Vicat's H1 2026: Emerging Markets Power a Guidance Upgrade
Strong volume and price execution in Senegal, Egypt, and India offset Europe's softness, lifting EBITDA and prompting a full-year upgrade.
VCT.PA · Earnings Call · 2026-07-30
Vicat reported a robust first half of 2026, with organic sales up 10.8% and EBITDA up 13.6% like-for-like, prompting the company to raise its full-year growth guidance to 7%-9% for both metrics. The results highlight the company's geographic diversification and operational discipline, led by a powerful emerging-market engine.
Emerging Markets: The Growth Engine
The core of the performance was an acceleration in emerging countries, particularly Africa and the Asia/Mediterranean region. CFO Hugues Chomel noted, “Our emerging markets made the difference. Asia/Mediterranean added EUR 11 million of EBITDA on a like-for-like basis... Africa was clearly the major driver, contributing EUR 36 million as the ramp-up of Kiln 6 in Senegal delivered a strong improvement in our cost base.” — Hugues Chomel, Deputy CEO and CFO · 2026-07-30 This marks a clear shift from prior years when European operations were the primary profit contributor. The emerging markets now account for the bulk of incremental EBITDA. Senegal stands out as a company-unique catalyst: the new Kiln 6 has transformed the cost structure. Cement EBITDA in Senegal jumped EUR 23 million year-over-year to EUR 32 million, driven by the kiln's ramp-up and domestic price increases. The new kiln allowed Vicat to fully substitute imported cement, shut down two older kilns, and improve energy efficiency—generating run-rate savings of around EUR 20 per ton once fully operational. This is a direct, tangible driver of the upgrade.Managing Cost Inflation
Energy costs remain a headwind, but Vicat's hedging strategy is mitigating the impact. Energy cost excluding transport rose 11.6% in H1, largely volume-driven; the CFO explained, “Excluding the volume effect, energy cost inflation remained contained, reflecting the effectiveness of our hedging policy.” — Hugues Chomel, Deputy CEO and CFO · 2026-07-30 However, the company expects the raw impact to become more visible in H2 as hedges roll off. To counter this, Vicat implemented price increases across Europe and emerging markets, absorbing EUR 140 million of additional costs. In the U.S., announced price hikes of $5 per ton in California and the Southeast are underway, while Brazil continues its strong momentum.Strategic Levers: Carbon Capture and AI
Beyond near-term execution, Vicat is positioning itself for long-term structural advantages. The July inauguration of Catch4Climate—a joint venture with three other cement producers—is a world first for second-generation oxy-fuel carbon capture, achieving CO2 concentration above 90%. As Chomel framed it,This directly supports the company's Carbon capture strategy and could become a significant differentiator as regulation tightens. Vicat also acquired Araïko, a French AI startup focusing on generative and agentic AI for industrial applications. The CFO emphasized, “We have big ambitions in AI, which we view as a powerful operational lever that can deliver meaningful gains.” — Hugues Chomel, Deputy CEO and CFO · 2026-07-30 This move signals a determination to build in-house AI capabilities, protecting proprietary data and algorithms that can enhance plant efficiency and product formulation.This project is a breakthrough innovation in the cement industry and a concrete illustration of how we intend to make decarbonization technically and economically viable at industrial scale.