AFRICA: MOROCCO: Lafarge H2 profit drops as revenue falls

Company sees demand recovery in 2011

Feb 22 (Reuters) - Lafarge Ciments (LAC.CS), the Moroccan affiliate of French cement maker Lafarge, posted a 17.6 percent drop in second-half profit after underperforming rivals in sales amid a slowdown in demand it expects to overcome this year.

The company reported a net profit of 726 million dirhams ($88.5 million) for the six months through December, down from 881 million dirhams a year earlier, based on Reuters calculations.

For all of 2010, it earned 1.68 billion dirhams, compared with 953 million dirhams during the first half of last year and 1.86 billion dirhams for all of 2009.

The company did not give performance indicators for the second half of 2010 alone.

Lafarge Ciments will give shareholders a 66 dirhams per share dividend for 2010. The stock ended 0.3 percent lower at 1,920 dirhams.

Revenue for 2010 fell 1.6 percent to 5.35 billion dirhams. After reporting a 1 percent drop in the first half's turnover to 2.79 billion dirhams, Lafarge Ciments' calculated revenue for the second half stands at 2.56 billion dirhams, or about 2 percent less than a year earlier.

"Our cement sales recorded a 4.7 percent decline in an almost-stable market (that added) 0.4 percent," said Lafarge Ciments, which blamed a drop in demand from its traditionally key market in the north of the country and the addition of rival capacity elsewhere.

Casablanca-based Lafarge Ciments is a listed subsidiary of Lafarge (LAFP.PA) and Moroccan partner SNI, in which the Moroccan royal family is a key shareholder.

The company and rivals such as Holcim Maroc HOL.CSi and Ciments du Maroc (SCM.CS) have grappled with a stagnant market since 2009, after years of growth fed by infrastructure upgrades, low-income housing projects and a tourism boom.

Lafarge Ciments expects this situation to change this year.

"The market behaviour indicates a relative recovery ... The continuing desire by the government to relaunch low-income housing, coupled with the start of some infrastructure projects ... lead us to expect a recovery in the growth of domestic demand in 2011," it said.