Saint-Gobain's CE, Piere Chalendar expects some emerging markets to be the first to recover from the economic downturn, in particular Brazil & Asia. EU recovery will be behind that of other worldwide regions, but SG will strongly benefit from its positioning in businesses aimed at improving the environment, with environment-friendly & energy efficient construction materials & building techniques. "For the sectors I'm interested in, we will have a significant positive impact in EU countries next year from stimulus plans," he said, adding that the full effect of Saint-Gobain's cost saving plans will also filter through in 2010, while its hedging strategy will help protect it from rising commodity prices for future months. Chalendar increased the company's cost savings target for 2009 from EUR 600M to EUR 700M, in response to the worsening trading environment. "We're ahead of schedule on the cost saving plan," he said, but would not say if Saint-Gobain would consider stepping up savings further than EUR 700 million. "I said (we'd do) at least EUR 700 million." "What is important for me nowadays is the spread between prices and costs," Chalendar said. "The increase in oil prices won't have an impact on us before at least six months." He said that the company is prepared to further adjust capacity to protect margins but warned that it is becoming increasingly difficult to raise prices due to weak demand. "Saint-Gobain always favours prices over volumes, which means we adjust our capacities if necessary," he said.
