Thank you. Can you hear me well? Good evening, ladies and gentlemen. Welcome to the Saint-Gobain Tower. I know it's a busy end of year, so the date is a bit unusual, but you may have more mental availability before the Christmas holidays to listen to the strategy. I'm delighted to exchange with you. I'll give you a fairly concise presentation on what Saint-Gobain is today, what we have done over the past few years, and above all, what the perspectives are for the coming years. Saint-Gobain is the world leader in sustainable construction. Before going into detail with figures, I'd like to illustrate some of our achievements. We are leaders in construction, notably in all the products related to the building envelope — roofing, ceilings, facades, windows, floors, partitions. We bring performance criteria in energy, acoustics, air quality, visual comfort, and construction site productivity. In short, Saint-Gobain's strategy is to provide everything necessary for a good building envelope, and by extension, infrastructure, with all these characteristics. We apply this on residential, non-residential, and infrastructure markets.
Here is an illustration on the renovation market — residential buildings in Germany with 13 Saint-Gobain solutions for energy efficiency and aesthetics in Düsseldorf. Another example in a different geography, also sustainable solutions for residential markets — a residence in Dubai with 18 solutions. You can see I'm already talking about solutions. Previously, Saint-Gobain sold products in isolation. Now, organized by country with country leaders who have the entire product range, they can assemble systems — a facade, a complete building envelope — for both new construction and renovation. Another illustration: residences in new construction in Dubai with 18 solutions. Now moving to the non-residential market — commercial or non-residential buildings like a hospital in the United States with eight different products, from ceilings to facades, glazing for interior comfort. And a university in Vietnam with several solutions. We've seen examples in residential renovation and new construction, and now in different geographies — the US, Asia, Vietnam — on non-residential markets. There's a third application area that may be less immediately associated with Saint-Gobain: infrastructure — tunnels, bridges. Saint-Gobain is today an important supplier of solutions for these applications, through construction chemistry — waterproofing solutions for tunnels, admixtures for special concrete on tunnels or bridges. Examples in Egypt and Mauritius. This is another universe of application of Saint-Gobain's material know-how in construction — not just residential buildings, not just new construction, but also renovation, non-residential markets, and infrastructure.
Today, Saint-Gobain is the world leader in sustainable construction with revenue slightly above €46 billion — closer to $55 billion. Revenue has stagnated somewhat recently due to significant currency effects, with the euro strengthening notably against the US dollar and other currencies. It is by far the largest actor in sustainable construction materials. We are number one in each of the major geographic zones that matter. We are number one in Europe — the group's origin. Number one in North America — a zone where we have invested heavily over the past 5 years, with over $7 billion in industrial investment and acquisitions. It's not always known that Saint-Gobain is the leading construction materials supplier in the United States and Canada. Number one in Australia — a recent move, our largest acquisition in 20 years: a public tender offer on an Australian-listed company, a leader in plasterboard and insulation. Australia is an interesting geography — OECD country with population growth from immigration, politically and economically stable, with a stable currency. So very strong positions in mature markets — Europe, North America, Australia — and very strong number-one positions in high-growth emerging countries: Latin America, where we've been nearly 90 years in Brazil; India, where we've been 40 years with number-one positions in all our business lines; and number one in the Middle East — Saudi Arabia, Egypt, Turkey. Saint-Gobain is truly a global leader, not just in France or Europe. This capacity to grow in both mature and high-growth countries is key. In Saudi Arabia and the UAE, we see growth of 30 to 35%. In India, we've doubled in size every 5 years for the past 15 years, with volume growth of over 10% per year. Saint-Gobain is present in 80 countries. Since our 350th anniversary 10 years ago, we've added 15 countries, going from 65 to 80, and 200 factories, going from 900 to 1,100 worldwide.
Sustainable construction sits at the crossroads of major contemporary trends and challenges. First, urbanization and population growth. In India, about 30% of the population lives in cities, with the rest being rural. It is almost certain that within 30 to 40 years, India will reach 50, 60, 70% urban population. This urbanization necessitates construction in addition to strong demographic growth. In Egypt, there is a project to build 27 new cities over the next 30 years, each exceeding 1 million inhabitants. Second, everywhere there is an aspiration from the middle classes for quality buildings — quality residential buildings, individual or collective. Third, with the deglobalization of the world, there are challenges of reshoring infrastructure and industrial tools, which also creates growth perspectives. Then, linked to climate: energy renovation. The construction world — from material extraction, building construction, building lifecycle, energy consumption, air conditioning — represents 35% of global CO2 emissions. It's not possible to control or reduce the strong growth in CO2 emissions without addressing building emissions, which represent roughly a third of global CO2 emissions. Energy renovation and energy efficiency in buildings are essential. Additionally, buildings and infrastructure must be adapted to the effects of climate change, which are occurring everywhere with increasing frequency and intensity — storms, hurricanes, fires, floods. We've seen the damage in Valencia, Spain, Canadian wildfires, tornadoes and hurricanes in the US, typhoons in Vietnam and Thailand. Buildings and infrastructure must become more resilient. The last important topic is the scarcity of natural resources. Construction uses roughly 40 to 50% of natural resources on the planet, not by value but by volume. Resources like sand are becoming increasingly scarce, so we must move to large-scale circular economy to recycle materials. Sustainable construction is driven by these major contemporary trends that will sustain the group's growth for several decades, because countries are committed to carbon neutrality at different dates — 2040, 2050 for some, China in 2060, India in 2070. There are decades of work ahead.
Facing these major sustainable construction challenges, Saint-Gobain is the only supplier with complete solutions for buildings and infrastructure. Exterior solutions — roofing, facade cladding, glazing. Interior solutions — plasterboard for partitions, insulation, ceiling tiles. Construction chemistry solutions — waterproofing, exterior insulation renders, adhesives, as more materials are bonded in buildings. Concrete admixtures to decarbonize concrete, additives to improve the environmental performance of cement. And worksite and distribution solutions, which you know well in France through brands like Point P and Cedeo, in contact with 400,000 to 500,000 artisans. They can propose and implement the best solutions for new construction, energy renovation of individual homes, or the French tertiary decree requiring 40% reduction in energy consumption for commercial spaces over 1,000 m² between 2020 and 2030. Saint-Gobain is truly the reference supplier and leader in complete solutions for buildings and infrastructure.
Perhaps a retrospective look at the plan we launched in 2021. Some of you have followed it over time. We launched a strategic and financial plan called Growth & Impact — measuring the positive impact of our solutions: energy well-being in a well-insulated house, acoustic well-being in a classroom, productivity on a construction site. The more positive impact we create, the more we grow, entering a virtuous circle. This Growth & Impact plan ran for 5 years, from 2021 to 2025. Beyond strategic achievements I'll come back to, we exceeded all financial targets we set in 2021. Revenue evolution — you mentioned it — operating margin went from the historical 7% to nearly 11%. Free cash flow conversion was strong. Free cash flow tripled. Net earnings per share doubled. Return on capital employed gained over 3.5 points between 2018 and 2024. This was a genuine step-change in group performance, enabling significant shareholder returns of €1.5 billion per year on average between dividends and share buybacks. All financial objectives for 2021 were met.
This was achieved through two major themes. First, reorganization of the group, done rapidly in 2019 — transforming from a vertical organization managed by product lines from Paris to a horizontal organization by country, with country leaders who have the full product range. Our Polish CEO Joanna Tync is Polish in Poland; Mr. Nguyen is Vietnamese in Vietnam; Mr. Marco Corales is Mexican in Mexico. Ninety percent of our leaders are native to their countries. This proximity is very relevant for our business — construction differs from Vietnam to Canada, from Argentina to Norway. Products don't travel. Our factories are very local — 1,100 in total. Local clients, local construction methods, local factories — so organizing by country was very pertinent. The second theme was evolving the group's perimeter — 40% of revenue was renewed, with €10 billion divested of peripheral activities far from the strategy, and over €7 billion in acquisitions perfectly aligned with the strategy. This also evolved our geographic presence. Until 2018, 70% of revenue was in Western Europe. Last year, 50% in Western Europe, 22% in North America, and about 30% in Asia and emerging countries. We completely rebalanced results: Western Europe now represents one-third of group results, not 60%. One-third in North America, one-third in Asia and emerging. The group is considerably stronger and more resilient than a decade ago, with about 125 to 130 acquisitions and about 100 divestments over 5 years. Our acquisition of Continental in US drywall doubled our size there and created value from year two. We tripled in size in Canada. The acquisition of CSR in Australia provided important scale and attractive margins.
Alongside this geographic development toward North America, Australia, India, and the Middle East, there was also development of construction chemistry. This segment brings performance and durability to buildings and infrastructure — waterproofing joints, exterior insulation renders, flat-roof membranes, concrete admixtures, cement additives. We grew this presence from €2.8 billion in revenue in 2019-2020 to €6.5 billion last year through several acquisitions. The first was Chryso in 2021 — a beautiful company that had belonged to Lafarge, divested in 2001, under private equity for about 20 years, which we acquired in October 2021. It was mainly French, with some presence in Turkey, South Africa, India, and North America. Then GCP — Grace Construction Products — an American company, our second public tender offer in the US after Continental. GCP complements Chryso geographically, as it was very present in North and South America. Then Fosroc and Mix, also complementary in construction chemistry. Fosroc is the reference brand in the Middle East and India, and Mix is a leading construction chemistry company in Mexico. Those were the most symbolic strategic movements of Saint-Gobain in recent years, along with many smaller geographic additions.
More recently, as we reach the end of our 2021-2025 Growth & Impact plan, we launched in October 2026 — I chose a date that in retrospect was somewhat unfortunate, October 6, the day of the ephemeral first Bayrou government — our strategic plan for the next five years: Lead & Grow. This is continuity of the same strategic vision — world leader in sustainable construction — with the same perfect alignment with our purpose, Making the World a Better Home. We replaced Growth & Impact with Lead & Grow. It is fundamentally the same strategy, which we've seen bears fruit in terms of geographic expansion and financial results, just a bit deeper in solution richness, a bit broader in some markets and geographies, and with the same country governance that makes Saint-Gobain's strength today in the 80 countries where we operate. For the financial targets: Lead & Grow raises our growth targets to mid-single digit — roughly 4 to 6% — up from 3 to 5%. An EBITDA margin of 15 to 18%, up 2 to 3 points from the previous plan. Strong discipline on free cash flow conversion. Return on capital employed above 13%, strongly value-creating. Net debt to EBITDA ratios between 1.5x and 2x, with solid financial structure and very good credit rating. We will continue rotating revenue — always seeking geographies where we can gain market share and make acquisitions to improve growth and profitability, and divesting when businesses or presences are better entrusted to others. An attractive shareholder return over the next five years: €8 billion total, mainly dividends — €6 billion over five years — and €2 billion in share buybacks, broadly in line with our commitments over the past five years. And in terms of geographic evolution, as I indicated, we will continue.
In recent years, we were globally at around 70% in Western Europe. Today, depending on the exchange rate, it's around 50-51%, and 50% in Asia and emerging countries. We aim to be globally at 25-30% of revenue in North America over the long term, 30 to 35% in Asia and high-growth geographies, emerging countries, and 40 to 45% in Western Europe. If you look closely at the bar chart, you'll see that Western Europe is not declining — the grey bar is rising. However, the relative weight of Western Europe decreases slightly from 50% to 40 or 45%. What we anticipate over the coming years is revenue growth of 3 to 5% in Europe and faster, stronger growth of 5 to 8% in North America, Asia, and emerging countries, where we will continue in the same way we have in recent years with the same discipline in allocating the group's capital to seek growth and profitability in geographic areas where we still have much to do and gain in market share.
The main criterion for Saint-Gobain when looking at a country is population growth. Because population growth means construction growth. There are still geographies — take Egypt, which I mentioned earlier. Today we do about 100 million euros in revenue in Egypt. There's no reason we shouldn't one day do 500 million to 1 billion. The Philippines, which is a very large country by population, where Saint-Gobain does tens of millions of euros in revenue — there's no reason it shouldn't become a country with 200, 300, or 500 million in revenue. So that's what we look at across about fifteen priority countries so as not to scatter. We're not going to 80 or 100 countries, but there are about fifteen priority countries. I mentioned the Middle East — that's three countries: Saudi Arabia, Turkey, Egypt. North America is the United States and Canada. Latin America is Mexico and Brazil. Asia is several large Southeast Asian countries — Vietnam, Indonesia, the Philippines, and naturally India. But smaller countries like Cambodia and Thailand don't have the same growth prospects. So we have well-defined allocations and priorities. That's the overall trend for the geographic evolution of our revenue, given that we are already a leader, as I mentioned in terms of results.
The second topic is that Saint-Gobain has historically been very present in residential markets — buildings for living, housing — with a stronger presence on average in renovation than in new construction. We aim to leverage our expertise, our solution offering. In the Saint-Gobain Tower, there are 82 Saint-Gobain products. Typically, the Saint-Gobain Tower is a non-residential building, an office building. And this expertise with 82 products — we believe we can express it even more strongly in infrastructure and non-residential markets. Today we do 15 billion euros in revenue there, and we aim to increase this presence over the coming years. All the moves we've made in construction chemicals — you've seen construction chemicals — are applications like tunnel waterproofing, mine waterproofing. So we can go into mining markets, which isn't intuitive when you think of Saint-Gobain, because you think glass, plasterboard — you don't put glass in mines. But with our presence in construction chemicals, we can do waterproofing on mines, tunnel waterproofing. We're present in major transport infrastructure — rail in the UK. We're present with certain major French partners on the Lyon-Turin tunnel. Increasingly, we've done several dozen kilometers of rail tunnel in Romania. So there too, infrastructure markets, thanks to our ambitions and presence in construction chemicals — we're going to accelerate in these markets. So a gradual evolution there too, staying in construction but remaining focused while leveraging our expertise across a broader range of markets: residential, non-residential, and infrastructure.
A recent example: in Vietnam, we won a very strong presence at a new airport. Half of Saint-Gobain's offering and revenue at an airport is the building itself. So an airport building, if you forget the runway, for which we can leverage concrete — an airport building isn't very different from a building like the Saint-Gobain Tower. Obviously you need to pay attention to acoustics. We put in solar-control glass if you want to be able to look at airplanes even with the sun in your face, or maintain temperature without too much air conditioning inside if you have solar control. So it's fundamentally a building, an airport building, but with different cycles and different client stakeholders.
So those are the major markets where we're going to develop. You can see that the playground for Saint-Gobain is truly considerable — it's 500 billion euros of revenue in residential, non-residential, and infrastructure. I'll now illustrate briefly our solutions across these segments. I'll take the example of renovation — possibly the expression 'energy sieve' in France, but I believe it's become somewhat generalized in the media. With about thirty recommended Saint-Gobain products and point-of-sale delivery, along with digital solutions that Point P puts at artisans' disposal to help them prepare quick quotes and have the right solutions, we can reduce energy bills by 70%, upgrading a building from an energy performance rating of G to C. And given energy costs, the return on investment is around 5 years. We train nearly 100,000 artisans per year with Saint-Gobain's advice on this type of work. So there's a very strong presence to help France improve energy performance, and this return on investment doesn't even include the real estate revaluation of the property. You may have seen articles in the press — we've mentioned this several times in our slides — there's a 40 to 45% gap in property value between the listed price and the discount for F or G-rated buildings, or the premium for A or B-rated buildings. So you have an interest in either negotiating a discount if you buy a building you know will need renovation, or in renovating before putting a property up for sale.
We also have a range of flagship products to accelerate in non-residential markets — educational buildings, universities, schools — notably very high-performance acoustic ceilings. In hospitals as well, for example, we provided over 25 Saint-Gobain solutions for the construction of the Nantes University Hospital, which is the most complex construction site of its kind in Europe today. An array of products: in a hospital room, you can have up to six different plasterboard panels for different applications. And naturally, hotels — in countries like Mexico or Dubai, there are major hotel constructions in tourist areas where we can bring many solutions: fire-rated glass, solar-control glass, privacy glass between the bathroom and bedroom, acoustics. We've all been bothered by ventilation noise in certain American hotel rooms. Well, you can have proper ventilation with Saint-Gobain products and especially good acoustics. So there are many applications in non-residential and in infrastructure — major projects on viaducts in England, on a metro in Doha, Qatar, and a power plant, a major dam in India where Cristal and Fosroc are number one and provide nearly ten Saint-Gobain solutions on major civil engineering works with significant technical know-how and performance.
We will continue, to remain relevant across these three major markets — residential, non-residential, and infrastructure — to enrich our offering in sustainable construction across these solution families: interior, exterior, construction chemicals, which I mentioned earlier. With a progressive evolution and an ambition to continue evolving Saint-Gobain's businesses over the long term. I'll conclude with a slide that summarizes our growth ambition in 'Lead and Grow.' It's truly about providing answers to all these growth opportunities I've mentioned — mega trends: climate change, population growth, rapid urbanization, energy efficiency. Very strong growth opportunities, a governance and organization that doesn't need changing — it's been in place for six years now and it works. We have country managers who are very experienced, natives of their countries. They're going to accelerate a bit further, go a bit further, be a bit richer in terms of solutions — that's the third part of this slide: a solutions-based approach focused on value-added. So a pricing power, in the financial jargon of Saint-Gobain, to value complete systems. And all of this by going into playgrounds, growth territories beyond residential towards non-residential and infrastructure. So this is truly an ambition for growth, profitability, a robust and well-established organization. I'm very confident that this 'Lead and Grow' trajectory, this strategic plan, will be strongly value-creating for our shareholders and all stakeholders, and that we'll be able to continue improving Saint-Gobain's results, our clients' recognition of our solution performance, and naturally that this translates into something attractive for our shareholders as we've managed to achieve over several years. You kindly recalled it in the introduction. The performance of Saint-Gobain: 16% per year dividend growth since 2021, a share price multiplied by 3 — well above the CAC 40 — and a total shareholder return of around 20% per year since 2019.
Thank you very much for your attention, and we now have time to answer all your questions.
