andpertinent and designation inaccordancethe contractual with terms, cial assetsandliabilitiesassumedfor appropriate classification When Group Holcimacquires abusiness,the finan- assesses it 07.04.2011 14:32:02 The Group’s interest in jointly controlled entities is consoli- Exchange differences arising on monetary items that form part dated using the proportionate method of consolidation. Under of a company’s net investment in a foreign operation are this method, the Group records its share of the joint ventures’ reclassified to equity (currency translation adjustment) in the

individual income and expenses, assets and liabilities and cash consolidated financial statements and are only fully recycled Consolidated Statements Financial flows in the consolidated financial statements on a line-by-line to the statement of income when Group Holcim loses control basis. All transactions and balances between the Group and of a subsidiary, loses joint control over a joint venture or loses joint ventures are eliminated to the extent of the Group’s inter- significant influence in an associate. est in the joint ventures. Segment information Investments in associated companies are accounted for using Segment information is presented in respect of the Group’s the equity method of accounting. These are companies over reportable segments. which the Group generally holds between 20 and 50 percent of the voting rights and has significant influence but does not For management purposes, the Group is organized by geo- exercise control. Goodwill arising from the acquisition is included graphical areas and has five reportable segments based on in the carrying amount of the investment in associated com- location of assets as follows: panies. Equity accounting is discontinued when the carrying amount of the investment together with any long-term inter- Europe est in an associated company reaches zero, unless the Group North America has in addition either incurred or guaranteed additional obli- Latin America gations in respect of the associated company. Africa Middle East Asia Pacific Foreign currency translation The individual financial statements of each of the Group’s Each of the above reportable segments derives its revenues companies are measured using the currency of the primary from the sale of cement, aggregates and other construction economic environment in which the entity operates (“the func- materials and services. tional currency”). Statements of income of foreign entities are translated into the Group’s reporting currency at average exchange rates for the year and statements of financial position are translated at exchange rates prevailing on December 31.

Goodwill arising from the acquisition of a foreign entity is expressed in the functional currency of the foreign operation and is translated at the closing rate.

Foreign currency transactions translated into the functional currency are accounted for at the exchange rates prevailing at the date of the transactions; gains and losses resulting from the settlement of such transactions and from the translation of monetary assets and liabilities denominated in foreign currencies are recognized in the statement of income, except when deferred outside the statement of income as qualifying cash flow hedges.

136 137

54.indd 137 07.04.2011 14:32:02 54.indd 138 Financial Information year end. thereview at the financialasset ofalloutstandingamounts of lessanestimateamount madefor doubtfuldebtsbasedona Trade accounts receivable arethe original invoice carried at Accounts receivable statement ofincome. comprehensive earningsisreclassifiedthe fromto equity the cumulativetime gainorlosspreviously recognized inother iseitherimpairedthe financialasset ordisposedof, which at value changes recorded inothercomprehensive earningsuntil as available-for-sale. They are fair carriedat value withallfair securities whicharetraded inliquidmarkets andare classified Marketable andequity primarilyofdebt securitiesconsist Marketable securities bank overdrafts. banks andothershort-term, highlyliquidinvestments, of net banksprise cashat andinhand, depositsheldoncallwith the statement ofcashflows,of cashandequivalents com- threeoriginal maturities of months orless. Forthe purpose lents are readily convertible into ofcashwith aknownamount Cash andcashequivalents are financialassets. Cash equiva- equivalents cash Cash and solidation. between segments. transfersThose are eliminated oncon- revenueSegment transfers result andsegment include thirdtransactions parties. with to basis inamannersimilar Transfer pricesbetweensegments are onanarms-length set areto any allocated segments. reportable not income) andincometaxes are managedonaGroup basisand Group financing(includingcosts andfinancing and paving,trading andotherproducts andservices ready-mix concrete, concrete products, asphalt, construction Other construction materials andservices, whichcomprises Aggregates materials cementitious Cement, whichcomprises clinker, andother cement The Groupthree lines: has product income. sive earningsisreclassifiedthe statement of fromto equity lative gainorlosspreviously recognized inothercomprehen- iseitherimpairedasset ordisposedof,the cumu- time which at included inothercomprehensivethe financial earningsuntil the fairchanges in value ofavailable-for-sale investments are the effective interest method. Gainsandlossesarisingfrom to-maturity investments are using cost amortized carriedat able-for-sale investments are fair carriedat value, whileheld- the effective using cost amortized at interest method. Avail- for derivative instruments. Loans andreceivables are measured the asset. Purchasesell transaction costs, includes cost except date,the Group commitstopurchasethat the date or whichis All purchases andsalesofinvestments are recognizedtrade on be classifiedasheldfortrading. ments: Recognition andMeasurement,they will inwhichcase hedgingcriteriaunderIAS 39Financialthe strict Instru- meet assets are regarded asheldforthey donot hedgingunless may bedesignated asavailable-for-sale. Long-term derivative able wherethe paymenttermsare fixed ordeterminable not are classifiedasloansandreceivables.parties Aloanorreceiv- for-sale andlong-termreceivables fromthird associates and assets. Investments arethird classifiedasavailable- parties in receivables fromthird parties, and(d) long-termderivative parties, (b)long-termreceivables from associates, (c)long-term Long-term of(a) financialassetsconsist investmentsthird in assets financial Long-term cash flowhedgesrelatingto inventory purchases. transfersincludes from equityofgainsorlossesonqualifying costs andrelated production overheads. Cost ofinventories prises raw materials andadditives, labor, direct otherdirect method. offinishedgoodsandworkinprogressThe cost com- value.the weighted Cost average isdeterminedbyusing cost Inventories realizable are andnet the lowerofcost stated at Inventories 07.04.2011 14:32:02 Property, plant and equipment mencement of the lease term at the present value of the mini- Property, plant and equipment is valued at acquisition or con- mum future lease payments or, if lower, at an amount equal to struction cost less depreciation and impairment loss. Cost the fair value of the leased asset as determined at the incep-

includes transfers from equity of any gains or losses on qualify- tion of the lease. The corresponding lease obligations, exclud- Consolidated Statements Financial ing cash flow hedges. Depreciation is charged so as to write off ing finance charges, are included in either current or long-term the cost of property, plant and equipment over their estimated financial liabilities. useful lives, using the straight-line method, on the following bases: For sale and lease-back transactions, the book value of the related property, plant or equipment remains unchanged. Pro- Land No depreciation except on land ceeds from a sale are included as a financing liability and the with raw material reserves financing costs are allocated over the term of the lease in such Buildings and installations 20 to 40 years a manner that the costs are reported over the relevant periods. Machinery 10 to 30 years Furniture, vehicles and tools 3 to 10 years Non-current assets (or disposal groups) classified as held for sale Costs are only included in the asset’s carrying amount when Non-current assets (or disposal groups) are classified as held it is probable that economic benefits associated with the item for sale and stated at the lower of carrying amount and fair will flow to the Group in future periods and the cost of the value less costs to sell if their carrying amount is to be recov- item can be measured reliably. Costs include the initial esti- ered principally through a sale transaction rather than through mate of the costs of dismantling and removing the item and continuing use. restoring the site on which it is located. All other repairs and maintenance expenses are charged to the statement of income Goodwill during the period in which they are incurred. Goodwill represents the excess of the aggregate of the consideration transferred and the amount recognized for the non- Mineral reserves, which are included in the class “land” of controlling interest over the fair value of the net identifiable property, plant and equipment, are valued at cost and are assets acquired and liabilities assumed. Goodwill on acquisi- depreciated based on the physical unit-of-production method tions of subsidiaries and interests in joint ventures is included over their estimated commercial lives. in intangible assets. Goodwill on acquisitions of associates is included in investments in associates. Goodwill is tested annu- Costs incurred to gain access to mineral reserves are capital- ally for impairment or whenever there are impairment indi- ized and depreciated over the life of the quarry, which is based cators and carried at cost less accumulated impairment losses. on the estimated tonnes of raw material to be extracted from If the consideration transferred is less than the fair value of the reserves. the net assets of the subsidiary acquired, the difference is recognized directly in the statement of income. Interest cost on borrowings to finance construction projects, which necessarily takes a substantial period of time to get On disposal of a subsidiary, associate or joint venture, the related ready for their intended use, are capitalized during the period goodwill is included in the determination of profit or loss on of time that is required to complete and prepare the asset for disposal. its intended use. All other borrowing costs are expensed in the period in which they are incurred. Goodwill on acquisitions of subsidiaries and interests in joint ventures is allocated to cash generating units for the purpose Government grants received are deducted from property, plant of impairment testing (note 25). Impairment losses relating to and equipment and reduce the depreciation charge accordingly. goodwill cannot be reversed in future periods.

Leases of property, plant and equipment where the Group has substantially all the risks and rewards of ownership are classified as finance leases. Property, plant and equipment acquired through a finance lease is capitalized at the date of the com-

138 139

54.indd 139 07.04.2011 14:32:02 54.indd 140 Financial Information recognizedthe statement immediately ofincome. in inpriorperiods.ating unit Areversal lossis ofanimpairment loss beenrecognized orcashgener- for non-financialasset that wouldhavethat amount beendeterminedhadnoimpairment However,this increasedexceed cannot amount the carrying the revisedincreasedto estimate ofitsrecoverable amount. orcashgeneratingthe non-financialasset is of amount unit Where losssubsequently animpairment reverses,the carrying are recognizedthe statement immediately ofincome. in isreducedto itsrecoverableunit amount. losses Impairment orcashgeneratingthe non-financialasset of carrying amount than itscarryingamount,to be less isestimatedating unit the the recoverable orcashgener- ofanon-financialasset amount erating unit’s fair value lesscoststosellanditsvalue inuse. If The recoverablethe higherofanasset’s is amount orcash gen- belongs.the non-financialasset cash generatingto which unit the Groupthe recoverable estimates the smallest of amount the recoverable ofanindividualnon-financialasset, amount loss,the impairment ifany. to estimate possible Where isnot it the extent isestimated ofto determine inorderfinancial asset any suchindication exists,the recoverable the non- of amount mayany anon-financialasset beimpaired.that indication If At date, eachreporting the Groupthere assesseswhether is assets non-financial of Impairment their estimated usefullives, exceeding not but 20years. the straight-linecapitalized using andamortized methodover Expenditure onacquired patents,trademarks andlicensesis intangibleOther assets their usefullives, exceeding not three but aperiodof years. the straight-lineas assetsare using amortized methodover software. Computer software development costs recognized cationsthe are of the originalcost to capitalized andadded computer software programs beyondtheir originalspecifi- Expenditures whichenhanceorextendtheperformance of one year are recognized asintangible assets. probably generate economic benefitsexceeding costs beyond software products controlledthe Group byandwhichwill Costs arethat directly associated withidentifiable andunique software programs are recognized asanexpense asincurred. Costs associated withdeveloping ormaintaining computer Computer software assessed asuncollectible. account. Impaired receivables are derecognizedthey are when the receivableof isreducedthrough useofanallowance the invoice.terms of the original due under The carryingamount the amounts allof to collect beable the Group willnot that of insolvency financialdifficulties orsignificant the debtor) of theremade when isobjectivetheprobability evidence (suchas In relationto accounts receivable, aprovision for is impairment the statement ofincome. event occurringafter losswasthe impairment recognized in fair value canbeobjectivelythe instrument related of to an instruments are recognizedthe increase orlossif inprofit in hensive earningswhilereversals lossesondebt ofimpairment classified asavailable-for-sale are recognized inother compre- basis. Reversals lossesonequityinstruments ofimpairment financial assetsaretested for onanindividual impairment lated byreferenceto itsfair value. Individuallysignificant isrecognizedasset the statement ofincome in andiscalcu- ofanavailable-for-sale loss inrespect An impairment financial loss isrecognized orloss. inprofit the reversaltized at cost date. Any reversal ofanimpairment exceed doesnot the carryingvaluethe asset itsamor-that of viously recognized lossisreversed, impairment the extentto event occurringafter wasthe impairment recognized, the pre- decreasesthe decrease and canberelatedto an objectively If, period, inasubsequent lossthe impairment of the amount account. the lossisrecognized of The amount orloss. inprofit isreducedthroughthe useofanallowancethe asset of amount countedthe originaleffective at interest rate. The carrying the presentand valuethe future of estimated cashflows dis- the difference iscalculatedcost as betweenitscarryingamount measured ofafinancialasset amortized at lossinrespect ment may afinancialasset beimpaired.that indication Animpair- At date, eachreporting the Groupthere assesseswhether isany assets financial of Impairment the statementthe borrowings. ofincometerm of overthe tion costs)the redemption and value beingrecognized in method, withany differencetransac- of betweenproceeds (net bonds arethe effective stated using cost amortized at interest costs incurred. Subsequently, bankloansandnon-convertible the proceedsognized received, initiallyat transaction of net Bank loansacquired bondsissued are andnon-convertible rec- liabilities financial Long-term 07.04.2011 14:32:03 Upon issuance of convertible bonds, the fair value of the liabili- Site restoration and other environmental provisions ty portion is determined using a market interest rate for an The Group provides for the costs of restoring a site where a equivalent non-convertible bond; this amount is carried as a legal or constructive obligation exists. The cost of raising a pro-

long-term liability on the amortized cost basis using the effec- vision before exploitation of the raw materials has commenced Consolidated Statements Financial tive interest method until extinguishment on conversion or is included in property, plant and equipment and depreciated maturity of the bonds. The remainder of the proceeds is allo- over the life of the site. The effect of any adjustments to the cated to the conversion option, which is recognized and included provision due to further environmental damage as a result of in shareholders’ equity; the value of the conversion option is exploitation activities is recorded through operating costs over not remeasured in subsequent periods. the life of the site to reflect the best estimate of the expenditure required to settle the obligation at the end of the report- Long-term derivative liabilities are regarded as held for hedging ing period. Changes in the measurement of a provision that unless they do not meet the strict hedging criteria under IAS 39 result from changes in the estimated timing or amount of cash Financial Instruments: Recognition and Measurement, in which outflows, or a change in the discount rate, are added to, or case they will be classified as held for trading. deducted from, the cost of the related asset to the extent that they relate to the asset’s installation, construction or acquisi- Financial liabilities that are due within 12 months after the end tion. All provisions are discounted to their present value. of the reporting period are classified as current liabilities unless the Group has an unconditional right to defer settle- Emission rights ment of the liability until more than 12 months after the The initial allocation of emission rights granted is recognized reporting period. at nominal amount (nil value). Where a Group company has emissions in excess of the emission rights granted, it will rec- Deferred taxes ognize a provision for the shortfall based on the market price Deferred tax is provided, using the balance sheet liability method, at that date. The emission rights are held for compliance on temporary differences arising between the tax bases of purposes only and therefore the Group does not intend to assets and liabilities and their carrying amounts in the finan- speculate with these in the open market. cial statements. Tax rates enacted or substantially enacted by the end of the reporting period are used to determine the Other provisions deferred tax expense. A provision is recognized when there exists a legal or constructive obligation arising from past events, it is probable that an Deferred tax assets are recognized to the extent that it is prob- outflow of resources embodying economic benefits will be able that future taxable profit will be available against which required to settle the obligation and a reliable estimate can be temporary differences or unused tax losses can be utilized. made of this amount. Deferred tax liabilities are recognized for taxable temporary differences arising from investments in subsidiaries, associates and joint ventures except where the Group is able to control the distribution of earnings from these respective entities and where dividend payments are not expected to occur in the foreseeable future.

Deferred tax is charged or credited in the statement of income, except when it relates to items credited or charged outside the statement of income, in which case the deferred tax is treated accordingly.

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54.indd 141 07.04.2011 14:32:03 54.indd 142 Financial Information income in the period to which the contributionsto which relate.incomethe period in defined contribution plansarethe statement ofto charged on localpractices andregulations. The Group’s contributionsto Group companies sponsordefinedcontribution plansbased plansdescribedabove,the definedbenefit to In addition some plans contribution –Defined benefits Employee costs. service lossesandpast actuarial futurethe planandany contributions unrecognizedto net the formable in ofrefunds fromtheplanor reductions in exceednot the present value ofany economic benefitsavail- does isrecorded it that pensionasset the extent A net to only obligation. the definedbenefit terms of corporate bondsarethe currency consistent with andestimated quality corporatethe bondswherethe currencyterms of and using adiscountthe interest rateto rate issimilar that onhigh measuredthe present value at ofestimated future cashflows the previousthe endof year. assets at The pensionobligation is the fair obligation and the definedbenefit valueof ofplan exceedsamount the greater 10percent of the present of value cumulativethe net unrecognized that the extent to only but average remaining employees, working livesthe participating of the expected gainsorlossesareActuarial basedon amortized occurs. orsettlement the curtailment nized when ofpensionbenefitsare orsettlement recog-the curtailment the amendedbenefitsbecomeuntil vested. Gainsorlosseson are recognized onastraight-line basisoverthe average period separatelythe finalobligation.to buildup Past costs service entitlement andmeasures ofbenefit eachunitadditional unit to anmethod considers asgivingrise eachperiodofservice credit method.the projected unit creditThe projected unit obligation andcosts ofpensionbenefitsare determinedusing obligationsvalue onaregularthe definedbenefit basis. The for employees. Professionally actuaries qualifiedindependent Some Group companies provide pensionplans definedbenefit plansEmployee benefit – Defined benefits Non-controlling interest Non-controlling andexpected levels actual to reflect ofvesting (note34). ofincomement overthe relevant vesting periodsandadjusted instruments granted. The amounts arethe state- to charged is determinedbyreferencethe fairto value the equity of is recognized asanexpense. to beexpensed total amount The received inexchange forthe grantthe optionsorshares of pensation plans. The fair valuethe employee of services The Group operates various equity-settled share-based com- plans compensation –Equity benefits Employee immediately andnocorridor approach isapplied. gainsandlossesare allactuarial that recognized plans in benefit The measurementthese obligations differs of from defined sharing,profit variable anddeferred compensation. twelveto besettledwithin months due afterthe yearnot end, sevice benefits, long-termdisabilitybenefitsand,they are if leave orsabbatical leave, medicalaid, jubileeorotherlong- benefitsincludelong-serviceOther long-termemployment benefits employment long-term –Other benefits Employee paid orreceived isrecognized directly inretained earnings. ling interestthe fair isadjustedand valuethe consideration of any differencethe non-control- bywhich the amount between non-controlling interest inasubsidiary, losing control, without tion. Consequently, disposesofa ifHolcim acquires orpartially result inlossofcontrol are accounted fortransac- asanequity donotthe ownershipinterestthat Changes in ofasubsidiary the consolidatedwithin equityin statement offinancialposition. the consolidated statement ofcomprehensive earningsand sented separatelythe consolidated in statement ofincome, in utable, directly orindirectly,to aparent company andispre- Non-controlling attrib- interestthe equityinasubsidiarynot is 07.04.2011 14:32:03 Revenue recognition Revenue is recognized when it is probable that the economic benefits associated with the transaction will flow to the entity

and the amount of the revenue can be measured reliably. Reve- Consolidated Statements Financial nue is measured at the fair value of the consideration received net of sales taxes and discounts. Revenue from the sale of goods is recognized when delivery has taken place and the transfer of risks and rewards of ownership has been completed.

Interest is recognized on a time proportion basis that reflects the effective yield on the asset. Dividends are recognized when the shareholder’s right to receive payment is established.

Certain activities of the Group are construction contract driven. Consequently, contract revenue and contract costs are recognized in the statement of income on the percentage of completion method, with the stage of completion being measured by reference to actual work performed to date.

Contingent liabilities Contingent liabilities arise from conditions or situations where the outcome depends on future events. They are disclosed in the notes to the financial statements.

Financial instruments Information about accounting for derivative financial instruments and hedging activities is included in the section “Risk management”.

142 143

54.indd 143 07.04.2011 14:32:03 257.indd 144 Financial Information and investing excess liquidity. risk, counterparty risk, useofderivative financialinstruments ing specificareas suchasinterest rate risk, foreign exchange principles for overall aswellpoliciescover- riskmanagement policies approved bykey personnel. management provides It Financialthe Group withinisgoverned riskmanagement by pursued. to itsoperating business. Assuch, arisk-averse approach is derivativetransactions whichare orotherfinancial unrelated exposures.certain Therefore, enterthe Group into doesnot foreign exchange contracts andinterest rate swapsto hedge Group. The Group usesderivative financialinstruments suchas potential adverse effectsthethe financialperformance of on the unpredictability offinancialmarkets and seekstominimize rates. The Group’s overall program riskmanagement focuses on market prices, foreign currency exchange rates and interest the effect structure andequityincluding ofchangesindebt The Group’sto avariety expose activities offinancialrisks, it riskFinancial management ings andprovidesthe measures updatestaken. on the Boardriskanalysisfind- ofDirectorsto onimportant larly and bottom-upangles. The Executive Committee regu- reports The Group’s riskprofile isassessedfrom avarietytop-down of the Board ofDirectorsand are alsoinvolvedthe assessment. in the Groupto companies,In addition the Executive Committee compliance andreputational aspects. the external businessenvironment, are considered including types ofrisk, from market, operations,to financeandlegalup then proposedthe appropriate andimplemented at level. All an earlystageandconstantly monitored. Countermeasures are pany encounters. Potential risks are identified andevaluated at atically recognizethe com- alsoopportunities majorrisks but strategic decisions.to system- aims BusinessRiskManagement the Groupteams ofcompaniestheir in the management and the Executive supports Business RiskManagement Committee Business risk management Risk management financing purposes. to make efficientit useofinternational financialmarkets for strong internationalthe Group ofallows creditworthiness itsliquidityrequirementsto meet times. all at Inaddition,the unused credit linesandreadily realizable marketable securities tool andmaintains sufficientity planning reserves ofcash, The Group monitorsitsliquidityriskbyusingarecurring liquid- to approval Group at level. cits,the Groupto guidancebyand, cases, subject incertain the raisingto coverown cashsurplusesand ofloans cashdefi- their obligations. Individualcompanies are responsible fortheir Group companies needasufficient availabilityto meet ofcash risk Liquidity by increasestransactions.the valuethe underlying in of loss invaluethose instruments generally of wouldbeoffset to acquire.the liquidity has Holcim,therefore, anythat expects wantsto acquire optionsonpositionsit writeput andmight liquid funds, hasorit writecalloptionsonassetsit might it changes inforeign exchange andinterest rate risk. To manage priate, fluctuations inearningsandcashflows associated with instruments. The Group’sto reduce, objective is where appro- exposures, Holcimenters into avariety ofderivative financial these exposures. Tothe volatility manage relatingtheseto exchange andinterest rate risk. actively Management monitors Holcim isexposedtomarket risk, primarilyrelatingto foreign Market risk 07.04.2011 14:32:34 Contractual maturity analysis Contractual cash flows Million CHF Within Within Within Within Within Thereafter Total 1 year 2 years 3 years 4 years 5 years Consolidated Statements Financial 2010 Trade accounts payable 2,303 2,303 Loans from financial institutions 1,906 624 826 233 166 326 4,081 Bonds and private placements 815 1,076 2,313 1,780 751 3,542 10,277 Interest payments 568 567 473 386 233 919 3,146 Finance leases 27 29 14 11 5 63 149 Derivative financial instruments held for hedging net1 (28) (24) 72 (14) 31 (27) 10 Total 5,591 2,272 3,698 2,396 1,186 4,823 19,966

2009 Trade accounts payable 2,223 2,223 Loans from financial institutions 3,347 666 752 1,150 107 236 6,258 Bonds and private placements 1,392 682 1,062 2,454 2,166 4,098 11,854 Interest payments 738 627 615 482 384 1,255 4,101 Finance leases 35 28 28 11 11 73 186 Derivative financial instruments held for hedging net1 (40) (26) (16) (64) (13) (65) (224) Total 7,695 1,977 2,441 4,033 2,655 5,597 24,398

The maturity profile is based on contractual undiscounted Interest rate sensitivity amounts including both interest and principal cash flows and The Group’s sensitivity analysis has been determined based on based on the earliest date on which Holcim can be required the interest rate exposure relating to the Group’s financial lia- to pay. bilities at variable rate on a post hedge basis as at December 31.

Contractual interest cash flows relating to a variable interest A 1 percentage point change is used when the interest rate risk rate are calculated based on the rates prevailing as of Decem- is reported internally to key management personnel and repre- ber 31. sents management’s assessment of a reasonably possible change in interest rates. Interest rate risk The Group is exposed to fluctuations in financing costs and At December 31, a ±1 percentage point shift in interest rates, market value movements of its debt portfolio related to changes with all other assumptions held constant, would result in in market interest rates. Given the Group’s substantial bor- approximately CHF 46 million (2009: 68) of annual additional/ rowing position, interest rate exposure is mainly addressed lower financial expenses before tax on a post hedge basis. The through the steering of the fixed/floating ratio of debt. To Group’s sensitivity to interest rates is lower than last year manage this mix, Holcim may enter into interest rate swap mainly due to the fact that the ratio of financial liabilities at agreements, in which it exchanges periodic payments, based on variable rates to total financial liabilities has decreased from notional amounts and agreed-upon fixed and variable interest 49 percent to 42 percent. rates.

1 The contractual cash fl ows for all derivative fi nancial instruments held for hedging include both cash in- and outfl ows. Additional information is disclosed in note 31.

144 145

257.indd 145 07.04.2011 14:32:34 257.indd 146 Financial Information post hedge basis in both the current hedgebasisinboth andprioryear.post onforeignimmaterial impact exchange lossesbeforetax ona respective currenciesthe Group operates inwouldonlyhave an the CHF,A ±5percent changein the against USDandEUR sible changeinforeign exchange rates. and represents management’s ofareasonably assessment pos- to key internally riskisreported action personnel management foreignthe net A 5percent changeisusedwhen currencytrans- the respective currenciesthe Group operates in. transaction riskmainlyarisesfrom CHF, against USDandEUR they arein which measured. The Group’s foreign net currency nated inaforeign currencythe functional currencythan other arethat December31 denomi- financial assetsandliabilitiesat the Group’stransaction exposure arisesonmonetarythat net The Group’s sensitivityanalysishasbeendeterminedbasedon Currency sensitivity considerednot economical. the hedgingofforecasted include istransactionsdo not asit cash flowhedgesorfair value hedges, asappropriate, which but enter into derivative contracts whichare designated aseither foreign currencies. Asaconsequencethereof, subsidiariesmay ofcapitalexpenditures amount ing andasignificant may bein income willbeprimarilyinlocalcurrency whereas servic- debt transaction riskislimited. However, for many Group companies, the localnatureto the construction materialsDue of business, in equityandincludedcurrencytranslation adjustments. is effective, allforeign exchange gainsorlossesare recognized cash flowhedges. To investmentthe net hedge that the extent investments inforeign entities are accounted forto similarly currency borrowings orotherinstruments. Hedgesofnet investments net hedge certain inforeign entities withforeign currencyto currencytranslation leads effects. The Group may translationThe offoreign operationsthe Group into reporting therefore isexposedto foreign currency risks. The Group operates internationally inaround 70countries and Currency risk Holcim. the shareholders’ material based on as not equityofGroup to derivative onequitydue Impacts instruments are considered Holcim. the shareholders’ material based on as not equityofGroup to derivative onequitydue Impacts instruments are considered to maintain asolidinvestment grade rating. the rangea gearingin ofnomorethan 100percent inorder 25percent and least ofat a percentage financialdebt ofnet 2009, wasto maintain aratio offundsfrom operations as During 2010,the Group’s target, whichwas unchangedfrom of financialposition. shareholders’the consolidated equityasshownin statement total dividedby financialdebt Gearing iscalculated asnet the consolidated statement offinancial position. financial liabilitieslesscashandequivalents asshownin dated statement ofincome. iscalculated as financialdebt Net ciation,the consoli- amortization asshownin andimpairment Funds from operations income iscalculated plusdepre- asnet andgearing. cial debt the ratio offundsfrom operations asapercentage finan- ofnet The Group monitorscapital, amongothers,the basisofboth on reduce debt. shareholders, issuenewshares,to increase orsellassets debt to shareholders, ofdividendspaid amount returnto capital the capitalstructure, tain oradjust the Groupthe may adjust the underlying assets.risk characteristics of to main- Inorder business activities, investment andexpansion programthe and ofchangesineconomicthe light conditions, in to it ments its The Groupthecapitalstructure andmakes manages adjust- capital structure. to maintain acost-efficientholders and andrisk-optimized provide returnsto shareholders andbenefitsfor otherstake- concernto cater for aswelltargetsto inorder itsgrowth the Group’sto continue ongoingfinancialneeds asagoing The Group’s objectives whenmanagingcapitalareto secure Capital structure the Group.directly relatedthe businessof to options onshares orotherequityproducts whichare not In general, holdoracquirethe Group doesnot any shares or risk securities and Equities 07.04.2011 14:32:35 Despite a decrease in net income, the ratio of funds from oper- The decrease in gearing arose due to the disproportionate ations/net financial debt increased as a result of the dispropor- decrease in net financial debt compared to the decrease tionate decrease in net financial debt. in total shareholders’ equity. Shareholders’ equity decreased

by 4.2 percent during 2010 mainly as a result of currency Consolidated Statements Financial trans lation adjustments and dividends paid.

Million CHF 2010 2009 Net income 1,621 1,958 Depreciation, amortization and impairment (note 9) 1,934 1,858 Funds from operations 3,555 3,816

Financial liabilities (note 29) 14,749 18,307 Cash and cash equivalents (note 17) (3,386) (4,474) Net financial debt 11,363 13,833 Funds from operations/net financial debt 31.3% 27.6%

Million CHF 2010 2009 Net financial debt 11,363 13,833 Total shareholders’ equity 21,121 22,044 Gearing 53.8% 62.8%

Credit risk Accounting for derivative financial instruments Credit risks arise from the possibility that customers may not and hedging activities be able to settle their obligations as agreed. To manage this Derivatives are initially recognized at fair value on the date a risk, the Group periodically assesses the financial reliability of derivative contract is entered into and are subsequently remea- customers. sured at their fair value. The method of recognizing the resulting gain or loss is dependent on the nature of the item being Credit risks, or the risk of counterparties defaulting, are con- hedged. On the date a derivative contract is entered into, the stantly monitored. Counterparties to financial instruments Group designates certain derivatives as either (a) a hedge of consist of a large number of major financial institutions. The the fair value of a recognized asset or liability (fair value hedge) Group does not expect any counterparties to fail to meet their or (b) a hedge of a particular risk associated with a recognized obligations, given their high credit ratings. In addition, Holcim asset or liability, such as future interest payments on floating has no significant concentration of credit risk with any single rate debt (cash flow hedge) or (c) a hedge of a foreign currency counterparty or group of counterparties. risk of a firm commitment (cash flow hedge) or (d) a hedge of a net investment in a foreign entity. The maximum exposure to credit risk is represented by the carrying amount of each financial asset, including derivative Changes in the fair value of derivatives that are designated and financial instruments, in the consolidated statement of finan- qualify as fair value hedges and that are highly effective are cial position. recorded in the statement of income, along with any changes in the fair value of the hedged asset or liability that is attributable to the hedged risk.

146 147

257.indd 147 07.04.2011 14:32:35 257.indd 148 Financial Information are recognizedthe statement immediately ofincome. in for qualify hedgeaccounting donot that ments underIAS 39 in IAS 39.the fair Changesin value ofany derivative instru- formay qualify hedgeaccounting not the specificrules under the Group’snomic hedgesunder policies, riskmanagement Certain derivativetransactions, whileproviding effective eco- the foreignof entity. equity aretransferred the statement ofincometo ondisposal in currencytranslation adjustments. The amounts deferred in are recognizedthe statement ofincome outside andincluded investment arethat asnet qualify hedgesand highlyeffective the fairChanges in value ofderivatives arethat designated and statement ofincome. as interest payments, orhedgedfirmcommitments, affectthe the cashflows,expensethe sameperiodsduringwhich in such ferredthe statement ofincometo andclassifiedasrevenue or or liability. Otherwise, amounts deferred inequityaretrans- the initialmeasurementthe non-financialasset included in of previously deferred inequityaretransferred from equityand property, andequipment, plant oraliability,the gainsorlosses commitment resultsthe recognition in ofanasset, for example, recognizedthe statement ofincome. outside Wherethe firm arethat ascashflowhedgesand highlyeffectivequalify are the fairChanges in value ofderivatives arethat designated and consolidated equityofGroup Holcim. flow hedgingreserve arethe statement of changesin shownin ing purposesare disclosedinnote31. Movementsthe cash in The fair values ofvarious derivative instruments usedfor hedg- foreign investments. translationhedged itemsincluding gainsandlossesinhedged effective inoffsetting changesinfair values orcashflows of the derivatives arethat transactions are usedinhedging highly hedgeinception andonanongoingbasis,both at ofwhether in foreign entities. The Group alsodocuments itsassessment, to specificfirmcommitmentsto investmentsand liabilitiesor or linking allderivativesto specificassets designated ashedges varioustransactions.undertaking hedge This process includes objectiveas wellitsriskmanagement andstrategy for relationship betweenhedginginstruments andhedgeditems thetransaction the The Group the inceptionof documents at hedged item. orlossoverto profit the remaining item isamortized lifethe of fair value hedge, any valuation relating adjustment to ahedged transferredately the statement ofincome.to the caseofa In cumulative wasthat inequityisimmedi- reported gainorloss committedtransactionto occur, is nolongerexpected the the committedtransactionequity until occurs. However, ifa lative gainorlossrecognizedtime remains that in inequityat the criteriaformeets hedgeaccounting underIAS 39, any cumu- issold,When ahedginginstrument orwhenahedgenolonger 07.04.2011 14:32:35 Fair value estimation The fair value of publicly traded derivatives and available-for- sale assets is generally based on quoted market prices at the

end of the reporting period. The fair value of interest rate swaps Consolidated Statements Financial is calculated as the present value of the estimated future cash flows. The fair value of forward foreign exchange contracts is determined using forward exchange market rates at the end of the reporting period.

In assessing the fair value of non-traded derivatives and other financial instruments, the Group uses a variety of methods and makes assumptions that are based on market conditions existing at the end of the reporting period. Other techniques, such as option pricing models and estimated discounted value of future cash flows, are used to determine fair values for the remaining financial instruments.

The amortized cost for financial assets and liabilities with a maturity of less than one year are assumed to approximate their fair values.

148 149

257.indd 149 07.04.2011 14:32:35 257.indd 150 Financial Information eiaie edfrhdig(oe3)017137 80 137 5 80 0 0 0 5 – Marketablesecurities Available-for-sale financialassets Financial assets 2009 Derivatives heldforhedging(note31) Financial liabilities Derivatives heldforhedging(note31) – Other(note20,26) – Financialinvestmentsinthirdparties – Marketablesecurities Available-for-sale financialassets Financial assets 2010 Million CHF arethat recognized andmeasured fair at value: The followingtable presents the Group’s financialinstruments Level 3 Level 2 Level 1 the fairdisclosing value offinancialinstruments: The Groupthefollowing uses hierarchy for determiningand Fair value hierarchy – Financialinvestmentsinthirdparties Derivatives heldforhedging(note31) – Other Derivatives heldforhedging(note31) Financial liabilities : : Other valuation methodsfor whichallinputs : : Valuation methodswhichuseinputshave a : Quoted (unadjusted)prices in active markets for not based on observablenot market data. s effectignificant the recorded on fair value arethat observable, eitherdirectly orindirectly. have effect asignificant the recorded on fair value are identical assetsorliabilities. ee ee Total Level2 Level 1 0030 0 30 33 5 353 353 0 4 0 000 0 86 87 0 0 07.04.2011 14:32:35 86 87 33 4 Notes to the consolidated financial statements 1 Changes in the scope of consolidation During 2010 there were no business combinations that were

either individually material or that were considered material Consolidated Statements Financial on an aggregated basis.

During 2009 the scope of consolidation has been affected mainly by the following additions and deconsolidations:

Newly included in 2009 Effective as at Holcim Australia October 1, 2009 Cement Australia (50 percent) October 1, 2009

Deconsolidated in 2009 Effective as at United Cement Company of Nigeria Ltd April 1, 2009

On October 1, 2009, Holcim acquired 100 percent of the The identifiable assets and liabilities arising from the acquisi- share capital of Holcim Australia (formerly Cemex Australia), tion are as follows: including its 25 percent interest in Cement Australia. Assets and liabilities arising from the acquisition As a result of the acquisition of Holcim Australia, Holcim’s of Holcim Australia and Cement Australia (consolidated) interest in Cement Australia increased from 50 percent to Million CHF Fair Carrying 75 percent. Until September 30, 2009, Holcim accounted for value amount1 Cement Australia as a joint venture and proportionately Current assets 648 648 consolidated its 50 percent interest. As from October 1, 2009, Property, plant and equipment 1,852 1,635 Cement Australia has been fully consolidated. Other assets 227 304 Short-term liabilities (492) (479) Long-term provisions (238) (148) Other long-term liabilities (372) (383) Net assets 1,625 1,577

Previously held net assets of Cement Australia (50 percent) (201) Non-controlling interest in Cement Australia (25 percent) (100) Net assets acquired 1,324

Total purchase consideration (cash) 1,725 Fair value of net assets acquired (1,324) Goodwill 401

1 Excluding goodwill previously included in the accounts of Cement Australia.

150 151

257.indd 151 07.04.2011 14:32:35 257.indd 152 Financial Information ciate zero at cost. respectivelythe recognition and ofaninvestment inanasso- 533million 476 millionandCHF to CHF liabilities amounting derecognizing itsproportionate interesttotal assetsand of influence. the above of resultedThe impact inGroup Holcim investment inanassociate asaresult ofretaining significant deconsolidated control asjoint ceasedandrecognized asan On April1, 2009, Company UnitedCement ofNigeria Ltd higher, respectively. 123millionincome 1,268millionandCHF wouldhave beenCHF had occurred onJanuary1, 2009, salesandnet Group net from 1, October 2009,to December31, 2009.the acquisition If the Groupto forthe period 40million income ofCHF buted net Holcim Australia andCement Australia (50percent) contri- reserves. mineral the goodlocations,including andstrategic of importance both HolcimAustralia andCement Australia enjoyinAustralia, the favorableto The goodwillisattributable presencethat the accountsthe formerin of venture joint Cement Australia. lion, 98millionhadbeenpreviously recognized ofwhichCHF 401mil- transaction isCHF total goodwillarisingfromthis The was was the HolcimGroup”to 198. onpages196 companiesthe section isincludedin “Principal companies of An overviewthe subsidiaries, of ventures joint andassociated remained substantially unchanged. January 1, 2010, income wouldhave salesandnet Group net in aggregate innote40.the acquisitionshadoccurred If on Business combinations material are individuallynot included 07.04.2011 14:32:35 2 Foreign currencies The following table summarizes the principal exchange rates that have been used for translation purposes. Consolidated Statements Financial Statement of income Statement of financial position Average exchange rates in CHF Year-end exchange rates in CHF 2010 2009 ±% 31.12.2010 31.12.2009 ±% 1 EUR 1.38 1.51 –8.6 1.25 1.49 –16.1 1 GBP 1.61 1.70 –5.3 1.45 1.66 –12.7 1 USD 1.04 1.09 –4.6 0.94 1.03 –8.7 1 CAD 1.01 0.95 +6.3 0.94 0.98 –4.1 100 MXN 8.24 8.02 +2.7 7.56 7.88 –4.1 100 INR 2.28 2.24 +1.8 2.09 2.21 –5.4 100 THB 3.27 3.15 +3.8 3.09 3.08 +0.3 1,000 IDR 0.12 0.11 +9.1 0.10 0.11 –9.1 100 PHP 2.31 2.28 +1.3 2.14 2.23 –4.0 1 AUD 0.96 0.86 +11.6 0.95 0.93 +2.2

152 153

257.indd 153 07.04.2011 14:32:35 257.indd 154 Financial Information 3 Information by reportable segment byreportable 3 Information ahfo agni 481. . . 4317.0 3 959 3,442 5,561 14.3 6 570 3,387 845 3,844 5,315 2 6.8 493 12 6,587 (123) 4,000 9,240 372 879 8.0 235 3 5,375 26.3 7,532 (168) 7,882 922 790 12.6 260 (2) 8,241 23.0 6,809 (33) 1,076 16,430 1 1,368 40 (197) 32.1 1,076 14.8 6,793 923 14,379 (2) 10,551 999 1.1 456 24 172 3,348 1,062 44 (209) 999 3,348 29.0 100 8,738 968 35 (5) 3.1 51 3,442 172 (360) 3,442 400 19 11.5 400 483 Acquisition costsegmentassets Cash flowmarginin% 24 (6) 6.6 Cash flowfromoperatingactivities 3,324 (28) (360) 3,480 14.2 460 Total liabilities 460 393 Total assets 3,480 Net operatingassets 3,442 3,240 (749) 6.0 (2) Investments inassociates 16.8 1,232 406 EBITDA 826 3,240 Other financialincome 3,480 7,320 Share ofprofitassociates (652) Other (expenses)income 1,045 16.0 328 1,409 impairment ofnon-operatingassets 717 5,911 Depreciation, amortizationand 3,240 6,535 113 Operating profitmarginin% Operating profit 1,133 5,402 impairment ofoperatingassets 7,207 Depreciation, amortizationand 144 Operating EBITDAmarginin% – ofwhichemergingmarkets – ofwhichmaturemarkets 6,391 Operating EBITDA – ofwhichemergingmarkets – ofwhichmaturemarkets Total netsales Net salestoothersegments Net salestoexternalcustomers Million CHF cial positionandstatementofcashfl Statement ofincome,statementfi Sales ofready-mixconcrete 3 2 1 Number ofpersonnel Personnel – ofwhichmaturemarkets – ofwhichemergingmarkets Annual cementproductioncapacity Million t Capacity andsales activities Cash flow(usedin)frominvesting Impairment loss Sales ofcement Sales ofaggregates Sales ofmineralcomponents – ofwhichemergingmarkets – ofwhichmaturemarkets – ofwhichemergingmarkets – ofwhichmaturemarkets Sales ofasphalt Million m Included indepreciation, amortizationandimpairmentof operating andnon-operatingassetsrespectively. Refer furthertotheconsolidatedstatement ofcashflows, footnote 1. Net investmentsinproperty,plantand equipment,Groupcompanies,financial assets,intangibleandotherassets. Property, plantandequipmentintangible assets. 2 3 3 1 ows nan- Europe 19,690 (625) 2010 16.0 14.1 50.0 69.4 77.6 26.2 16.3 (51) 750 1.9 1.6 9.9 8.2 5.7 20,800 (108) (256) 2009 17.0 14.7 16.1 49.4 26.9 10.8 70.0 78.4 798 2.3 1.5 5.6 8.4 North America 6,668 2010 11.1 11.1 23.2 39.2 39.2 601 101 5.6 5.6 1.5 4.9 (3) 8,016 (437) 2009 20.6 10.7 10.7 40.2 40.2 (20) 474 5.5 5.5 1.3 5.4 Latin America 12,710 (316) 2010 10.5 10.5 12.2 22.7 22.7 33.4 12.2 312

07.04.2011 14:32:35 12,626 (415) 2009 10.1 10.1 31.0 11.8 11.8 22.8 22.8 397 Africa Middle East Asia Pacific Corporate/Eliminations Total Group 2010 2009 2010 2009 2010 2009 2010 2009 Consolidated Statements Financial 11.2 11.2 93.7 90.7 211.5 202.9 8.9 8.8 71.4 67.3 (3.6) (4.6) 136.7 131.9 4.7 3.2 (0.6) (0.5) 31.5 29.5 8.9 8.8 66.7 64.1 (3.0) (4.1) 105.2 102.4 1.0 0.7 4.1 3.5 2.5 2.6 26.4 10.4 157.9 143.4 23.2 7.3 131.8 117.5 2.5 2.6 3.2 3.1 26.1 25.9 10.6 11.0

1.1 1.1 12.7 8.1 45.9 41.8 5.8 1.9 25.5 22.1 1.1 1.1 6.9 6.2 20.4 19.7

1,098 1,204 7,482 5,917 21,653 21,132 2 476 501 (620) (640) 1,098 1,206 7,958 6,418 (620) (640) 21,653 21,132 2,319 977 (305) (305) 10,656 10,063 1,098 1,206 5,639 5,441 (315) (335) 10,997 11,069 359 373 1,820 1,760 (170) (211) 4,513 4,630 402 214 (57) (63) 1,522 1,377 359 373 1,418 1,546 (113) (148) 2,991 3,253 32.7 30.9 22.9 27.4 20.8 21.9

(55) (56) (589) (459) (29) (28) (1,894) (1,849) 304 317 1,231 1,301 (199) (239) 2,619 2,781 27.7 26.3 15.5 20.3 12.1 13.2

(1) (2) (30) 1 (40) (9) (16) (28) (40) (55) (197) 394 7 206 8 12 213 255 245 302 1 45 24 106 4 183 82 343 346 1,834 1,743 (18) 441 4,988 5,229 2 2 72 59 1,184 1,293 1,432 1,529 695 842 9,371 9,331 204 275 29,817 32,375 1,250 1,407 14,095 14,434 1,338 2,134 44,259 49,206 620 739 4,030 3,860 2,933 4,293 23,138 27,162 247 294 1,572 1,680 119 186 3,659 3,888 22.5 24.4 19.8 26.2 0.0 0.0 16.9 18.4 97 90 580 819 14 3 1,854 2,581

(98) (112) (233) (492) (691) (2,718) (1,362) (4,430) (1) (1) (4) (7) (6) (65) (136)

2,213 2,256 38,172 36,858 857 942 80,310 81,498

154 155

257.indd 155 07.04.2011 14:32:36 257.indd 156 Financial Information Net incomebeforetaxes Financial expenses Interest earnedoncashandmarketablesecurities Depreciation, amortizationandimpairmentofnon-operatingassets Depreciation, amortizationandimpairmentofoperatingassets EBITDA Other financialincome Share ofprofitassociates Depreciation, amortizationandimpairmentofnon-operatingassets Other income Operating EBITDA Acquisition costsegmentassets Net operatingassets Operating profit Operating EBITDAmarginin% Operating EBITDA Total netsales Net salestoothersegments Net salestoexternalcustomers Million CHF Statement ofincome,statementfinancialpositionandcashflows Cash flow(usedin)frominvestingactivities Number ofpersonnel Personnel 3 2 1 line byproduct 4 Information Depreciation, amortizationandimpairmentofoperatingassets Operating profit Million CHF Reconciling measuresofprofitandlosstotheconsolidatedstatementincomeGroupHolcim of cashﬂows, footnote1. Net investmentsinproperty,plantand equipment,Groupcompanies,ﬁnancial assets,intangibleandotherassets.Referfurthertotheconsolidated statement Property, plantandequipmentintangible assets. Cement, clinkerandothercementitious materials. 2 3 oe 002009 2010 Notes 13 12 12 11 23 184 (1,849) (1,894) 9 9 9 9 Cement 1 159 (2,490) (1,529) 99720,944 19,907 39813,808 13,948 25212,608 12,572 11350,335 51,133 4,513 4,988 2,236 2,619 1,894 1,376 1,495 2,551 3,755 (897) 2010 26.9 (40) 183 245 79 40 7 4,630 2,581 5,229 2,781 1,849 1,200 2,260 3,924 2,730 (881) 2009 07.04.2011 14:32:36 28.4 206 302 (9) 91 82 9 Consolidated Statements Financial

Aggregates Other construction materials Corporate/Eliminations Total Group and services 2010 2009 2010 2009 2010 2009 2010 2009

1,571 1,391 7,510 7,133 21,653 21,132 924 745 597 509 (2,897) (2,454) 2,495 2,136 8,107 7,642 (2,897) (2,454) 21,653 21,132 530 421 228 285 4,513 4,630 21.2 19.7 2.8 3.7 20.8 21.9 198 102 (130) (51) 2,619 2,781 5,822 6,723 4,088 4,708 29,817 32,375 168 140 188 179 3 2 1,854 2,581 (76) (1,620) (154) (138) 397 (182) (1,362) (4,430)

6,478 6,850 22,577 23,725 122 588 80,310 81,498

156 157

257.indd 157 07.04.2011 14:32:36 257.indd 158 Financial Information Change instructure Volume andprice Million CHF sales 6 Changeinnet and intangibleand equipment assets. assetsfor ofproperty,this purposeconsist Non-current plant location ofassets(originsales). to external sales customersaretheNet basedprimarilyon Million CHF bycountry 5 Information Total Group Remaining countries India Australia United Kingdom USA Switzerland Total Currency translationeffects to externalcustomers Net sales 1632,3 24435,476 32,404 21,132 21,653 1361,1 53616,851 15,366 11,918 11,316 ,7 ,7 ,0 3,010 2,506 2,071 2,126 1,975 ,3 ,8 ,1 6,628 5,811 2,289 1,933 ,5 ,1 ,2 5,550 5,326 3,317 3,557 2010 746 0921 2009 2010 2009 0 ,9 2,403 2,390 800 3 ,0 1,034 1,005 737 Non-current assets 1,147 44 (2,510) (444) 12 (1,710) (182) 2010 2 (4,025) 521 2009 07.04.2011 14:32:36 195 7 Production cost of goods sold Million CHF 2010 2009 Material expenses (3,488) (3,309)

Fuel expenses (1,420) (1,383) Consolidated Statements Financial Electricity expenses (979) (952) Personnel expenses (1,852) (1,783) Depreciation, amortization and impairment (1,528) (1,472) Other production expenses (3,079) (2,908) Change in inventory (33) (265) Total (12,379) (12,072)

8 Distribution and selling expenses Million CHF 2010 2009 Distribution expenses (4,582) (4,144) Selling expenses (696) (684) Total (5,278) (4,828)

9 Summary of depreciation, amortization and impairment Million CHF 2010 2009 Production facilities (1,528) (1,472) Distribution and sales facilities (246) (247) Administration facilities (120) (130) Total depreciation, amortization and impairment of operating assets (A) (1,894) (1,849)

Impairment of investments in associates (30) 0 Ordinary depreciation of non-operating assets (4) (9) Unusual write-offs (6) 0 Total depreciation, amortization and impairment of non-operating assets (B) (40) (9)

Total depreciation, amortization and impairment (A+B) (1,934) (1,858) Of which depreciation of property, plant and equipment (1,711) (1,603)

10 Change in operating EBITDA Million CHF 2010 2009 Volume, price and cost (284) (270) Change in structure 188 (39) Currency translation effects (21) (394) Total (117) (703)

158 159

257.indd 159 07.04.2011 14:32:36 257.indd 160 Financial Information amortized cost. amortized penses” relateto financialliabilitiesmeasured primarily at The positions “Interest expenses” and “Other financialex- ber 31, 2010, percent (2009: 4.4). was 4.4 The average rate ofinterest Decem- offinancialliabilities at Fair valuechangesonfinancialinstruments Interest expenses Million CHF 13 expenses Financial 171million). ofUSD164million(CHF amount Additionalinfor- relatedthe nationalizationto ofHolcim Venezuelathe in tial realizationthe changeinfair of valuethe compensation of In 2010,the position “Other financialincome”the par- includes Interest earnedoncashandmarketablesecurities Million CHF 12 income Financial Other ordinaryincome Dividends earned Million CHF 11 income Other of Panamá Cement HoldingS.A., Caricement Antilles N.V., position “Other ordinary income”the salethe gain on includes gains onsaleofproperty, andequipment. plant In2009,the In 2010,the position “Other ordinary income” mainlyincludes Amortization onbondsandprivateplacements Total Other financialincome Depreciation, amortizationandimpairmentofnon-operatingassets Unwinding ofdiscountonprovisions Total Other financialexpenses Financial expensescapitalized Foreign exchangegain(loss)net Of whichtoassociates Total and 146. the section is disclosedwithin “Risk management” onpages145 in market interest rates andforeign currency exchange rates Informationthe Group’s about exposurethe riskofchangesto period. expendituresest onlarge-scalethe reporting projects during The position “Financial expenses capitalized” comprises inter- relatesto income primarilyfrom loansandreceivables. receivables –associates” (note22). The remaining amount a negative 42millionon value ofCHF adjustment “Long-term mation isdisclosedinnote21. Further,the positionincludes 85million(note33). ofCHF the amount gation in needed anymorenot relatedinvesti-the Germanantitrust to the release 66millionplus ofaprovision ofCHF the amount Cimenterie Nationale S.E.M. HaitiandCementos Colón S.A. in 79 (780) (789) (102) 87 (881) (897) 2010 2010 2010 (10) (40) (58) 262 183 79 42 57 0 51 7 5 0 2009 2009 2009 07.04.2011 14:32:36 (17) (98) (78) 206 202 173 (9) (3) (2) (1) 91 82 97 3 14 Income taxes Million CHF 2010 2009 Current taxes (602) (742)

Deferred taxes (13) 119 Consolidated Statements Financial Total (615) (623)

As a last restructuring step following the buyout of the non- lion (CHF 178 million) on the capital gain appears as of the controlling interest in Holcim (Canada) Inc., Holcim (US) Inc. first quarter 2010 in deferred taxes. However, this charge is transferred in the first quarter 2010 its entire stake in Holcim cash-neutral as it is fully offset by tax losses carried forward. (Canada) Inc. to its parent company Holcim Ltd. As a consequence, Holcim (US) Inc. realized a capital gain in the amount Current taxes include an income of CHF 94 million (2009: 12) of CHF 509 million, which is eliminated in the Group’s consoli- relating to prior years. dated accounts. The non-recurring tax charge of USD 171 mil-

Deferred tax by type Million CHF 2010 2009 Property, plant and equipment 49 (45) Intangible and other long-term assets (12) (8) Provisions (39) 60 Tax losses carryforward 4 135 Other (15) (23) Total (13) 119

Reconciliation of tax rate 2010 2009 Group’s expected tax rate 36% 30% Effect of non-deductible or non-taxable items and income taxed at different tax rates (5%) (6%) Net change of unrecognized tax loss carryforwards 2% 0% Prior year and other items (5%) 0% Group’s effective tax rate 28% 24%

The Group’s expected tax rate is a weighted average tax rate The increase in 2010 is largely based on a change of the relative based on profits (losses) before taxes of the Group companies. weight of the profit at the Group companies, which includes the effect of the internal transfer of the investment in Holcim (Canada) Inc. (see above).

15 Research and development Research and development projects are carried out with a view (2009: 17) were charged directly to the consolidated statement to generate added value for customers through end user oriented of income. No significant costs were incurred for licenses products and services. Additionally, process innovation aims obtained from third parties, nor was any major revenue generat environmental protection and production system improve- ated from licenses granted. ments. Research and development costs of CHF 15 million

160 161

257.indd 161 07.04.2011 14:32:36 257.indd 162 Financial Information Bank overdrafts are includedincurrent financialliabilities. liquid investments. deposits heldoncallwithbanks andothershort-term highly Cash andcashequivalents comprise banks cashat andinhand, Cash atbanksandinhand Million CHF 17 equivalents cash and Cash this cashpayment, reflect willbeeffective sinceit in2011only. May 5, 2011. These consolidated financialstatements donot the annualgeneralbe proposed at meetingofshareholders on share, 480million,total payoutto a amounting ofCHF to is 1.50perregisteredthe financialyear of 2010ofCHF respect the capitalcontribution of A cashpayment reserve out in 480million. total ordinary dividendpayment ofCHF 1.50perregisteredCHF share hasbeenpaid. This resulted ina meeting onMay 6, 2010, acashdividendrelatedto 2009of In conformitytakenthe annualgeneralthe decision at with Earnings pershareinCHF 16 share per Earnings Fully dilutedearningspershareinCHF Weighted averagenumberofsharesoutstanding Net income–shareholdersofHolcimLtdasperstatement(inmillionCHF) Cash andcashequivalentsforthepurposeofconsolidatedstatementflows Bank overdrafts Total Short-term deposits Weighted averagenumberofsharesfordilutedearningspershare Adjustment forassumedexerciseofshareoptions Weighted averagenumberofsharesoutstanding Net incomeusedtodeterminedilutedearningspershare(inmillionCHF) 1,8,0 298,137,630 319,980,805 2,0,2 298,291,381 320,206,124 298,137,630 319,980,805 2,1 153,751 225,319 ,6 4,261 3,069 ,8 4,474 3,386 ,9 3,603 2,596 ,8 1,471 1,182 ,8 1,471 1,182 37 (213) (317) 2010 2009 2010 3.69 3.69 790 2009 07.04.2011 14:32:37 4.93 4.93 871 18 Accounts receivable Million CHF 2010 2009 Trade accounts receivable – associates 56 84

Trade accounts receivable – third parties 2,054 2,276 Consolidated Statements Financial Other receivables – associates 35 539 Other receivables – third parties 436 497 Derivative assets 95 Total 2,590 3,401 Of which pledged/restricted 115 112

Overdue accounts receivable Million CHF 2010 2009 Not overdue 2,146 2,879 Overdue 1 to 89 days 334 368 Overdue 90 to 180 days 99 126 Overdue more than 180 days 194 245 ./. Allowances for doubtful accounts (183) (217) Total 2,590 3,401

Due to the local nature of the business, specific terms and con- The overdue amounts relate to receivables where payment ditions for accounts receivable trade exist for local Group com- terms specified in the terms and conditions established with panies and as such Group guidelines are not required. Holcim customers have been exceeded.

Allowance for doubtful accounts Million CHF 2010 2009 January 1 (217) (179) Change in structure 0 (5) Allowance recognized (32) (52) Amounts used during the year 12 3 Unused amounts reversed during the year 12 4 Currency translation effects 42 12 December 31 (183) (217)

19 Inventories Million CHF 2010 2009 Raw materials and additives 312 310 Semifinished and finished products 940 1,022 Fuels 314 287 Parts and supplies 472 504 Unbilled services 34 39 Total 2,072 2,162

In 2010, the Group recognized inventory write-downs to net amount of inventories carried at net realizable value was realizable value of CHF 6 million (2009: 12). The carrying CHF 42 million (2009: 63).

162 163

257.indd 163 07.04.2011 14:32:37 257.indd 164 Financial Information was classifiedasheld for sale. December 31, 2008. Inaccordance 5,the investment withIFRS due diligence. Holcim Venezuela was deconsolidated asof principle regardingthe compensationto bepaid, to subject randum ofUnderstandingalsoreflected anagreement in andHolcimwouldkeepment astake of15 percent. The Memo- Holcim Venezuela’s sharestransferred wouldbe the govern-to negotiation ofafinalsalesagreement bywhich85percent of the governmentbetween andHolcim, whichprovides forthe consultations, aMemorandum ofUnderstandingwas signed Investment Treaties. 18, OnAugust 2008,these asaresult of the compensationthe applicableBilateral Holcimisdueunder the governmentand have engaged inconsultations regarding On June18, 2008,the respective decree was published. Holcim threethe foreign producers cement operatingthe country. in would nationalizethe share 60percent of capitalof least at In April2008,the Venezuelan government itthat announced groups. ofindividuallyimmaterialsale consist assetsanddisposal HolcimVenezuela. The remaining assetsclassifiedasheldfor 214millioninyearFinancial 2009relatedto assetsofCHF Other currentassets Million CHF sale are asfollows: The majorclassesofassetsandliabilitiesclassifiedasheldfor sale for held as classified 21 Assets note 21. Republic of Venezuela. Additionalinformation isdisclosedin lion) relatingto acompensation receivable fromtheBolivarian 90mil- ofUSD96million(CHF This positionincludesanamount assets current other and expenses Prepaid 20 Property, plantandequipment Financial assets Other long-termassets Assets classifiedasheldforsale assets classifiedasheldforsale Liabilities directlyassociatedwith Net assetsclassifiedasheldforsale 002009 2010 18 18 18 0 0 0 0 234 214 234 18 0 1 1 cial income”. 171million)was164 million(CHF realizedthrough “other finan- 426million)ofwhichUSDto USD410million(CHF amounted (see alsonote20and26). The resulting changeinfair value of USD97.5 inSeptember2011 92million)starting million(CHF to bepaidinfour 367 million) (CHF equalyearly installments the remainingwith compensation ofUSD390million amount 244million)waslion (CHF received onSeptember10, 2010, 611million),(CHF down-payment ofUSD260mil- ofwhichafirst The agreedtotal compensation isstillUSD650million amount nationalization.that (ICSID) inconnection with the International Centre for ofInvestment Settlement Disputes international arbitration procedure currently pendingbefore alization ofHolcim(Venezuela) C.A.thethe suspensionof and Venezuela’s compensation payment forthe June2008nation- Bolivarian Republic of Venezuelaterms for agreeingthe on On September4, 2010, HolcimLtdthe with signedasettlement Disputes (ICSID)registered Holcim’s request for arbitration. 2009,the International Centre for ofInvestment Settlement Holcim Venezuela,the by Venezuelan government. OnApril10, full compensation forthe nationalization ofitssubsidiary, the Republic proceedings against of Venezuelato seek inorder On March 20, 2009, Holciminitiated international arbitration 07.04.2011 14:32:37 22 Long-term financial assets Million CHF 2010 2009 Financial investments – third parties 58 94

Long-term receivables – associates 682 313 Consolidated Statements Financial Long-term receivables – third parties 110 189 Derivative assets 71 81 Total 921 677 Of which pledged/restricted 86

In 2010, the position “Long-term receivables – associates” Long-term receivables and derivative assets are primarily includes a negative value adjustment of CHF 42 million (note 12). denominated in CHF, USD and ZAR. The repayment dates vary between one and 29 years. The fair value of long-term receivables and derivative assets amounted to CHF 852 million (2009: 591).

23 Investments in associates Million CHF 2010 2009 January 1 1,529 1,341 Share of profit of associates 245 302 Dividends earned (202) (89) Acquisitions net 49 24 Reclassifications net and impairments 30 (43) Currency translation effects (219) (6) December 31 1,432 1,529

Sales to and purchases from associates amounted to CHF 168 mil- The following amounts represent the Group’s share of assets, lion (2009: 210) and CHF 32 million (2009: 19) respectively. liabilities, net sales and net income of associates:

Aggregated financial information – associates Million CHF 2010 2009 Assets 3,514 3,715 Liabilities (2,146) (2,330) Net assets 1,368 1,385

Net sales 1,951 1,853 Net income 229 138

Net income and net assets also reflect the unrecognized share of losses of associates where equity accounting is discontinued as the carrying amount of the investment reached zero. The unrecognized share of losses of associates amounts to CHF 16 million (2009: 102). The accumulated unrecognized share of losses of associates amounts to CHF 64 million (2009: 107).

164 165

257.indd 165 07.04.2011 14:32:37 257.indd 166 Financial Information Of whichpledged/restricted Currency translationeffects Impairment loss(chargedtostatementofincome) Depreciation Transferred fromconstructioninprogress Disposals Additions Change instructure Net bookvalueasatJanuary1 2010 Million CHF e se au flae rpry ln n qimn 0 Net assetvalueofleasedproperty,plantandequipment Net bookvalueasatDecember31 Accumulated depreciation/impairment At costofacquisition Net bookvalueasatDecember31 Change instructure Net bookvalueasatJanuary1 2009 Of whichpledged/restricted Impairment loss(chargedtostatementofincome) Depreciation Transferred fromconstructioninprogress Disposals Additions to CHF 66million(2009: 55). to CHF gainsonsaleofproperty,Net amounted andequipment plant million(2009: 33,912 36,144).to CHF amountedand equipment At December31, 2010,the fire insurance value ofproperty, plant sents 57.9 percent (2009: ofallassets.the originalcost 59.7)of repre- million(2009: 23,343 bookvalue 25,493) The net ofCHF equipment and plant 24 Property, e se au flae rpry ln n qimn 1 Net assetvalueofleasedproperty,plantandequipment Net bookvalueasatDecember31 Accumulated depreciation/impairment At costofacquisition Net bookvalueasatDecember31 Currency translationeffects 107 413 984 213 8)(17,208) (81) (2,103) (9,894) (4,113) (1,017) ,8 ,0 ,6 ,1 ,8 23,262 4,687 1,419 8,169 4,303 4,684 ,5 ,1 ,7 ,6 ,4 23,343 2,240 1,262 23,343 2,240 9,472 1,262 5,316 9,472 5,053 5,316 5,053 ,8 ,3 ,6 ,1 ,9 25,493 2,998 1,512 9,765 5,633 5,585 ,8 ,3 ,6 ,1 ,9 25,493 2,998 1,512 25,493 2,998 9,765 1,512 5,633 9,765 5,585 5,633 5,585 ,0 ,4 96936530942,701 3,079 3,615 19,659 9,746 6,602 ,3 ,0 92533423040,303 2,330 3,394 19,235 9,307 6,037 18 28 85 (312) (875) (298) (118) 19 33 97 (302) (947) (333) (129) 94 391 973 212 9)(16,960) (90) (2,132) (9,763) (3,991) (984) (103) 43 55 84 19 16 (2,197) (176) (109) (884) (555) (473) adBuildings, Land (15) (40) 6 ,3 ,0 3 (3,951) 239 2,006 1,539 167 168 707 (4) 67 74 36 32 installations property amounted to CHF 2million(2009: 3). to CHF amountedproperty 87million(2009: 117).CHF Rental income relatedto investment The fair valuethis investment of to amounted property 87million (2009: bookvalue withanet property 94). ofCHF Included inland, buildingsandinstallations isinvestment the statement ofincome.of goodssoldin Hungary, SpainandIndiaisincludedinproduction cost In 2010, lossrelatesthe impairment to plants in primarily 1)(21) (13) (18) (21) (21) 3)(5 (39) (35) (32) 0 ,9 4 (2,122) 143 1,396 509 6 (10) (6) 9168 59 14 5169 75 228130 218 52 48 55 3135 23 Machines 31 23 4 Furniture, vehicles, tools 3 8)(132) (80) (3) 4 1)(42) (18) (4) 91 92292,507 2,209 39 68 15 39 51561,821 1,516 25 Construction in progress 1 (147) (1) 1436 71 31,170 63 2142 42 (163) 0 (1,603) 0 177 0 140 0 (1,711) 0 Total 07.04.2011 14:32:37 210 333 0 0 25 Intangible assets Goodwill Other Total intangible

assets Consolidated Statements Financial Million CHF 2010 Net book value as at January 1 8,926 1,057 9,983 Change in structure 31 14 45 Additions 23133 Disposals (27) (4) (31) Amortization 0 (119) (119) Impairment loss (charged to statement of income) (23) 0 (23) Currency translation effects (765) (62) (827) Net book value as at December 31 8,144 917 9,061

At cost of acquisition 8,179 1,541 9,720 Accumulated amortization/impairment (35) (624) (659) Net book value as at December 31 8,144 917 9,061

2009 Net book value as at January 1 8,378 928 9,306 Change in structure 3951 174 569 Additions 30 44 74 Disposals (3) 0 (3) Amortization 0 (119) (119) Impairment loss (charged to statement of income) (4) 0 (4) Currency translation effects 130 30 160 Net book value as at December 31 8,926 1,057 9,983

At cost of acquisition 8,938 1,562 10,500 Accumulated amortization/impairment (12) (505) (517) Net book value as at December 31 8,926 1,057 9,983

The other intangible assets included above have finite useful lives, over which the assets are amortized.

The amortization expense relating to intangible assets with finite useful lives is recognized mainly in administration expenses.

1 Included in this amount is the net goodwill arising on the acquisition of Holcim Australia and Cement Australia (consolidated) in the amount of CHF 303 million.

166 167

257.indd 167 07.04.2011 14:32:37 257.indd 168 Financial Information 1 Carrying Cash generatingunit Key assumptionsusedforvalue-in-usecalculationsinrespectofgoodwill2010 countedthe weighted average using ofcapital(WACC). cost exceedsunit itsrecoverable amount. Future cashflows are dis- only recognizedthe cashgenerating of the carryingamount if use, iscomparedto itscarryingamount. lossis Animpairment generating unit, whichhasbeendeterminedbasedonvalue-in- Fortest, the impairment the recoverable ofacash amount significant. ating unitsisindividuallynot the othercashgener-to of goodwillallocatedcarrying amount ofgoodwill,total carryingamount the parison with the while the countries orregions stated incom- belowissignificant country-related. to ofgoodwillallocatedThe carryingamount arethe basisofgeographical definedon market, normally tive businesscombination. The Group’s cashgenerating units the respec- fromthesynergies arethat of to benefit expected a cashgeneratingto agroup orofcashgenerating unit units Fortesting, the purposeofimpairment to goodwillisallocated goodwill for tests Impairment Total Cash generatingunit Key assumptionsusedforvalue-in-usecalculationsinrespectofgoodwill2009 Total Others Mexico Central Europe United Kingdom North America India Million CHF Others Mexico Central Europe United Kingdom North America India Million CHF Individually notsigniﬁ 1 1 cant. with the respectivewith cashgenerating units. key assumptionsarethe risks useddependingonassociated goodwillpositions,individually significant exceptdifferentthat model andparametersimpairment are used,the casewith asis to the goodwillallocated of In respect “Others”,the same generating operates. unit average rate growth forthe relevant the cash market inwhich the four-year exceed perioddoesnot the long-term budget rategrowth to extrapolate used cashflowprojections beyond steady orincreasing sustainablecashflows. Inany event,the the four-year periodare budget extrapolated basedeitheron planning periodapproved bymanagement. Cash flows beyond The cashflowprojections are basedonafour-year financial Total 2010 Total 2009 amount of amount of goodwill goodwill Carrying 8,144 8,926 1,660 ,6 S/A .%2.4% 7.7% USD/CAD 1,765 ,1 S/A .%2.5% 9.0% USD/CAD 1,918 1,701 ,4 aiu .%1.%1.2%–7.5% 6.7%–14.7% Various 3,043 ,5 aiu .%1.%2.0%–7.0% 6.2%–13.9% Various 3,355 962 6 H/U .%1.5% 7.5% CHF/EUR 562 1 X .%4.0% 7.9% MXN 413 2 X .%4.9% 9.0% MXN 428 830 3 H/U .%2.0% 6.6% CHF/EUR 433 urnyPre-tax Currency urnyPre-tax Currency B .%2.5% 8.8% GBP B .%2.8% 8.0% GBP N 14 8.1% 11.4% INR N 25 8.0% 12.5% INR discount discount rate rate growth rate growth rate Long-term Long-term 07.04.2011 14:32:37 GDP GDP Sensitivity to changes in assumptions With regard to the assessment of value-in-use of a cash generating unit or a group of cash generating units, management

believes that a reasonably possible change in the pre-tax dis- Consolidated Statements Financial count rate of 1 percentage point would not cause the carrying amount of a cash generating unit or a group of cash generating units to materially exceed its recoverable amount.

26 Other long-term assets This position includes an amount of USD 280 million the Bolivarian Republic of Venezuela. Additional information is (CHF 263 million) relating to a compensation receivable from disclosed in note 21.

27 Joint ventures The following amounts represent the effect of proportionately The amounts are included in the consolidated statement of consolidated assets, liabilities and sales and results of signifi- financial position and consolidated statement of income. cant joint ventures disclosed on pages 196 and 197.

Statement of financial position Million CHF 2010 2009 Current assets 98 93 Long-term assets 366 368 Total assets 464 461

Short-term liabilities 57 49 Long-term liabilities 102 102 Total liabilities 159 151

Net assets 305 310

Statement of income Million CHF 2010 2009 Net sales 343 617

Operating profit 53 102

Net income from joint ventures 35 64

Sales to and purchases from significant joint ventures amounted As from October 1, 2009, the formerly proportionately consoli- to CHF 5 million (2009: 29) and CHF 95 million (2009: 64) dated interest in Cement Australia has been fully consolidated respectively. (note 1). Mainly due to this reason, the proportionately consolidated sales and results of significant joint ventures have decreased compared to the prior year.

168 169

257.indd 169 07.04.2011 14:32:37 263.indd 170 Financial Information CHF 13,706 million(2009:CHF 15,313). The fair valuesto oflong-termfinancialliabilitiesamount different fromtheircarryingamounts. The fair values ofcurrent financialliabilitiesare materially not Long-term financialliabilities–associates Total currentfinancialliabilities Derivative liabilities Current portionoflong-termfinancialliabilities Current financialliabilities–thirdparties Current financialliabilities–associates Million CHF liabilities 29 Financial fromtheir carryingamounts. The fair values ofaccounts payable are materially different not Trade accountspayable–associates Million CHF payable 28 Trade accounts Derivative liabilities Long-term financialliabilities–thirdparties Advance paymentsfromcustomers Trade accountspayable–thirdparties Of whichsecured Total Total long-termfinancialliabilities Total 47918,307 14,749 22113,854 12,281 21213,761 12,142 ,0 2,223 2,303 ,6 4,453 2,468 ,7 1,520 1,076 ,8 2,928 1,384 ,3 2,087 2,137 2010 2010 167 130 152 14 91 11 74 2009 2009 07.04.2011 14:33:17 206 128 83 0 8 Details of total financial liabilities Million CHF 2010 2009 Loans from financial institutions 4,188 6,264 Bonds and private placements 10,316 11,818 Consolidated Statements Financial Total loans and bonds 14,504 18,082 Obligations under finance leases (note 30) 108 138 Derivative liabilities (note 31) 137 87 Total 14,749 18,307

Loans from financial institutions include amounts due to banks and other financial institutions. Repayment dates vary between one and 15 years. CHF 1,783 million (2009: 3,207) are due within one year.

Unutilized credit lines totaled CHF 8,867 million (2009: 8,188) at year-end 2010, of which CHF 6,378 million (2009: 5,365) are committed.

Financial liabilities by currency Currency 2010 2009 Million CHF In % Interest rate1 Million CHF In % Interest rate1 CHF 3,709 25.1 2.7 3,240 17.7 2.8 USD 4,097 27.8 3.4 5,037 27.5 3.2 EUR 3,105 21.0 4.8 4,822 26.3 4.3 GBP 731 5.0 7.4 893 4.9 7.0 AUD 816 5.5 7.7 1,402 7.7 6.0 INR 262 1.8 5.9 296 1.6 6.4 THB 217 1.5 5.0 234 1.3 5.7 NZD 98 0.7 4.9 112 0.6 3.6 Others 1,714 11.6 6.5 2,271 12.4 7.2 Total 14,749 100.0 4.4 18,307 100.0 4.4

1 Weighted average nominal interest rate on ﬁ nancial liabilities on December 31.

170 171

263.indd 171 07.04.2011 14:33:17 263.indd 172 Financial Information is disclosed in the section the section is disclosedin “Risk management”. Additional informationthe maturity offinancialinstruments on (2009: 1,119). 150millionunder long-termcommitted credit linesofCHF includesshort-term drawings million(2009: 2,468 4,453) CHF and derivative liabilitiesisduewithinoneyear. total ofThe 34million(2009: 37)fromCHF obligations under financeleases of anamount million(2009: 2,434 4,416) the CHF to In addition and showstheremaining contractual maturities. The maturity informationthe carryingamounts isbasedon Total Thereafter Within 5years Within 4years Within 3years Within 2years Within 1year Million CHF Maturity scheduleofloansandbonds are hedgebasis. disclosedonapost Financial arethat to afixed liabilities hedgedorfloating rate Total Financial liabilitiesatvariablerates Financial liabilitiesatfixedrates Million CHF Interest ratestructureoftotalfinancialliabilities 45418,082 14,504 47918,307 14,749 ,0 8,995 6,208 ,4 3,590 1,842 1,412 2,047 3,195 1,824 9,312 8,541 ,8 4,546 4,088 ,3 4,416 2,434 002009 2010 2009 2010 1 2,276 916 07.04.2011 14:33:17 Bonds and private placements as at December 31 Nominal Nominal Effective Term Description Net Net value interest interest book book rate rate value value Consolidated Statements Financial Million CHF 2010 2009 Holcim Ltd CHF 500 2.50% 2.69% 2005–2012 Bonds with fixed interest rate 499 498 CHF 250 3.00% 3.19% 2006–2015 Bonds with fixed interest rate 248 248 CHF 400 3.13% 0.42% 2007–2017 Bonds swapped into floating interest rates at inception 438 431 CHF 1,000 4.00% 4.33% 2009–2013 Bonds with fixed interest rate 991 988 CHF 450 4.00% 4.19% 2009–2018 Bonds with fixed interest rate 444 444 CHF 475 2.38% 2.64% 2010–2016 Bonds with fixed interest rate 469 0 Holcim Capital Corporation Ltd. USD 150 7.05% 1.78% 2001–2011 Private placement guaranteed by Holcim Ltd, 148 169 swapped into floating interest rates at inception USD 208 7.05% 7.08% 2001–2011 Private placement guaranteed by Holcim Ltd 195 215 USD 50 7.65% 7.65% 2001–2031 Private placement guaranteed by Holcim Ltd 47 51 USD 65 6.59% 6.60% 2002–2014 Private placement guaranteed by Holcim Ltd 61 67 USD 100 6.59% 6.59% 2002–2014 Private placement guaranteed by Holcim Ltd 94 103 USD 250 6.88% 7.28% 2009–2039 Bonds guaranteed by Holcim Ltd 226 249 Holcim Overseas Finance Ltd. CHF 300 2.75% 2.79% 2006–2011 Bonds guaranteed by Holcim Ltd 300 300 CHF 250 3.00% 0.42% 2007–2013 Bonds guaranteed by Holcim Ltd, 268 269 swapped into floating interest rates at inception Holcim Finance (Canada) Inc. CAD 10 6.91% 6.92% 2002–2017 Private placement guaranteed by Holcim Ltd 9 10 CAD 300 5.90% 6.10% 2007–2013 Bonds guaranteed by Holcim Ltd 280 293 Holcim Finance (Luxembourg) S.A. EUR 450 4.38% 2003–2010 Bonds guaranteed by Holcim Ltd 0 669 EUR 300 4.38% 2003–2010 Bonds guaranteed by Holcim Ltd, 0 450 swapped into floating interest rates at inception EUR 600 4.38% 4.45% 2004–2014 Bonds guaranteed by Holcim Ltd 747 889 EUR 650 9.00% 8.92% 2009–2014 Bonds guaranteed by Holcim Ltd 814 969 EUR 200 6.35% 6.40% 2009–2017 Private placement guaranteed by Holcim Ltd 249 296 Holcim Finance (Australia) Pty Ltd AUD 500 8.50% 8.90% 2009–2012 Bonds guaranteed by Holcim Ltd 475 461 Holcim Capital (Thailand) Ltd. THB 2,150 6.48% 2005–2010 Bonds guaranteed by Holcim Ltd 0 66 THB 2,450 6.69% 6.78% 2005–2012 Bonds guaranteed by Holcim Ltd 76 75 THB 2,000 3.52% 3.62% 2010–2015 Bonds guaranteed by Holcim Ltd 62 0 Subtotal 7,140 8,210

172 173

263.indd 173 07.04.2011 14:33:17 263.indd 174 Financial Information R 0001.5 05%21–05Floatingratebonds Floatingratebonds 2010–2015 Amortizingfloatingratebonds 2009–2012 10.54% 10.38% 10.15% 2009–2012 Total 10,000 10.00% Bondswithfixedinterestrate CRC 18.32% 8,500 17.54% CRC 63 2009–2013 Holcim (CostaRica)S.A. 4.55% ARS 4.50% Non-convertibledebentureswithfixedinterestrate Juan MinettiS.A. 4,000 THB Non-convertibledebentureswithfixedinterestrate 2009–2014 6.85% 1,000 Siam CityCement(Public)CompanyLimited 8.45% 2008–2013 INR Bondswithfixedinterestrate 8.45% 11.30% 3,000 Ambuja CementsLtd. Industrialrevenuebonds–Midlothian 11.30% 2008–2015 2,000 INR Industrialrevenuebonds–HollyHill 2009–2034 5.49% INR Industrialrevenuebonds–Canada 5.49% 2003–2033 0.28% ACC Limited Industrial revenuebonds–MobileDock&Wharf 1,500 2000–2020 0.28% 0.44% MAD Industrialrevenuebonds–Midlothian 27 1999–2032 0.44% 0.33% Holcim (Maroc)S.A. Industrial revenuebonds–SouthLouisianaPort 25 1999–2031 0.33% 0.31% Industrialrevenuebonds–Devil’sSlide USD 18 1997–2027 0.31% 0.33% USD 67 1996–2031 0.33% 0.37% USD 15 BondsguaranteedbyHolcimLtd 0.50% 0.37% USD 22 0.50% 2009–2017 USD 5 Bonds, partlyswappedintofloatinginterestrates USD 8.81% 2001–2016 USD 8.75% Bonds guaranteedbyHolcimLtd 300 Holcim (US)Inc. 4.33% 2009–2019 GBP 7.25% PrivateplacementguaranteedbyHolcimLtd, 163 Holcim GBFinanceLtd. 6.25% 2008–2015 GBP 6.00% PrivateplacementguaranteedbyHolcimLtd, 750 Aggregate IndustriesHoldingsLimited 1.60% 2008–2013 2.25% USD 202 1.49% 2.10% EUR 358 EUR U 0 51% 14%20–03PrivateplacementguaranteedbyHolcimLtd, PrivateplacementguaranteedbyHolcimLtd 2008–2013 PrivateplacementguaranteedbyHolcimLtd 1.47% 2006–2013 PrivateplacementguaranteedbyHolcimLtd 5.12% 2006–2016 6.01% 90 2006–2018 5.96% 6.14% 125 EUR 6.10% 6.24% 125 USD 6.21% 200 USD USD Holcim USFinanceS.àr.l.&CieS.C.S. Subtotal Million CHF value Nominal rate interest Nominal rate interest Effective 0521 Non-convertibledebentureswithfixedinterestrate 2005–2010 emDsrpinNet Description Term swapped intoUSDatinception swapped intoUSDatinception swapped intoUSDandfloatinginterestratesatinception 03611,818 10,316 ,4 8,210 7,140 value 002009 2010 book 9 760 690 6 197 168 530 446 1 129 129 117 117 6 305 267 1 141 118 8 206 187 5 300 252 3 497 433 261 62 67 62 19 69 17 16 62 14 80 15 18 15 19 15 23 21 244 42 528 25 326 23 22 0 5 5 value book 07.04.2011 14:33:18 Net 30 Leases Future minimum lease payments Operating Finance Operating Finance

leases leases leases leases Consolidated Statements Financial Million CHF 2010 2010 2009 2009 Within 1 year 157 27 167 35 Within 2 years 123 29 144 28 Within 3 years 96 14 117 28 Within 4 years 77 11 98 11 Within 5 years 71 5 87 11 Thereafter 357 63 470 73 Total 881 149 1,083 186 Interest (41) (48) Total finance leases 108 138

Total expenses for operating leases recognized in the consolidated statement of income in 2010 was CHF 170 million (2009: 161). There are no individually significant operating lease agreements.

The liabilities from finance leases due within one year are included in current financial liabilities and liabilities due thereafter are included in long-term financial liabilities (note 29). There are no individually significant finance lease agreements.

174 175

263.indd 175 07.04.2011 14:33:18 263.indd 176 Financial Information Derivative assetsandliabilities Derivative liabilitiesare includedinfinancialliabilities(note29). accounts receivable (note18). than oneyearassets withmaturities less are includedin included inlong-termfinancialassets(note22)andderivative Derivative assetswithmaturities exceeding oneyear are instruments 31 financial Derivative Interest rate Fair valuehedges Million CHF Cross-currency Currency Total fairvaluehedges Interest rate Cash flowhedges Currency Cross-currency Cross-currency Currency Net investmenthedges Total cashflowhedges Total netinvestmenthedges Total Total heldfortrading Cross-currency Currency Interest rate Held fortrading Fair value assets 0021 0020 092009 2009 2009 2010 2010 2010 78 80 78 0 0 000000 0 0 0 0 0 2 2 0 0 0 Fair value liabilities 124 117 3 2,067 137 12 21,013 12 0 00000 3 4 1 00000 1 00000 00000 00000 Nominal amount 863 150 993 823 94 76 61 61 Fair value assets 81 81 86 0 0 0 0 0 5 5 Fair value liabilities 41,049 84 77 72,642 87 1,334 0 1 6 1,499 1 1 2 2 Nominal amount 07.04.2011 14:33:18 165 129 908 94 12 94 32 Deferred taxes Deferred tax by type of temporary difference 2010 2009 Million CHF

Deferred tax assets Consolidated Statements Financial Property, plant and equipment 32 23 Intangible and other long-term assets 40 76 Provisions 171 236 Tax losses carryforward 385 381 Other 309 350 Total 937 1,066

Deferred tax liabilities Property, plant and equipment 2,367 2,614 Intangible and other long-term assets 281 310 Provisions 518 Other 102 101 Total 2,755 3,043

Deferred tax liabilities net 1,818 1,977

Reflected in the statement of financial position as follows: Deferred tax assets (385) (412) Deferred tax liabilities 2,203 2,389 Deferred tax liabilities net 1,818 1,977

Temporary differences for which no deferred tax is recognized Million CHF 2010 2009 On unremitted earnings of subsidiary companies (taxable temporary difference) 3,303 3,749 On tax losses carryforward (deductible temporary difference) 879 732

176 177

263.indd 177 07.04.2011 14:33:18 263.indd 178 Financial Information Total taxlossescarryforwardnotrecognized Of whichreflectedindeferredtaxes Total taxlossescarryforward Million CHF Tax lossescarryforward 1 year Expiring asfollows: 2 years 3 years 4 years 5 years Thereafter Loss carryforwards 142 35 158 (381) (1,508) (385) (1,402) 2,281 0021 092009 2009 2010 2010 879 786 10 35 23 22 3 effect 5 2,240 650 265 242 Tax 9 1 6 5 2 Loss carryforwards 665 732 40 12 10 2 3 effect 07.04.2011 14:33:18 599 218 200 Tax 10 1 1 3 3 33 Provisions Site restoration Specific Other Total Total and other environ- business provisions 2010 2009

mental provisions risks Consolidated Statements Financial Million CHF January 1 585 282 648 1,515 1,375 Change in structure 0 0 3 3 215 Provisions recognized 146 81 216 443 494 Provisions used during the year (37) (42) (126) (205) (270) Provisions reversed during the year (25) (52) (182) (259) (344) Currency translation effects (51) (30) (37) (118) 45 December 31 618 239 522 1,379 1,515 Of which short-term provisions 47 30 179 256 252 Of which long-term provisions 571 209 343 1,123 1,263

Site restoration and other environmental provisions represent Other provisions relate mainly to provisions that have been set the Group’s legal or constructive obligations of restoring a site. up to cover other contractual liabilities. The composition of this The timing of cash outflows of this provision is dependent on item is extremely manifold and comprises, as of December 31, the completion of raw material extraction and the commence- among other things: various severance payments to employees ment of site restoration. of CHF 111 million (2009: 101), provisions for vacation and over- time of CHF 91 million (2009: 99), provisions for health insur- Specific business risks comprise litigation and restructuring ance and pension schemes, which do not qualify as benefit costs which arise during the normal course of business. obligations, of CHF 22 million (2009: 64), provisions related to Provisions for litigations mainly relate to antitrust investiga- sales and other taxes of CHF 71 million (2009: 104) and pro- tions, product liability as well as tax claims and are set up to visions for contingent liabilities arising from business combi- cover legal and administrative proceedings. In 2010, it included nations of CHF 77 million (2009: 89). The expected timing several provisions for risks related to direct and indirect taxes of the future cash outflows is uncertain. of CHF 32 million (2009: 41) and a provision of CHF 21 million (2009: 27) related to the German antitrust investigation set up in 2002. Total provisions for litigations amounted to CHF 180 million (2009: 210) on December 31. The timing of cash outflows of provisions for litigations is uncertain since it will largely depend upon the outcome of administrative and legal proceedings. Provisions for restructuring costs relate to various restructuring programs and amounted to CHF 59 million (2009: 72) on December 31. These provisions are expected to result in future cash outflows mainly within the next one to three years.

178 179

263.indd 179 07.04.2011 14:33:18 263.indd 180 Financial Information costs. The obligation resulting pen- fromthedefinedbenefit the planandany unrecognized service lossesandpast actuarial refunds fromtheplanorreductions infuture contributionsto present value ofany economic benefits availablethe form in of exceed doesnot the isrecorded it that asset the extent to only employee’s compensation andcontribution. pension Anet Benefits arethe respective onyears dependent and ofservice the legal,to ing fiscalandeconomic conditions ofeachcountry. viving dependent’s pensions. The benefitsoffered vary accord- benefits payablethe form in ofretirement, disabilityandsur- plans. Provisions for pensionobligations are establishedfor which, underIFRS, are considered pension asdefinedbenefit Some Group companies provide pensionplansfortheir employees plans pension benefit Defined Group employed 80,310 people(2009: 81,498). million(2009: 4,035 3,939).CHF AsofDecember31, 2010,the the consolidatedin statement of incometo andamounted are recognizedthe relevant in expenditure linebyfunction The Group’stotal personnelexpenses, includingsocialcharges, e iblt rsn rmdfndbnftpninpas22287 74 222 69 Net liability Defined benefitobligations Other long-termassets Reflected inthestatementoffinancialpositionasfollows: Net liability Net liabilityarisingfromotherpost-employmentbenefitplans Net liabilityarisingfromdefinedbenefitpensionplans Million CHF Reconciliation ofretirementbenefitplanstothestatementfinancialposition Marketing andsales Production anddistribution Million CHF Personnel expenses benefits 34 Employee Administration Personnel expenses and number of personnel of number and expenses Personnel Total value of plan assets at the end of the previousvaluethe end of year. ofplanassetsat presentthe fair obligation value and the definedbenefit of unrecognized exceeds amount the greater 10percent of the of employees, cumulativethe net that the extent to only but expected average remaining workinglivesthe participating of arial assumptionsare recognized asincome (expense) overthe Unrecognized gainsandlossesresulting from changesinactu- credit method.the projected unit sion plansisdeterminedusing the statement offinancialposition. the amounts recognizedto plans post-employment benefit in pensionplansandotherunfunded status ofdefinedbenefit The followingtable reconciles the funded, fundedand partially the respective Group companies. covered byprovisionsthe statements in offinancialposition these plansare externallyA numberof funded, not are but the oneusedfor pensionschemes.to definedbenefit similar plans.fit The methodofaccounting forthese provisions is The Group operates anumberofotherpost-employment bene- plans benefit post-employment Other ,3 3,939 4,035 ,5 2,687 2,759 002009 2010 2010 (26) 861 415 291 317 361 291 2009 07.04.2011 14:33:18 (15) 376 407 361 845 Retirement benefit plans Defined benefit Other post-employment pension plans benefit plans Million CHF 2010 2009 2010 2009 Consolidated Statements Financial Present value of funded obligations 2,786 2,793 0 0 Fair value of plan assets (2,405) (2,541) 0 0 Plan deficit of funded obligations 381 252 0 0 Present value of unfunded obligations 225 235 83 89 Unrecognized actuarial losses (379) (237) (14) (15) Unrecognized past service costs (6) (16) 0 0 Unrecognized plan assets 1 53 0 0 Net liability from funded and unfunded plans 222 287 69 74

Amounts recognized in the statement of income are as follows: Current service costs 78 76 1 2 Interest expense on obligations 149 147 4 5 Expected return on plan assets (137) (122) 0 0 Amortization of actuarial losses 62 34 0 0 Past service costs 1400 Losses (gains) on curtailments and settlements 0 3 0 (3) Limit of asset ceiling (50) (27) 0 0 Others (4) 2 0 0 Total (included in personnel expenses) 99 117 5 4

Actual return on plan assets 51 196 0 0

Present value of funded and unfunded obligations Opening balance as per January 1 3,028 2,731 89 95 Current service costs 78 76 1 2 Employees’ contributions 22 24 0 0 Interest cost 149 147 4 5 Actuarial losses (gains) 147 193 (1) (1) Currency translation effects (211) 76 (5) (1) Benefits paid (183) (263) (5) (8) Past service costs 9400 Change in structure (9) 43 0 0 Curtailments (10) (2) 0 (3) Settlements (9) (1) 0 0 Closing balance as per December 31 3,011 3,028 83 89

180 181

263.indd 181 07.04.2011 14:33:18 263.indd 182 Financial Information Expected returnonplanassets Opening balanceasperJanuary1 Fair valueofplanassets Million CHF Retirement benefitplans to be settled. date,the periodoverthe obligationto is which applicable the market pricesprevailingmined basedon that on The overall expected rate ofreturn onplanassetsisdeter- Actuarial (losses)gains Currency translationeffects Contribution bytheemployer Contribution bytheemployees Equity instrumentsofHolcimLtdorsubsidiaries Plan assetsconsistof: Closing balanceasperDecember31 Settlements Change instructure Benefits paid Medical costtrendrate Future salaryincreases Expected returnonplanassets Discount rate Principal actuarialassumptionsusedattheendofreportingperiod Total fairvalueofplanassets Other Land andbuildingsoccupiedorusedbythirdparties Debt instrumentsofthirdparties Debt instrumentsofHolcimLtdorsubsidiaries Equity instrumentsofthirdparties ,0 2,541 2,405 ,0 2,541 2,405 ,4 2,375 2,541 16 (243) (166) (148) 0020 002009 2010 2009 2010 .%49 .%5.4% 4.9% 2.8% 4.9% 2.9% 4.4% .%5.1% 5.4% (86) 109 137 613 846 9 1,031 592 330 (4) 22 23 1 02 Defined benefit pension plans 122 408 754 321 (1) 79 73 85 24 25 700 2 Other post-employment .%8.1% 7.2% (4) 0 0 0 0 0 0 4 0 0 0 0 0 0 0 0 benefit plans 07.04.2011 14:33:18 (7) 0 0 0 0 0 0 7 0 0 0 0 0 0 0 0 Experience adjustments Defined benefit Other post-employment pension plans benefit plans Million CHF 2010 2009 2008 2007 2006 2010 2009 2008 2007 2006 Consolidated Statements Financial Present value of defined benefit obligation 3,011 3,028 2,731 3,292 3,435 83 89 95 112 143 Fair value of plan assets (2,405) (2,541) (2,375) (3,068) (2,939) 0 0 0 (12) (28) Deficit 606 487 356 224 496 83 89 95 100 115 Experience adjustments: On plan liabilities (33) 0 24 (17) 57 (3) (6) (3) 3 0 On plan assets (86) 73 (341) 13 76 0 0 0 0 0

Change in assumed medical cost trend rate A 1 percentage point change in the assumed medical cost trend Increase Increase Decrease Decrease rate would have the following effects: Million CHF Million CHF Million CHF Million CHF 2010 2009 2010 2009 – On the aggregate of the current service cost and interest cost components of net periodic post-employment medical costs 0000 – On the accumulated post-employment benefit obligations for medical costs 5443

Expected contributions by the employer to be paid to the post- employment benefit plans during the annual period beginning after the end of the reporting period are CHF 119 million (2009: 111).

182 183

263.indd 183 07.04.2011 14:33:19 263.indd 184 Financial Information rne n etd(igealtet H 84 7100 67,100 78.43 CHF 385,124 131,631 71.15 CHF Of whichexercisableattheendofyear December 31 Lapsed Exercised Forfeited Granted andvested(singleallotment) Granted andvested(individualcomponentofvariablecompensation) January 1 1 these plansare purchased fromthemarket. No dilutionofHolcimshares occursasallshares granted under 2millionin2010(2009: 2.6). to CHF plans amounted fivenext years. total expenseThe arisingfromtheseshare the employeeThe shares besoldnorpledgedby forthe cannot the sharethe followingthe market priceof in year.based on ispaidinHolcimshares,senior management whichare granted the variable,Part of performance-related compensation of plans share management Senior millionin2010(2009: 5.8). 6.4 shareto CHF planamounted threefor the next years. total expenseThe arisingfromthis the following year. the employeeThe shares besoldby cannot which are grantedthe sharethe market priceof in basedon ofGroupmanagement companies ispaidinHolcimshares, the variable,Part of performance-related compensation for companies Group of management for plan Share 1.7millionin2010(2009: 2). to CHF amounted date ofpurchase. total expenseThe arisingfromthisplan The shares besoldfortwo years cannot aperiodof fromthe market valuethe prior-month basedon average share price. of discounted Holcimshares generallythe 70percent at of nies. This planentitles employeesto acquire alimitedamount of Swiss subsidiariesandsomeexecutives from Group compa- Holcim hasanemployee share ownershipplanfor allemployees plan purchase share Employee plans 35 compensation Share Adjusted toreﬂect formersharesplitsand/orcapitalincreases. their related weighted average exercise pricesare asfollows: Movementsthe numberofshare in optionsoutstandingand the optionsincash. chase orsettle The Group hasnolegalorconstructiveto repur- obligation and pledgerestrictions. related only)ofnineyears fromthedate ofgrant, withsale twelve yearsthe optionshave and avesting period(service- The contractualthe secondtypeofoptionplanisterm of threeperiod of years followingthe grant date. years, withimmediate vestingexercise but restrictions for a type ofoption planiseight The contractual the first term of date ofgrant (seeexplanations onpage108). sharethe sharesthe ofHolcimLtdthe market priceof at at each optionrepresentsto acquire the right oneregistered the Executive Committee uponappointment. Inbothcases, annual variable compensationthose, and whichareto allotted the HolcimGroup,of the ones, whicharethe granted of aspart Twotypes ofshare optionsare grantedto seniormanagement Share option plans egtdaeaeNumber Weighted average exercise price H 38 ,6 6,758 2,865 33.85 CHF H 43 ,5,5 1,054,493 1,250,359 64.37 CHF 676,127 1,054,493 62.55 CHF 00 00 1 5,2 213,112 259,921 002009 2010 1 Number 07.04.2011 14:33:19 1 Share options outstanding at the end of the year have the following expiry dates and give the right to acquire one registered share of Holcim Ltd at the exercise prices as listed below: Consolidated Statements Financial Option grant date Expiry date Exercise price1 Number1 Number1 2010 2009 2002 2014 CHF 67.15 201,300 201,300 2003 20122 CHF 33.85 45,910 48,775 2003 20152 CHF 67.153 33,550 33,550 2004 20132 CHF 63.35 34,341 34,341 2004 20162 CHF 67.153 33,550 33,550 2005 20142 CHF 74.54 71,423 71,423 2006 2014 CHF 100.69 58,573 58,573 2007 2015 CHF 125.34 49,674 49,674 2008 2016 CHF 104.34 71,083 71,083 2008 2020 CHF 67.153 67,100 67,100 2009 2017 CHF 38.26 385,124 385,124 2010 2018 CHF 71.15 131,631 2010 2022 CHF 75.40 33,550 2010 2022 CHF 81.45 33,550 Total 1,250,359 1,054,493

In 2010, options exercised resulted in 2,865 shares being issued All shares granted under these plans are either purchased at an exercise price of CHF 33.85. In 2009, options exercised from the market or derived from treasury shares. The total per- resulted in 6,758 shares having been issued at an exercise price sonnel expense arising from the grant of options based on of CHF 63.35. the individual component of variable compensation amounted to CHF 2.4 million in 2010 (2009: 2.3). The fair value of options granted for the year 2010 using the Black Scholes valuation model is CHF 16.59 (2009: 17.62). The significant inputs into the model are the share price and an exercise price at the date of grant, an expected volatility of 31.6 percent (2009: 30), an expected option life of six years (2009: 6), a dividend yield of 2.2 percent (2009: 1.9) and an annual risk-free interest rate of 1.3 percent (2009: 1.2). Expected volatility was determined by calculating the historical volatility of the Group’s share price over the respective vesting period.

1 Adjusted to reﬂ ect former share splits and/or capital increases. 2 Due to trade restrictions in 2008, the expiry date of the annual options granted for the years 2003 to 2005 has been extended by one year. 3 Valued according to the single allocation in 2002.

184 185

263.indd 185 07.04.2011 14:33:19 263.indd 186 Financial Information Due tocontractcustomersattheendofreportingperiod Progress billingstodate Contract costsincurredandrecognizedprofits(lesslosses)todate Contract revenuerecognizedduringtheyear Million CHF 36 Construction contracts Total shares Total sharesoutofconditionalsharecapital Unreserved Reserved forconvertiblebonds Shares outofconditionalsharecapital – ofwhichissuedonJuly20,2009 – ofwhichissuedonMay26,2009 Total issuedshares Total treasuryshares Unreserved treasuryshares Shares reservedforcalloptions Shares reservedforconvertiblebonds Treasury shares Total outstandingshares December 31 Number ofregisteredshares shares of 37 Details Holcim Ltd resolvedto increasethe company’s share capital On July8, 2009,the extraordinary shareholders’ meeting of the shareholders aratioto dend at ofHolcimLtd (note16). of1:20 share capital. The newHolcimshares were paidasastockdivi- the conversionpaid by offreely disposableequitycapital into registered shares 2. withaparvalue ofCHF The newshares were fullypaid-in ous sharethroughthe issuance of13,179,305 capital) approved 26,358,610 capitalincreasethe previ- (5percent of aCHF The annualgeneral meetingofshareholders ofMay 7, 2009, 476 million(2009:to CHF amount 455). 654million(2009:treasurythe shares 654)and nominal CHF The parvalue 2. pershare isCHF The shareto capitalamounts Due tocustomersforcontractwork Due fromcustomersforcontractwork Of which: 20, 2009,the SIXSwissthe MainStandard ofExchange. under of2011.quarter The newregistered shares were listedonJuly to becompletedthe secondstill pending, isexpected in but announced increasethe share in capitalofHuaxinCement is the plannedprivatein ofHuaxinCement. placement The its strategicthroughthe participation inChina partnership Holdings PtyLtd (note1). Inaddition, Holcimwantedto affirm the acquisition ofCemexceeds wereto finance used Australia lion, which were recognized directly inequity. The cashpro- 2,113million.of CHF Transaction 73mil- coststo CHF amounted tered 42, shares was CHF whichcorrespondedto gross proceeds 2each.value ofCHF The subscriptionpriceforthe newregis- by issuing50,320,981 fullypaid-inregistered shares withapar through 553,530,790 654,172,752 arights issuefrom CHF to CHF 2,0,2 328,508,726 328,508,726 2,8,7 327,086,376 327,086,376 1,5,9 320,180,992 319,955,293 ,2,5 1,422,350 1,422,350 ,3,8 6,905,384 7,131,083 ,5,5 1,054,493 1,250,359 ,2,5 1,422,350 1,422,350 ,8,2 5,785,824 5,785,824 292 (3,151) (2,982) 49065,067 94,900 ,4 1,487 1,341 ,6 3,127 2,963 2010 2010 (19) (42) 23 00 13,179,305 50,320,981 2009 2009 07.04.2011 14:33:19 (24) (50) 26 38 Contingencies, guarantees and commitments Contingencies Commitments In the ordinary course of business, the Group is involved in law- In the ordinary course of business, the Group enters into pur-

suits, claims, investigations and proceedings, including product chase commitments for goods and services, buys and sells Consolidated Statements Financial liability, commercial, environmental, health and safety matters, investments, associated companies and Group companies or etc. There are no single matters pending that the Group portions thereof. It is common practice that the Group makes expects to be material in relation to the Group’s business, offers or receives call or put options in connection with such financial position or results of operations. acquisitions and divestitures.

At December 31, 2010, the Group’s contingencies amounted to At December 31, 2010, the Group’s commitments amounted to CHF 363 million (2009: 436). It is possible, but not probable, CHF 1,236 million (2009: 1,775), of which CHF 342 million (2009: that the respective legal cases will result in future liabilities. 532) relate to the purchase of property, plant and equipment.

The Group operates in countries where political, economic, Holcim has agreed to subscribe to a private placement issued social and legal developments could have an impact on the by its associated company Huaxin Cement Co. Ltd. amounting Group’s operations. The effects of such risks which arise in the to a maximum of CNY 1 billion (CHF 142 million) and so con- normal course of business are not foreseeable and are there- firms its commitment to further deepen the strategic relation- fore not included in the accompanying consolidated financial ship with Huaxin. statements.

Guarantees At December 31, 2010, guarantees issued to third parties in the ordinary course of business amounted to CHF 508 million (2009: 335).

39 Monetary net current assets by currency Cash and Accounts Trade Current Other Total Total marketable receivable accounts financial current 2010 2009 securities payable liabilities liabilities Million CHF EUR 640 540 453 999 343 (615) (1,323) GBP 323 226 333 24 137 55 (110) CHF 472 128 92 340 193 (25) 729 USD 474 311 279 466 295 (255) 237 CAD 17 176 136 3 94 (40) (51) MXN 42 117 109 35 40 (25) (152) INR 975 120 210 78 768 39 69 THB 30 37 36 16 25 (10) (70) IDR 101 54 46 34 35 40 4 PHP 55 31 23 13 22 28 11 AUD 25 338 170 97 196 (100) (537) Others 262 512 416 363 295 (300) (179) Total 3,416 2,590 2,303 2,468 2,443 (1,208) (1,372)

186 187

263.indd 187 07.04.2011 14:33:19 263.indd 188 Financial Information oa ahfo sdi netn ciiis(+)(,6)(4,430) (1,362) 98 262 736 61 (2,125) 230 Total cashflowusedininvestingactivities(A+B) Total purchaseoffinancialassets,intangible,otherassetsandbusinessesnet(B) Total disposaloffinancialassets,intangibleandotherassets Decrease inotherassets 162 Decrease infinancialinvestmentsincludingassociates Disposal offinancialassets,intangibleandotherassets 0 Cash andcashequivalentsofreclassifiedGroupcompanies Disposal ofparticipationinGroupcompanies(netcashandequivalentsdisposedof) Disposal ofparticipationinGroupcompanies 3 2 1 Proceeds fromsaleofproperty,plantandequipment Replacements Purchase ofproperty,plantandequipmentnet Million CHF activities ininvesting used flow Cash 40 Increase infinancialinvestmentsincludingassociates Purchase offinancialassets,intangibleandotherassets Total disposalofparticipationinGroupcompanies Acquisition ofparticipationinGroupcompanies(netcashandequivalentsacquired) Total purchaseofproperty,plantandequipmentnet(A) Expansion investments productive capacityandtosecurecompetitiveness Capital expendituresonproperty,plantandequipmenttomaintain Total purchaseoffinancialassets,intangibleandotherassets Increase inotherassets Refer totheconsolidatedstatementofcash ﬂows, footnote1. This positionrelatestoUnitedCement CompanyofNigeriaLtd(note1),reclassiﬁed asassociatein2009. Including goodwillofnewGroupcompanies. 2 3 1 152 (2,305) (1,592) 112 (1,929) (1,182) 40 (376) (410) 46 (744) (446) 69 (578) (639) 14 (679) (194) (252) 2010 6)(1,782) (60) 7 164 675 229 0 0 2009 07.04.2011 14:33:19 (65) (23) 139 202 Cash flow from acquisitions and disposals of Group companies Acquisitions Disposals Million CHF 2010 2009 2010 2009 Current assets (28) (753) 0 148 Consolidated Statements Financial Property, plant and equipment (23) (2,089) 0 0 Other assets (13) (266) 0 0 Current liabilities 11 586 0 (53) Long-term provisions 7 277 0 0 Other long-term liabilities 4 433 0 0 Net assets (42) (1,812) 0 95 Previously held net assets1 022100 Non-controlling interest 1 128 0 0 Net assets (acquired) disposed (41) (1,463) 0 95 Goodwill (acquired) disposed (28) (400) 0 3 Net gain on disposals2 00064 Total (purchase) disposal consideration (69) (1,863) 0 162 Acquired cash and cash equivalents 1 81 0 0 Payables and loan notes 8000 Net cash flow (60) (1,782) 0 162

41 Transactions and relations with members of the Board of Directors and senior management Key management compensation based compensation of CHF 0.8 million (2009: 0.9), and Board of Directors employer contributions to pension benefits of CHF 0.4 million In 2010, eleven non-executive members of the Board of Direc- (2009: 0.6). As a result, total compensation, before the addi- tors received a total remuneration of CHF 2.9 million (2009: 3.1) tional contributions for the financing of retirement benefits, in the form of short-term employee benefits of CHF 1.8 million amounted to CHF 3.7 million (2009: 4). Including the additional (2009: 1.9), post-employment benefits of CHF 0.1 million (2009: contributions from the Holcim International Pension Trust in 0.1), share-based payments of CHF 0.9 million (2009: 0.9) and the amount of CHF 5 million, based on actuarial considerations other compensation of CHF 0.1 million (2009: 0.2). and disclosed under “Others”, the CEO’s total compensation, in accordance with the rules of SIX Swiss Exchange, amounted to Senior management CHF 8.7 million (2009: 4). In accordance with Art. 663bbis of the The total annual compensation for the 15 members of senior Swiss Code of Obligations (transparency law), the base salary management (including CEO) amounted to CHF 36.7 million and the variable cash compensation are disclosed, including (2009: 27.2). This amount comprises of base salary and variable foreign withholding tax. Further included in the contribution cash compensation of CHF 18.2 million (2009: 16.7), share-based to pension plans are the employer’s contri butions to social compensations of CHF 4.4 million (2009: 4.9), employer contri- security (AHV/IV). butions to pension plans of CHF 5.3 million (2009: 4.8) and “Others” compensation of CHF 8.8 million (2009: 0.8) which The following table provides details on the total compensation includes, according to the rules of SIX Swiss Exchange, the con- awarded to the individual members of the Board of Directors, tributions from the Holcim International Pension Trust for the the highest compensation paid to a senior management mem- additional financing of retirement benefits in the amount ber and the total amount of senior management compensation. of CHF 8.3 million. The CEO received a base salary plus variable compensation in cash of CHF 2.5 million (2009: 2.5), share

1 Relates to previously held interest of 50 percent in Cement Australia. 2 In 2009 including transaction costs.

188 189

263.indd 189 07.04.2011 14:33:19 263.indd 190 Financial Information Markus Akermann (non-executive members) Total seniormanagement in percentageofbasesalary Variable compensation Erich Hunziker Beat Hess MemberoftheBoardDirectorsuntilMay7,2009 Lord NormanFowler Total BoardofDirectors 8 7 6 5 4 3 2 1 Name Compensation BoardofDirectors/seniormanagement hitn isagrMemberoftheBoardDirectors DeputyChairman,MemberoftheAuditCommittee Christine Binswanger Andreas vonPlanta Rolf Soiron oetF per ebro h or fDrcosNme 1,166 1,166 Number 1,166 Number Number MemberoftheBoardDirectors MemberoftheBoardDirectors, Robert F.Spoerry MemberoftheBoardDirectors, Dieter Spälti Wolfgang Schürer in percentageofbasesalary Variable compensation hmsShihiyMember oftheBoardDirectors,Member Thomas Schmidheiny H. OnnoRuding Adrian Loader Peter Küpfer Including executivemember oftheBoardDirectors,CEO. Excluding thiscontribution,thetotal compensation for2010wouldhaveamountedtoCHF3.7million. Includes theexpenseofemployer’s trustfortheadditionalfinancing ofthepensionbenefi ts, according totherulesofSIXSwissExchange. Member ofseniormanagementreceiving thehighestcompensation. Including director’sfeesfromsubsidiary companies. of CHF8.3million,whichdonotaffect thestatementofincomeGroup. In linewiththerulesofSIXSwissExchange, theseamountsincludeprimarilythecontributionsfromHolcimInternational Pension Trustinthe amount Value oftheoptionsaccordingtoBlack Scholesmodelatthetimeofallocation. period. restriction The shareswerevaluedattheaveragemarketpriceinperiodfromJanuary 1,2011,toFebruary15,andaresubject afive-year saleandpledge allocated intheyearunderreviewaredisclosedonpage184“Share compensation plan”. as wellalumpsumallowance,long-servicebenefits, governmentchildpayments,etc.Theparameters forthefairvaluecalculationofsharesandoptions “Other compensation”includesemployercontributionstopensionplans(state oldageandsurvivorsinsurance[AHV]/disability [IV],pensionfunds) Compensation fortheBoardofDirectorsandseniormanagementisdisclosed grossofwithholdingtaxandemployeesocialsecurity contributions. 6 8 Member oftheBoardDirectors, Member oftheBoardDirectorssinceMay6,2010 CEO Executive memberoftheBoardDirectors, Position Governance, Nomination&CompensationCommittee Chairman, Chairmanofthe Governance, Nomination&CompensationCommittee Member oftheAuditCommitteeuntilMay6,2010 ebro h ui omte ic a ,21 H 75080,000 97,500 80,000 100,000 CHF CHF Member oftheAuditCommitteesinceMay6,2010 Governance Nomination&CompensationCommittee Governance, Nomination&CompensationCommittee Member oftheBoardDirectors, Member oftheBoardDirectors Chairman oftheAuditCommittee Member oftheBoardDirectors, 1 CHF CHF Number CHF Number Number CHF CHF Number CHF Number Number Number CHF CHF Number Number CHF CHF Number CHF Number Number CHF CHF Number CHF 15,613,946 ,9,4 846,667 1,790,647 2,124,500 130,800 9,8 80,000 595,680 0,0 80,000 100,000 8,0 80,000 180,000 0,0 80,000 300,000 Cash Base Salary 66746,667 46,667 00080,000 80,000 00080,000 80,000 00080,000 80,000 12,340 5 Shares 80,000 1,166 1,166 1,166 1,166 1,166 1,166 1,166 07.04.2011 14:33:19 680

2 Variable Compensation Other compensation Total Total Cash Shares2 Options3 Employer Others4 compensation compensation contributions 2010 2009 Consolidated Statements Financial to pension plans

32,394 50,023 758,097 759,028

18,170 10,023 408,193 408,169

7,060 10,023 177,083 175,801

70,834

2,357 5,833 101,524

8,070 10,023 198,093 198,069

11,262 10,023 281,285 281,331

0 10,023 170,023 170,000

207,726

9,625 10,023 230,448 225,801

8,070 10,023 198,093 198,069

7,944 10,023 195,467 177,059

7,060 10,023 177,083 175,801

112,012 146,063 2,895,389 3,047,688 4,567 28,180 390,515 313,479 467,506 379,676 5,038,320 8,713,9967 3,993,318

55.1% 28,848 145,063 2,614,863 1,980,127 2,406,611 5,260,900 8,786,016 36,662,463 27,221,571

44.8%

190 191

263.indd 191 07.04.2011 14:33:19 263.indd 192 Financial Information and membersofseniormanagement. the Boardno loansoutstanding ofDirectorsto membersof December31,As at 2010, andDecember31, 2009,there were Loans 0.5 ofCHF the amount million(2009: 0). of one former inthe seniormanagement benefit memberof the employer’sthe pension forthe additionalfinancingof trust the rulesofSIXSwissaccordingto Exchange, the expense of former membersofseniormanagement. includes,This amount the Board ofDirectors (2009:two)three and (2009: four) 2.9million(2009: 1.3)wasto oneformerCHF paid memberof the yearIn underreview, compensation ofthe amount in Compensation for former of governing members bodies 07.04.2011 14:33:19 Shares and options owned by members of the Board of Directors and senior management The tables show the number of shares and options held ment as of December 31, 2010, and December 31, 2009, respec-

by members of the Board of Directors and senior manage- tively. Consolidated Statements Financial

Board of Directors1 Name Position Total number Total number of shares 2010 of call options 2010 Rolf Soiron Chairman, Governance, Nomination & Compensation Committee Chairman 35,713 Andreas von Planta Deputy Chairman 9,508 Christine Binswanger Member 2,760 Beat Hess Member 200 Erich Hunziker Member 9,750 Peter Küpfer Member, 37,0002 Audit Committee Chairman 9,749 31,0003 Adrian Loader Member 5,514 Thomas Schmidheiny Member 59,568,933 Wolfgang Schürer Member 42,454 Dieter Spälti Member 21,404 Robert F. Spoerry Member 8,179 Total Board of Directors (non-executive members) 59,714,164 68,000

1 From allocation, shares are subject to a ﬁ ve-year sale and pledge restriction period. 2 Exercise price: CHF 70; Ratio 1:1; Style: American; Maturity: 19.8.2014. 3 Exercise price: CHF 80; Ratio 1:1; Style: American; Maturity: 12.11.2013.

Board of Directors Name Position Total number Total number of shares 2009 of call options 2009 Rolf Soiron Chairman, Governance, Nomination & Compensation Committee Chairman 34,667 Andreas von Planta Deputy Chairman 8,462 Christine Binswanger Member 1,714 Erich Hunziker Member 8,704 Peter Küpfer Member, 83,2882 Audit Committee Chairman 8,703 31,0003 Adrian Loader Member 5,468 H. Onno Ruding Member 4,595 Thomas Schmidheiny Member 59,567,887 Wolfgang Schürer Member 41,408 Dieter Spälti Member 20,017 Robert F. Spoerry Member 7,133 Total Board of Directors (non-executive members) 59,708,758 114,288

The total number of shares and call options comprise privately members of the Board of Directors did not receive any options acquired shares and call options, and shares allocated under from compensation and profit-sharing schemes. profit-sharing and compensation schemes. Non-executive

1 From allocation, shares are subject to a ﬁ ve-year sale and pledge restriction period. 2 Exercise price: CHF 110; Ratio 1.0411:1; Style: European; Maturity: 21.5.2010. 3 Exercise price: CHF 80; Ratio 1:1; Style: American; Maturity: 12.11.2013.

192 193

263.indd 193 07.04.2011 14:33:20 263.indd 194 Financial Information 1 Options are issuedsolelyonregistered shares ofHolcimLtd. the Group’sunder profit-sharing andcompensation schemes. vately acquired shares andcalloptions,those allocated and total numberofsharesThe andcall optionsincludebothpri- Name Senior management aksAemn ExecutiveMemberoftheBoardDirectors,CEO Urs Böhlen Markus Akermann Name Senior management CorporateFunctionalManager CorporateFunctionalManager Total seniormanagement Stefan Wolfensberger Jacques Bourgon Bernard Terver Aidan Lynam Andreas Leu Javier deBenito MemberoftheExecutiveCommittee,CFO Ian Thackwray Theophil H.Schlatter MemberoftheExecutiveCommittee Roland Köhler MemberoftheExecutiveCommittee Benoît-H. Koch Thomas Knöpfel Paul Hugentobler Patrick Dolberg tfnWlesegrCorporateFunctionalManager Total seniormanagement CorporateFunctionalManager Stefan Wolfensberger Roland Köhler Jacques Bourgon Andreas Leu Gérard Letellier Javier deBenito MemberoftheExecutive Committee,CFO Bill Bolsover MemberoftheExecutiveCommittee Theophil H.Schlatter MemberoftheExecutiveCommittee Benoît-H. Koch Thomas Knöpfel Paul Hugentobler Patrick Dolberg ExecutiveMemberoftheBoardDirectors,CEO Tom Clough Urs Böhlen Markus Akermann From allocation,sharesaresubjectto aﬁve-year andoptionstoathree-year andnine-yearsalerestrictionperiodrespectively. 1 Position Member oftheExecutiveCommittee Position Area Manager Area Manager Area Manager Area Manager Member oftheExecutiveCommittee Member oftheExecutiveCommittee,CEOHGRS Member oftheExecutiveCommittee Member oftheExecutiveCommittee Corporate FunctionalManager Area Manager Area Manager Area Manager Area ManagerandCorporateFunctional Member oftheExecutiveCommittee Member oftheExecutiveCommittee Member oftheExecutiveCommittee Member oftheExecutiveCommittee of shares2010 of shares2009 Total number Total number 379,034 369,475 10,156 17,095 59,627 89,429 15,943 73,511 15,256 56,836 10,505 70,720 18,132 31,493 34,284 25,448 13,052 28,239 83,847 23,254 7,411 1,226 6,590 7,714 1,589 9,455 4,777 6,802 7,092 5,386 7,202 6,438 of calloptions2010 of calloptions2009 Total number Total number 890,685 976,831 261,916 105,704 234,065 120,883 108,303 99,896 16,618 69,801 20,960 14,965 16,908 17,894 17,726 16,783 41,029 14,059 53,609 53,693 93,124 94,133 18,885 12,531 89,633 83,688 83,772 58,545 33,550 9,124 5,719 07.04.2011 14:33:20 0 Other transactions As part of the employee share purchase plan, Holcim manages employees’ shares. It sells and purchases Holcim Ltd shares to

and from employees and on the open market. As a result, the Consolidated Statements Financial company purchased Holcim Ltd shares of CHF 0.29 million (2009: 0.91) at stock market price from members of senior management.

No compensation was paid or loans granted to parties closely related to members of the governing bodies.

42 Events after the reporting period There were no significant events after the reporting period.

43 Authorization of the financial statements for issuance The consolidated financial statements were authorized for issuance by the Board of Directors of Holcim Ltd on February 25, 2011, and are subject to shareholder approval at the annual general meeting of shareholders scheduled for May 5, 2011.

194 195

263.indd 195 07.04.2011 14:33:20 263.indd 196 Financial Information Latin America North America Europe Region Group Holcim the of companies Principal Juan MinettiS.A. Holcim ElSalvadorS.A.deC.V. Cemento PolpaicoS.A. Holcim (Brasil)S.A. Holcim (Ecuador)S.A. Holcim (Colombia)S.A. Holcim (CostaRica)S.A. Holcim (Nicaragua)S.A. Holcim ApascoS.A.deC.V. Holcim (Canada)Inc. grgt nutisMngmn n. USA Aggregate IndustriesManagementInc. Holcim (US)Inc. “Garadagh” SementO.J.S.C. Alpha CementJ.S.C. Holcim (Romania)S.A. Holcim HungáriaZrt. Holcim (Slovensko)a.s. Holcim (Bulgaria)AD Holcim (Serbia)d.o.o. Holcim (Hrvatska)d.o.o. Holcim (Č Holcim GroupSupportLtd Holcim Gruppo(Italia)S.p.A. Holcim (Schweiz)AG Holcim (Deutschland)AG Holcim (Süddeutschland)GmbH Aggregate IndustriesLtd Holcim TradingS.A. Holcim (España)S.A. Holcim FranceBeneluxS.A.S. Company esko) a.s. Chile Argentina Brazil Ecuador Colombia Costa Rica Nicaragua El Salvador Mexico Canada USA Azerbaijan Russia Bulgaria Romania Serbia Croatia Hungary Slovakia CehRpbi CZK CzechRepublic Switzerland Italy Switzerland Germany Germany Uie igo GBP UnitedKingdom Spain Spain France Place L 7,675,262 CLP ARS 72,536,776 BRL 8,604,056 USD 100.0% COP CRC 5,843,086 NIO USD MXN CAD USD USD AZN RUB S 23000100.0% 2,300,000 BGN RON 3,176,805 CSD HRK HUF EUR CHF EUR CHF EUR EUR EUR EUR EUR in 000 Nominal sharecapital 7,0 100.0% 171,201 455,675 102,405 9,5 100.0% 194,058 8,9 100.0% 486,297 352,057 274,243 9,5 100.0% 192,253 345,787 19,469 78,178 94,000 700100.0% 67,000 110100.0% 71,100 31,813 24,893 960100.0% 19,600 47,064 42,325 ,9 100.0% 1,093 ,0 100.0% 1,000 ,5 100.0% 6,450 100.0% 0 100.0% 0 (voting right) Participation 91.6% 99.9% 79.6% 69.6% 99.8% 92.2% 80.0% 59.8% 99.7% 99.7% 54.3% 99.8% 98.0% 82.7% 99.9% 88.9% 07.04.2011 14:33:20

Region Company Place Nominal share capital Participation in 000 (voting right) Africa Middle East Holcim (Maroc) S.A. Morocco MAD 421,000 61.0% Consolidated Statements Financial Ciments de Guinée S.A. Guinea GNF 46,393,000 59.9% Société de Ciments et Matériaux Ivory Coast XOF 912,940 99.9% Holcim (Liban) S.A.L. Lebanon LBP 135,617,535 52.1% Holcim (Outre-Mer) S.A.S. La Réunion EUR 37,748 100.0% Aden Cement Enterprises Ltd. Republic of Yemen YER 106,392 100.0% Asia Pacific ACC Limited1 India INR 1,877,453 48.3% Ambuja Cements Ltd.1 India INR 3,059,718 45.5% Holcim (Lanka) Ltd Sri Lanka LKR 4,457,771 98.9% Holcim (Bangladesh) Ltd Bangladesh BDT 269,004,000 89.0% Siam City Cement (Public) Company Limited2 Thailand THB 2,375,000 36.8% Holcim (Malaysia) Sdn Bhd Malaysia MYR 10,450 100.0% Holcim (Singapore) Pte. Ltd Singapore SGD 44,322 90.8% PT Holcim Indonesia Tbk. Indonesia IDR 3,645,034,000 80.6% Holcim (Vietnam) Ltd Vietnam USD 189,400 65.0% Holcim Philippines Inc. Philippines PHP 6,452,099 85.7% Cement Australia Holdings Pty Ltd Australia AUD 370,740 75.0% Holcim (Australia) Holdings Pty Ltd Australia AUD 1,145,867 100.0% Holcim (New Zealand) Ltd New Zealand NZD 22,004 100.0%

Listed Group companies Region Company Domicile Place of listing Market capitalization Security at December 31, 2010 code number in local currency Europe Holcim (Deutschland) AG Hamburg Frankfurt EUR 527 million DE0005259006 Latin America Holcim (Costa Rica) S.A. San José San José CRC 161,154 million CRINC00A0010 Holcim (Ecuador) S.A. Guayaquil Quito, Guayaquil USD 1,055 million ECP516721068 Juan Minetti S.A. Buenos Aires Buenos Aires ARS 1,588 million ARP6806N1051 Cemento Polpaico S.A. Santiago Santiago CLP 134,668 million CLP2216J1070 Africa Middle East Holcim (Maroc) S.A. Rabat Casablanca MAD 11,173 million MA0000010332 Holcim (Liban) S.A.L. Beirut Beirut USD 332 million LB0000012833 Asia Pacific ACC Limited Mumbai Mumbai INR 201,939 million INE012A01025 Ambuja Cements Ltd. Mumbai Mumbai INR 219,076 million INE079A01024 Siam City Cement (Public) Company Limited Bangkok Bangkok THB 53,820 million TH0021010002 PT Holcim Indonesia Tbk. Jakarta Jakarta IDR 17,241,525 million ID1000072309 Holcim Philippines Inc. Manila Manila PHP 100,008 million PHY3232G1014

1 Control obtained because of the power to cast the majority of votes at meetings of the Board of Directors. 2 Joint venture, proportionate consolidation.

196 197

263.indd 197 07.04.2011 14:33:20 263.indd 198 Financial Information Holderfin B.V. Holcim USFinanceS.àr.l.&CieS.C.S. Holcim ReinsuranceLimited Holcim Participations(UK)Limited Holcim Participations(US)Inc. Holcim OverseasFinanceLtd. Holcim Investments(Spain)S.L. Holcim Investments(France)SAS Holcim (India)PrivateLimited Holcim GBFinanceLtd. Holcim Finance(Luxembourg)S.A. Holcim Finance(Canada)Inc. Holcim Finance(Belgium)S.A. Holcim Finance(Australia)PtyLtd Holcim EuropeanFinanceLtd. Holcim (Centroamérica)B.V. Holcim Capital(Thailand)Ltd. Holcim CapitalCorporationLtd. Holcim BeteiligungsGmbH(Deutschland) Holcim AuslandbeteiligungsGmbH(Deutschland) Asia Pacific Holcibel S.A. 1 Africa MiddleEast Latin America North America Region Principal associated companies Aggregate IndustriesHoldingsLimited Holcim Ltd Company companies holding and finance Principal Cemasco B.V. Due tosigniﬁ cant inﬂ uence. Lafarge CementEgyptS.A.E. sadrCmn netetC.(... Iran Nigeria Huaxin CementCo.Ltd. Espandar CementInvestmentCo.(P.J.S.) United CementCompanyofNigeriaLtd AfriSam (Pty)Ltd Cementos ProgresoS.A. Lattimore MaterialsCompany,L.P. Company 1 South Netherlands Luxembourg Bermuda ntdKndmGBP United Kingdom USA Bermuda Spain France India Bermuda Luxembourg Canada Belgium Australia Bermuda Netherlands Thailand Bermuda Germany Germany Belgium ntdKndmGBP United Kingdom Switzerland Place Netherlands China Egypt Guatemala USA or residence Country ofincorporation Africa EUR USD CHF USD CHF EUR N 1,1,6 100.0% 19,317,267 EUR INR GBP EUR CAD EUR AUD EUR USD THB USD EUR EUR EUR CHF in 000 Nominal sharecapital USD 9,0 100.0% 690,000 7,0 100.0% 976,000 0,0 100.0% 102,000 5,7 100.0% 654,173 0,8 100.0% 505,581 551100.0% 15,551 880100.0% 88,850 ,0 100.0% 1,900 ,5 100.0% 1,453 ,7 100.0% 3,772 ,0 100.0% 1,100 ,3 100.0% 2,630 ,5 100.0% 2,556 ,5 100.0% 3,855 ,3 100.0% 1,030 6100.0% 16 0100.0% 10 7100.0% 67 2100.0% 62 5100.0% 25 100.0% 0 100.0% 8 100.0% 0 (voting right) (voting right) Participation Participation 49.9% 49.0% 15.0% 39.9% 20.0% 35.9% 43.7% 07.04.2011 14:33:20

GB_10_S.199-218_e:GB_2010_engl. 8.4.2011 11:21 Uhr Seite 199

To the General Meeting of Holcim Ltd, Jona Zurich, February 25, 2011

Report of the statutory auditor on the consolidated financial statements

As statutory auditor, we have audited the consolidated financial statements of Holcim Ltd, which comprise the consolidated statement Consolidated Financial Statements of income, consolidated statement of comprehensive earnings, consolidated statement of financial position, statement of changes in consolidated equity, consolidated statement of cash flows and notes on pages 129 to 198 for the year ended December 31,2010.

Board of Directors’ responsibility The Board of Directors is responsible for the preparation of the consolidated financial statements in accordance with International Financial Reporting Standards (IFRS) and the requirements of Swiss law.This responsibility includes designing, implementing and maintaining an internal control system relevant to the preparation and fair presentation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.The Board of Directors is further responsible for selecting and applying appropriate accounting policies and making accounting estimates that are reasonable in the circumstances.

Auditor’s responsibility Our responsibility is to express an opinion on these consolidated financial statements based on our audit.We conducted our audit in accordance with Swiss law, Swiss Auditing Standards and International Standards on Auditing.Those standards require that we plan and perform the audit to obtain reasonable assurance whether the consolidated financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the consolidated financial statements.The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the consolidated financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers the internal control system relevant to the entity’s preparation and fair presentation of the consolidated financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control system. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of accounting estimates made as well as evaluating the overall presentation of the consolidated financial statements.We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion In our opinion, the consolidated financial statements for the year ended December 31, 2010, give a true and fair view of the financial position, the results of operations and the cash flows in accordance with the International Financial Reporting Standards (IFRS) and comply with Swiss law.

Report on other legal requirements We confirm that we meet the legal requirements on licensing according to the Auditor Oversight Act (AOA) and independence (Art. 728 Code of Obligations (CO) and Art. 11 AOA) and that there are no circumstances incompatible with our independence. In accordance with Art. 728a para. 1 item 3 CO and Swiss Auditing Standard 890, we confirm that an internal control system exists, which has been designed for the preparation of consolidated financial statements according to the instructions of the Board of Directors.We recommend that the consolidated financial statements submitted to you be approved.

Ernst & Young Ltd

ChristophCh i t h D Dolenskyl k Willy Hofstetter Licensed Audit Expert Licensed Audit Expert Auditor in charge 198 199 GB_10_S.199-218_e:GB_2010_engl. 8.4.2011 11:21 Uhr Seite 200 GB_10_S.199-218_e:GB_2010_engl. 8.4.2011 11:21 Uhr Seite 201

Principal companies of the Holcim Group Holcim France Benelux S.A.S., France Aggregate Industries Ltd, United Kingdom Chief Executive France: Gérard Letellier Chief Executive: Alain Bourguignon Chief Executive Belgium/Netherlands: Lukas Epple Personnel: 5,440

Personnel: 3,130 Aggregate Industries Scotland L Company Data Production capacity: 9.0 million t of cement Aggregate Supplies L Altkirch plant Ash Solutions L Dannes plant Bardon Aggregates Héming plant Bardon Asphalt L Lumbres plant Bardon Concrete L Obourg plant Bardon Contracting L Rochefort plant Borderstone L Dunkerque grinding plant Bradstone L Ebange grinding plant Charcon L Grand-Couronne grinding plant Express Asphalt L Haccourt grinding plant London Concrete L Shareholdings: Masterblock L Dijon Béton Soc L Moxon Traffic Management L Geocycle S.A. Paragon Materials L Holcim Betonproducten B.V. L Ronez L Holcim Bétons (Belgique) S.A. L Spade Oak L Holcim Bétons (France) S.A.S. L Yeoman Aggregates Holcim Granulats (Belgique) S.A. Yeoman Asphalt L Holcim Granulats (France) S.A.S. Yeoman Glensanda Holcim Grondstoffen B.V. L Shareholdings: Aggregate Industries UK Ltd. L Charcon Holdings Ltd L Holcim (España) S.A., Spain Dansk Natursten A/S Chief Executive: Vincent Lefebvre Halsvik Aggregates AS Personnel: 1,333 Lytag Holdings Ltd L Production capacity: 5.0 million t of cement Yeoman Baumineralien GmbH Carboneras plant Yeoman Poland sp Zoo Gádor plant Jerez plant Lorca plant Holcim (Deutschland) AG, Germany Yeles plant Chief Executive: Leo Mittelholzer Shareholdings: Personnel: 1,389 Holcim Aridos S.L. Production capacity: 3.3 million t of cement Holcim Hormigones S.A. L Höver plant Holcim Morteros S.A. L Lägerdorf plant Bremen grinding plant Shareholdings: Holcim Trading S.A., Spain Hannoversche Silo-Gesellschaft mbH L Chief Executive: Alfonso Gárate Holcim Beton und Zuschlagsstoffe Personnel: 88 (NRW) GmbH L Cement

Seaborne clinker and cement trading Hüttensand Salzgitter GmbH & Co. KG Aggregates and others L SBU Kieswerk Zeithain GmbH & Co. KG L Other construction Vereinigte Transportbetonwerke GmbH & Co. KG L materials and services

200 201 GB_10_S.199-218_e:GB_2010_engl. 8.4.201111:21UhrSeite202 Financial Information n services and materials te construction Other L Aggregates Cement aaeetservices Management Personnel: Switzerland Ltd, Support Group Holcim S.r.l. Calcestruzzi Holcim S.r.l. Aggregati Holcim Eurofuels Shareholdings: plant grinding Ravenna plant grinding Morano plant Ternate plant Merone capacity: Production Personnel: Manager: Country Manager: General Regional Italy S.p.A., (Italia) Gruppo Holcim Austria GmbH, (Vorarlberg) Holcim AG Beton und Kies Holcim SA BF+P Holcim Shareholdings: Austria plant, grinding Lorüns plant Untervaz plant Siggenthal plant Eclépens capacity: Production Personnel: Manager: Country Manager: General Regional Switzerland AG, (Schweiz) Holcim GmbH Beton und Kies Holcim Shareholding: plant Dotternhausen capacity: Production Personnel: Manager: Country Manager: General Regional Germany GmbH, (Süddeutschland) Holcim . ilo fcement of t million 1.1 . ilo fcement of t million 5.1 cement of t million 3.6 oeioSalvadore Domenico al Gervasoni Carlo Gervasoni Carlo al Gervasoni Carlo eoWillimann Reto aprWenger Kaspar 1,189 754 593 320 L L L L L ocmWe mH Austria GmbH, Wien Holcim Shareholding: operations concrete Ready-mix operations Aggregates plant Rohoˇzník capacity: Production Personnel: Executive: Chief Slovakia a.s., (Slovensko) Holcim s.r.o Skanska Transbeton s.r.o Klecany Lom Shareholdings: operations concrete Ready-mix operations Aggregates plant Prachovice capacity: Production Personnel: Executive: Chief ( Holcim ocmmnrliargt d.o.o. agregati mineralni NedeˇscinaHolcim d.o.o. agregati mineralni Holcim Shareholdings: operations concrete Ready-mix operations Aggregates Korom capacity: Production Personnel: Executive: Chief Croatia d.o.o., (Hrvatska) Holcim operations concrete Ready-mix operations Aggregates plant Lábatlan plant Hejöcsaba capacity: Production Personnel: Executive: Chief Hungary Zrt., Hungária Holcim aˇ n plant cno ek)as,CehRepublic Czech a.s., Cesko) ˇ Oˇ cura . ilo fcement of t million 1.0 . ilo fcement of t million 1.2 . ilo fcement of t million 2.2 . ilo fcement of t million 2.2 arc Stapfer Patrick ihr Skene Richard Alan ai Grassl Mario Siˇ ˇ sinacki 559 390 310 557 L L L L L GB_10_S.199-218_e:GB_2010_engl. 8.4.2011 11:21 Uhr Seite 203

Holcim (Serbia) d.o.o., Serbia “Garadagh” Sement O.J.S.C., Azerbaijan Chief Executive: Gustavo Navarro Chief Executive: Raoul Waldburger Personnel: 398 Personnel: 577

Production capacity: 1.3 million t of cement Production capacity: 2.0 million t of cement Company Data Novi Popovac plant Garadagh plant Ready-mix concrete operations L

Holcim (US) Inc., USA Holcim (Romania) S.A., Romania Chief Executive: Bernard Terver Chief Executive: Daniel Bach Personnel: 1,894 Personnel: 1,073 Production capacity: 19.9 million t of cement Production capacity: 6.1 million t of cement Ada plant Alesd plant Artesia plant Campulung plant Catskill plant Turda grinding plant Devil’s Slide plant Aggregates operations Hagerstown plant Ready-mix concrete operations L Holly Hill plant Shareholdings: Mason City plant AgroComp International SRL Midlothian plant Estagre SRL Portland plant Romest Betoane si Agregate SA Bacau Ste. Genevieve plant Theodore plant Trident plant Holcim (Bulgaria) AD, Bulgaria Birmingham grinding plant Chief Executive: Todor Kostov Camden grinding plant Personnel: 539 Chicago grinding plant Production capacity: 2.4 million t of cement Beli Izvor plant Pleven plant Aggregate Industries Management Inc., USA Aggregates operations Chief Executive: Bernard Terver Ready-mix concrete operations L Personnel: 2,134 Shareholdings: Mid Atlantic Region L Holcim Beton Plovdiv AD L Mid West Region L Holcim Karierni Materiali AD North East Region L Holcim Karierni Materiali Plovdiv AD Western Region L Holcim Karierni Materiali Rudinata AD

Holcim (Canada) Inc., Canada Alpha Cement J.S.C., Russia Chief Executive: Paul Ostrander Chief Executive: Horia Adrian Personnel: 2,640 Personnel: 1,754 Production capacity: 3.3 million t of cement Production capacity: 4.4 million t of cement Joliette plant Shurovo plant Mississauga plant Volsk plant Shareholdings: Demix group L Dufferin group L

202 203 GB_10_S.199-218_e:GB_2010_engl. 8.4.201111:21UhrSeite204 Financial Information n services and materials te construction Other L Aggregates Cement evco minae ecceSG S.A. SAG, Geocycle Ambientales Servicios S.A. Concreto de Productos S.A. Zarcas Aguas Hidroeléctrica Shareholdings: plant Cartago capacity: Production Personnel: Executive: Rica Chief Costa S.A., Rica) (Costa Holcim plant grinding Nagarote capacity: Production Personnel: Executive: Chief Nicaragua S.A., (Nicaragua) Holcim C.V. de S.A. Concretos Holcim C.V. de S.A. C.V. de Geocycle S.A. Centroamérica de Bolsas Shareholdings: plant Maya plant Ronco El capacity: Production Personnel: Salvador El Executive: C.V., Chief de S.A. Salvador El Holcim C.V. de S.A. Gravasa C.V. de S.A. Ecoltec C.V. de S.A. Apasco Concretos C.V. de S.A. Apasco Cementos Shareholdings: plant Tecomán plant Arizpe Ramos plant Orizaba plant Macuspana plant Hermosillo plant Apaxco plant Acapulco capacity: Production Personnel: Executive: Mexico Chief C.V., de S.A. Apasco Holcim iad .Cae Caparroso Chavez A. Ricardo 22mlinto cement of t million 12.2 . ilo fcement of t million 1.7 . ilo fcement of t million 1.5 . ilo fcement of t million 0.3 dad Kretschmer Eduardo egoEgloff Sergio Egloff Sergio 1,064 3,916 675 128 L L L L L eeaoaRcfet S.A. Rocafuerte Generadora S.A. Construmercado Shareholdings: operations concrete Ready-mix operations Aggregates plant grinding Latacunga plant Guayaquil capacity: Production Personnel: Executive: Chief Ecuador S.A., (Ecuador) Holcim Ltda Eco-procesamiento Shareholding: operations concrete Ready-mix operations Aggregates plant Nobsa capacity: Production Personnel: Executive: Chief Colombia S.A., (Colombia) Holcim ed-i oceeoperations concrete Ready-mix operations Aggregates plant grinding Vitória plant grinding Sorocaba plant Leopoldo Pedro plant Cantagalo plant Barroso capacity: Production Personnel: Executive: Chief Brazil S.A., (Brasil) Holcim iulAglRubalcava Angel Miguel . ilo fcement of t million 2.1 . ilo fcement of t million 3.5 . ilo fcement of t million 5.3 oof Montero Rodolfo ta Hübscher Otmar 1,022 1,054 2,137 L L L L L GB_10_S.199-218_e:GB_2010_engl. 8.4.2011 11:21 Uhr Seite 205

Juan Minetti S.A., Argentina Ciments de Guinée S.A., Guinea Chief Executive: José Cantillana Chief Executive: Mohamed Ali Bensaid Personnel: 1,487 Personnel: 135

Production capacity: 4.3 million t of cement Production capacity: 0.6 million t of cement Company Data Capdeville plant Conakry grinding plant Malagueño plant Puesto Viejo plant Yocsina plant Société de Ciments et Matériaux, Ivory Coast Campana grinding plant Chief Executive: Johan Pachler Aggregates operation Personnel: 217 Ready-mix concrete operations L Production capacity: 0.8 million t of cement Shareholding: Abidjan grinding plant Ecoblend S.A.

Holcim (Liban) S.A.L., Lebanon Cemento Polpaico S.A., Chile Chief Executive: Urs Spillmann Chief Executive: Louis Beauchemin Personnel: 440 Personnel: 1,215 Production capacity: 2.9 million t of cement Production capacity: 2.5 million t of cement Chekka plant Cerro Blanco plant Shareholdings: Coronel grinding plant Holcim Béton S.A.L. L Mejillones grinding plant Société Libanaise des Ciments Blancs Shareholdings: Bogaz Endustri ve Madencilik, Compañia Minera Polpaico Ltd. Northern Cyprus Pétreos S.A. L Planta Polpaico del Pacifico Ltd. Polpaico Inversiones Ltd. Holcim (Outre-Mer) S.A.S., La Réunion Chief Executive: Vincent Bouckaert Personnel: 553 Holcim (Maroc) S.A., Morocco Production capacity: 0.9 million t of cement Chief Executive: Dominique Drouet Ibity plant Personnel: 623 Le Port grinding plant Production capacity: 5.2 million t of cement Nouméa grinding plant Fès plant Shareholdings: Oujda plant Holcim Madagascar S.A. Settat plant Holcim (Mauritius) Ltd Nador grinding plant Holcim (Nouvelle Calédonie) S.A. Shareholdings: Holcim Précontraint S.A. L Ecoval Holcim (Réunion) S.A. Holcim AOZ SAS Group Ouest Concassage Holcim Bétons L Holcim Granulats Aden Cement Enterprises Ltd., Republic of Yemen Chief Executive: Jaafar Skalli Personnel: 76 Aden terminal

204 205 GB_10_S.199-218_e:GB_2010_engl. 8.4.201111:21UhrSeite206 Financial Information n services and materials te construction Other L Aggregates Cement ua rnigplant grinding Surat plant grinding Sankrail plant grinding Ropar plant grinding Roorkee plant grinding Nalagarh plant grinding Farakka plant grinding Dadri plant grinding Bhatinda plant Rabriyawas plant Maratha plants Darlaghat plants Bhatapara plants Ambujanagar capacity: Production Personnel: Executive: Chief India Ltd., Cements Ambuja Ltd. Concrete Cement Associated Shareholding: operations concrete Ready-mix plant grinding Tikaria plant grinding Sindri plant grinding Kolar plant grinding Damodhar plant grinding Bellary plants Wadi plant Madukkarai plant Lakheri plant Kymore plant Jamul plants Gagal plant Chanda plant Chaibasa plant Bargarh capacity: Production Personnel: Executive: Chief India Limited, ACC 58mlinto cement of t million 25.8 cement of t million 28.2 nevndrWeijde der van Onne udpK Kaura K. Kuldip 14,969 8,283 L L rdcincapacity: Production Personnel: Thailand Executive: Limited, Chief Company (Public) Cement City Siam Limited Industries Cement United Ltd Industries Cement Saiham Shareholdings: plant grinding Mongla plant grinding Menghnaghat capacity: Production Personnel: Executive: Chief Bangladesh Ltd, (Bangladesh) Holcim plant grinding Ruhunu plant Palavi capacity: Production Personnel: Executive: Chief Lanka Sri Ltd, (Lanka) Holcim cws aeilPeLtd. Pte Material Ecowise Shareholding: operations concrete Ready-mix Personnel: Manager: General Singapore Ltd, Pte. (Singapore) Holcim Bhd Sdn Malaysia Geocycle Shareholding: operations concrete Ready-mix plant grinding Gudang Pasir capacity: Production Personnel: Executive: Chief Malaysia Bhd, Sdn (Malaysia) Holcim Ltd. Co. Concrete City Siam Ltd. Co. Conwood Shareholdings: plants Saraburi aaaaRalapanawa Mahanama 65mlinto cement of t million 16.5 . ilo fcement of t million 1.5 . ilo fcement of t million 1.2 . ilo fcement of t million 1.3 ans Kapur Rajnish tfnHuber Stefan hlpeArto Philippe ui Ghosh Sujit 3,172 220 603 630 209 L L L L L GB_10_S.199-218_e:GB_2010_engl. 8.4.2011 11:21 Uhr Seite 207

PT Holcim Indonesia Tbk., Indonesia Cement Australia Holdings Pty Ltd and Chief Executive: Eamon Ginley Cement Australia Partnership, Australia Personnel: 2,581 Chief Executive: Chris Leon

Production capacity: 8.2 million t of cement Personnel: 1,345 Company Data Cilacap plant Production capacity: 4.3 million t of cement Narogong plant Gladstone plant Ciwandan grinding plant Kandos plant Shareholdings: Railton plant Holcim (Malaysia) Sdn Bhd L Rockhampton plant PT Holcim Beton L Bulwer Island grinding plant PT Wahana Transtama Shareholdings: Australian Steel Mill Services Pty L Cement Australia Packaged Products Pty Ltd. Holcim (Vietnam) Ltd, Vietnam Ecocem Pty Ltd. L Chief Executive: Gary Schütz Pozzolanic Industries Pty Ltd. L Personnel: 1,703 The Cornwall Coal Mining Company Pty Ltd. L Production capacity: 5.1 million t of cement Hon Chong plant Cat Lai grinding plant Holcim (Australia) Holdings Pty Ltd, Australia Hiep Phuoc grinding plant Chief Executive: Mark Campbell Thi Vai grinding plant Personnel: 3,337 Ready-mix concrete operations L Aggregates operations Ready-mix concrete operations L Concrete products operations L Holcim Philippines Inc., Philippines Shareholdings: Chief Executive: Roland van Wijnen Broadway & Frame Premix Concrete Pty Ltd L Personnel: 1,767 Excel Concrete Pty Ltd L Production capacity: 9.2 million t of cement Bulacan plant Davao plant Holcim (New Zealand) Ltd, New Zealand La Union plant Chief Executive: Jeremy Smith Lugait plant Personnel: 756 Mabini grinding plant Production capacity: 0.6 million t of cement Ready-mix concrete operations L Westport plant Shareholding: Christchurch grinding plant Trans Asia Power Corporation Aggregates operations Ready-mix concrete operations L Shareholdings: AML Ltd L McDonald’s Lime Ltd L Millbrook Quarries Ltd

206 207 GB_10_S.199-218_e:GB_2010_engl. 8.4.201111:21UhrSeite208 Financial Information e income Net expenses Total Taxes expenses ordinary Other expenses Financial income Total income ordinary Other income Financial CHF Million Ltd Holcim income of Statement 117 (154.9) (151.7) 120 (96.5) (102.0) 4.)(54.8) (43.1) 8. 911.4 784.0 3. 756.5 632.3 5. 834.6 751.3 002009 2010 (6.6) 32.7 (3.6) 76.8 GB_10_S.199-218_e:GB_2010_engl. 8.4.2011 11:21 Uhr Seite 209

Balance sheet Holcim Ltd as at December 31 Million CHF 2010 2009 Cash and cash equivalents 355.6 610.5 Accounts receivable – Group companies 4.1 48.9

Prepaid expenses and other current assets 4.7 7.9 Holding Company Results Total current assets 364.4 667.3

Loans – Group companies 1,745.4 1,745.6 Financial investments – Group companies 17,693.7 16,880.8 Other financial investments 67.6 50.8 Total long-term assets 19,506.7 18,677.2

Total assets 19,871.1 19,344.5

Current financing liabilities – Group companies 184.7 165.9 Other current liabilities 33.5 31.5 Total current liabilities 218.2 197.4

Long-term financing liabilities – Group companies 32.4 154.0 Outstanding bonds 3,075.0 2,600.0 Total long-term liabilities 3,107.4 2,754.0

Total liabilities 3,325.6 2,951.4

Share capital 654.2 654.2

Legal reserves – Ordinary reserve1 9,375.6 9,396.9 – Reserve for treasury shares 476.1 454.8

Free reserve 4,962.8 4,962.8

Retained earnings 1,076.8 924.4 Total shareholders’ equity 16,545.5 16,393.1

Total liabilities and shareholders’ equity 19,871.1 19,344.5

1 The statutory capital contributions, which have been provided by the shareholders after December 31, 1996, amounted to CHF 7.5 billion as of December 31, 2010. This amount is calculated by applying Art. 5 para.1bis of the Swiss withholding tax law and circular letter No 29 dated December 9, 2010, issued by the federal tax administration.

208 209 GB_10_S.199-218_e:GB_2010_engl. 8.4.201111:21UhrSeite210 Financial Information eebr3,2009 31, December year the of income Net reserve free to Allocation dividend Stock shares treasury for reserve Increase increase Capital 2009 1, January 2010 31, December year the of income Net reserve free to Allocation Payout shares treasury for reserve Increase increase Capital 2010 1, January CHF Million Ltd Holcim equity shareholders’ in Change aia eev rauyrsreearnings reserve treasury reserve capital 5. ,9. 5. ,6. 2. 16,393.1 924.4 4,962.8 454.8 16,545.5 9,396.9 1,076.8 654.2 4,962.8 476.1 9,375.6 654.2 5. ,9. 5. ,6. 2. 16,393.1 924.4 4,962.8 454.8 9,396.9 654.2 2. ,5. 0. ,6. 6. 13,611.0 761.9 4,962.8 400.6 6,958.5 527.2 2. 2,492.6 127.0 hr riayRsrefor Reserve Ordinary Share (54.2) (21.3) shares 54.2 21.3 reRtie Total Retained Free 499 (479.9) (479.9) 540 (594.0) (594.0) 5. 756.5 756.5 3. 632.3 632.3 2,619.6 0 0 0 0 0 GB_10_S.199-218_e:GB_2010_engl. 8.4.2011 11:21 Uhr Seite 211

Data as required under Art. 663b and c of the Swiss Code of Obligations Contingent liabilities 31.12.2010 31.12.2009 Million CHF Holcim Capital Corporation Ltd. Guarantees in respect of holders of Holding Company Results 7.05% USD 358 million private placement due in 2011 3641 420 6.59% USD 165 million private placement due in 2014 1881 205 7.65% USD 50 million private placement due in 2031 691 73 6.88% USD 250 million bonds due in 2039 2571 284 Holcim Capital (Thailand) Ltd. Guarantees in respect of holders of 6.48% THB 2,150 million bonds due in 2010 0 66 6.69% THB 2,450 million bonds due in 2012 762 75 3.52% THB 2,000 million bonds due in 2015 682 0 Holcim Finance (Australia) Pty Ltd Guarantees in respect of holders of 8.50% AUD 500 million bonds due in 2012 4773 463 Holcim Finance (Belgium) S.A. Commercial Paper Program, guarantee based on utilization, EUR 500 million maximum 255 0 Holcim Finance (Canada) Inc. Guarantees in respect of holders of 6.91% CAD 10 million private placement due in 2017 124 12 5.90% CAD 300 million bonds due in 2013 3094 324 Holcim Finance (Luxembourg) S.A. Guarantees in respect of holders of 4.38% EUR 750 million bonds due in 2010 0 1,227 4.38% EUR 600 million bonds due in 2014 8245 981 9.00% EUR 650 million bonds due in 2014 8935 1,063 6.35% EUR 200 million private placement due in 2017 2755 327 Holcim GB Finance Ltd. Guarantees in respect of holders of 8.75% GBP 300 million bonds due in 2017 4786 549 Holcim Overseas Finance Ltd. Guarantees in respect of holders of 2.75% CHF 300 million notes due in 2011 330 330 3.00% CHF 250 million notes due in 2013 275 275 Holcim US Finance S.à r.l. & Cie S.C.S. Guarantees in respect of holders of 5.96% USD 125 million private placement due in 2013 1171 129 6.10% USD 125 million private placement due in 2016 1171 129 6.21% USD 200 million private placement due in 2018 1871 206 5.12% EUR 90 million private placement due in 2013 1245 147 2.10% EUR 358 million private placement due in 2013 4925 586 2.25% EUR 202 million private placement due in 2015 2785 330 6.00% USD 750 million bonds due in 2019 7721 852

Guarantees for committed credit lines, utilization CHF 1,040 million (2009: 2,018) 5,658 5,896 Other guarantees 825 241

Holcim Ltd is part of a value added tax group and therefore jointly liable to the Swiss Federal Tax Administration for the value added tax liabilities of the other members.

1 Exchange rate USD: CHF 0.9363. 4 Exchange rate CAD: CHF 0.9365. 2 Exchange rate THB: CHF 0.0309. 5 Exchange rate EUR: CHF 1.2490. 3 Exchange rate AUD: CHF 0.9530. 6 Exchange rate GBP: CHF 1.4484. 210 211 GB_10_S.199-218_e:GB_2010_engl. 8.4.201111:21UhrSeite212 Financial Information aia ru opne n.hl 31146o percent 5 or 13,181,456 held Inc. Companies Group Capital ocmGop npgs16t 198. to 196 pages on Group” Holcim eitrdsae so uut1,2008. 15, August of as shares registered percent). 6.52 or 21,326,032 (2009: hrs(09 95787o 82 percent) 18.21 or 59,567,887 (2009: shares 1,004,973). n nietyhl 95893o 82 ecn registered percent 18.21 or 59,568,933 held indirectly and 174. and 173 pages on listed are 2010, 31, ber hrsan shares the of companies “Principal heading the under listed are 01.01.09 01.01.10 odn Ghl 13602o .2pretrgsee shares registered percent 6.52 or 21,326,032 held AG Holding 2 1 directly Schmidheiny Thomas 2010, 31, December of As shareholders Important of Board the of members the 2010, management 31, senior December and of Directors As of Board of interests Share 31.12.10 31.12.10 to 01.01. 31.12.09 31.12.09 to 01.01. capital share Conditional 31.12.10 31.12.10 to 01.01. 31.12.10 to 01.01. 01.01.10 31.12.09 31.12.09 to 01.01. 31.12.09 to 01.01. 01.01.09 shares Treasury Ltd Holcim of investments indirect and direct principal The investments Principal Decem- of as placements private and bonds outstanding The bonds Issued 20:6,7,3)adn ihst cur ute registered further acquire to rights no and 60,078,233) (2009: n nietyi h grgt 00318rgsee shares registered 60,093,198 aggregate directly the in held Holcim indirectly of and management senior and Directors nlddi hr neet fBado ietr n eirmanagement. senior and Directors of Board of interests share in percent. 3 Included than more of Shareholding 0481cl pin nrgsee hrs(2009: shares registered on options call 044,831 1, d 1 odtoa hrsprvalue par shares Conditional odtoa hrsprvalue par shares Conditional odtoa hrsprvalue par shares Conditional Movement value par shares Conditional Movement shares Treasury Sales Purchases shares Treasury shares Treasury Sales Purchases shares Treasury 2 n Eurocement and , h infor The a)o h ws oeo biain r icoe nthe in disclosed are Obligations of Code Swiss the of law) seset,At 663b Art. assessment), 198. to 151 pages on to statements notes the financial in found consolidated be the can information Further ments. eto Rs aaeet npgs14t 5 n oe41 respectively. note 195, and to 150 189 to 144 pages on pages on management” “Risk section pcfcifraini codnewt r.63 aa 2(risk 12 para. 663b Art. with accordance in information Specific 2,075,762 5,132,061 6,905,384 6,905,384 1,422,350 1,422,350 1,422,350 1,422,350 7,131,083 (206,601) (302,439) ubrPieprsaei CHF in share per Price Number ubrPieprsaei CHF in share per Price Number 432,300 000 000 aindslsdcmle ihSislglrequire- legal Swiss with complies disclosed mation bis n r.63 aa (transparency 3 para. 663c Art. and 66.76 46.90 65.86 65.86 73.26 77.52 37.29 78.05 2.00 2.00 2.00 2.00 ilo CHF Million ilo CHF Million (12.2) (23.2) 476.1 400.6 454.8 454.8 77.4 33.5 2.8 2.8 2.8 2.8 GB_10_S.199-218_e:GB_2010_engl. 8.4.2011 11:21 Uhr Seite 213

Share capital 2010 2009 Shares Number MillionCHF Number MillionCHF Registered shares of CHF 2 par value 327,086,376 654.2 327,086,376 654.2

Total 327,086,376 654.2 327,086,376 654.2 Holding Company Results

Appropriation of retained earnings 2010 2009 Million CHF Million CHF Retained earnings brought forward 444.5 167.9 Net income of the year 632.3 756.5 Transfer from ordinary reserves (capital contribution reserves) 479.9 0 Retained earnings available for annual general meeting of shareholders 1,556.7 924.4 The Board of Directors proposes to the annual general meeting of shareholders of May 5, 2011, in Dübendorf the following appropriation:

Gross payout (out of capital contribution reserves)1 (479.9) 0 Gross payout (out of retained earnings) 0 (479.9)

Total payout (479.9) (479.9) Appropriation to free reserves (600.0) 0 Balance to be carried forward 476.8 444.5

2010 2009 Cash payout CHF Cash payout CHF Payout/dividend per share, gross 1.50 1.50 Less withholding tax 0 (0.53) Payout/dividend per share, net 1.50 0.97

1 There is no payout on treasury shares held by Holcim. On January 1, 2011, treasury holdings amounted to 7,131,083 registered shares. 212 213 GB_10_S.199-218_e:GB_2010_engl. 8.4.2011 11:21 Uhr Seite 214 GB_10_S.199-218_e:GB_2010_engl. 8.4.2011 11:21 Uhr Seite 215

To the General Meeting of Holcim Ltd, Jona Zurich, February 25, 2011

Report of the statutory auditor on the financial statements

As statutory auditor, we have audited the accompanying financial statements of Holcim Ltd, which comprise the statement of Holding Company Results income, balance sheet, change in shareholders’equity and notes presented on pages 208 to 213 for the year ended December 31,2010.

Board of Directors’ responsibility The Board of Directors is responsible for the preparation of the financial statements in accordance with the requirements of Swiss law and the company’s articles of incorporation.This responsibility includes designing, implementing and maintaining an internal control system relevant to the preparation of financial statements that are free from material misstatement, whether due to fraud or error.The Board of Directors is further responsible for selecting and applying appropriate accounting policies and making accounting estimates that are reasonable in the circumstances.

Auditor’s responsibility Our responsibility is to express an opinion on these financial statements based on our audit.We conducted our audit in accordance with Swiss law and Swiss Auditing Standards.Those standards require that we plan and perform the audit to obtain reasonable assurance whether the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements.The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers the internal control system relevant to the entity’s preparation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control system. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of accounting estimates made as well as evaluating the overall presentation of the financial statements.We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion In our opinion, the financial statements for the year ended December 31, 2010, comply with Swiss law and the company’s articles of incorporation.

Report on other legal requirements We confirm that we meet the legal requirements on licensing according to the Auditor Oversight Act (AOA) and independence (Art. 728 Code of Obligations (CO) and Art. 11 AOA) and that there are no circumstances incompatible with our independence. In accordance with Art. 728a para. 1 item 3 CO and Swiss Auditing Standard 890, we confirm that an internal control system exists, which has been designed for the preparation of financial statements according to the instructions of the Board of Directors. We further confirm that the proposed appropriation of available retained earnings complies with Swiss law and the company’s articles of incorporation.We recommend that the financial statements submitted to you be approved.

Ernst & Young Ltd

Christoph Dolensky Willy Hofstetter Licensed Audit Expert Licensed Audit Expert Auditor in charge 214 215 GB_10_S.199-218_e:GB_2010_engl. 8.4.2011 11:21 Uhr Seite 216 GB_10_S.199-218_e:GB_2010_engl. 8.4.2011 11:21 Uhr Seite 217

5-year-review Group Holcim 2010 2009 2008 2007 2006 Statement of income Net sales Million CHF 21,653 21,132 25,157 27,052 23,969 -Year-Review

Gross profit Million CHF 9,274 9,060 11,041 12,979 11,353 5 Operating EBITDA Million CHF 4,513 4,630 5,333 6,930 6,086 Operating EBITDA margin % 20.8 21.9 21.2 25.6 25.4 EBITDA Million CHF 4,988 5,229 5,708 8,468 6,333 Operating profit Million CHF 2,619 2,781 3,360 5,024 4,385 Operating profit margin % 12.1 13.2 13.4 18.6 18.3 Depreciation, amortization and impairment Million CHF 1,934 1,858 1,985 1,919 1,723 EBIT Million CHF 3,054 3,371 3,723 6,549 4,610 Income taxes Million CHF 615 623 663 1,201 1,078 Tax rate % 28 24 23 21 28 Net income Million CHF 1,621 1,958 2,226 4,545 2,719 Net income margin % 7.5 9.3 8.8 16.8 11.3 Net income – shareholders of Holcim Ltd Million CHF 1,182 1,471 1,782 3,865 2,104 Statement of cash flows Cash flow from operating activities Million CHF 3,659 3,888 3,703 5,323 4,423 Cash flow margin % 16.9 18.4 14.7 19.7 18.5 Investments in property, plant and equipment for maintenance Million CHF 410 376 1,104 1,043 1,062 Investments in property, plant and equipment for expansion Million CHF 1,182 1,929 3,287 2,245 1,265 (Disposal) Acquisition of participation in Group companies, (di)investments financial, intangible and other assets net1 Million CHF (230) 2,125 747 (50) 1,460 Statement of financial position Current assets Million CHF 8,512 10,797 9,994 10,372 9,747 Long-term assets Million CHF 35,747 38,409 35,199 37,839 34,955 Total assets Million CHF 44,259 49,206 45,193 48,211 44,702 Current liabilities Million CHF 7,214 9,280 10,765 9,025 8,621 Long-term liabilities Million CHF 15,924 17,882 16,454 17,241 17,356 Total shareholders’ equity Million CHF 21,121 22,044 17,974 21,945 18,725 Shareholders’ equity as % of total assets 47.7 44.8 39.8 45.5 41.9 Non-controlling interest Million CHF 3,020 3,011 2,616 3,163 3,548 Net financial debt Million CHF 11,363 13,833 15,047 12,873 12,837 Capacity, sales and personnel Annual production capacity cement Million t 211.5 202.9 194.4 197.8 197.8 Sales of cement Million t 136.7 131.9 143.4 149.6 140.7 Sales of mineral components Million t 4.1 3.5 4.8 5.5 6.0 Sales of aggregates Million t 157.9 143.4 167.7 187.9 187.6 Sales of ready-mix concrete Million m3 45.9 41.8 48.5 45.2 44.2 Personnel 31.12. 80,310 81,498 86,713 89,364 88,783 Financial ratios Return on equity2 % 6.4 8.6 10.4 22.8 15.8 Gearing3 % 53.8 62.8 83.7 58.7 68.6 Funds from operations4/net financial debt % 31.3 27.6 28.0 50.2 34.6 EBITDA net interest coverage X 6.1 7.3 7.6 11.0 6.8 EBIT net interest coverage X 3.7 4.7 4.9 8.5 5.0

1 Refer to the consolidated statement of cash ﬂ ows, footnote 1. 2 Excludes non-controlling interest. 3 Net ﬁ nancial debt divided by total shareholders’ equity. 4 Net income plus depreciation, amortization and impairment. 216 216 217217 GB_10_S.199-218_e:GB_2010_engl. 8.4.2011 11:21 Uhr Seite 218

Cautionary statement regarding forward-looking statements This document may contain certain forward-looking statements relating to the Group’s future business, development and economic performance. Such statements may be subject to a number of risks, uncertainties and other important factors, such as but not limited to (1) competitive pressures; (2) legislative and regulatory developments; (3) global, macro- economic and political trends; (4) fluctuations in currency exchange rates and general financial market conditions; (5) delay or inability in obtaining approvals from authorities; (6) technical developments; (7) litigation; (8) adverse publicity and news coverage, which could cause actual development and results to differ materially from the statements made in this document. Holcim assumes no obligation to update or alter forward-looking statements whether as a result of new information, future events or otherwise.

Holcim Ltd Zürcherstrasse 156 CH-8645 Jona/Switzerland Phone +41 58 858 86 00 [email protected] www.holcim.com

Financial reporting calendar Results for the first quarter of 2011 May 4, 2011 General meeting of shareholders May 5, 2011 Ex date May 9, 2011 Payout May 12, 2011 Half-year results for 2011 August 18, 2011 Press and analyst conference for the third quarter of 2011 November 9, 2011 Press and analyst conference on annual results for 2011 February 29, 2012

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