HERACLES Group of Companies today announced sales of euro 299 million for the first semester of 2004, increased by 7.6% compared to the previous year. The increase in sales reflects a domestic market with improved prices versus last year but volume trends now showing a slowdown in demand following the completion of the Olympic projects, as well as a recovery in exports with an improved product mix.

Gross margin increased by 16.6% compared to previous year, reflecting further cost structure improvements at parent company level such as fuel optimisation and reductions in energy and labour cost.

Operating expenses decreased by 3.1% compared to 2003. Net financial expenses decreased by 68.6%, as a result of the significant reduction of net indebtedness due to the realization of operational cash flows.

The total operating income after financing of the Group amounted to euro 55.9 million compared to euro 42.2 million in 2003, reflecting the aforementioned improvement of gross results and the reduction of operating and financial expenses. Profit before tax amounted to euro 55 million after extraordinary and non-operating expenses, compared to euro 40 million in the previous year.

HERACLES Group of Companies, a member of Lafarge, has 3 cement plants in Greece. One in Volos, which is the largest cement plant in Europe, one in Halkis Evia and one in Milaki Evia. The total production capacity of the Group is 9.6 million tonnes annually, which makes it the largest cement producer in Greece. HERACLES Group is also active in the production and sale of ready-mix and aggregate products.

Lafarge is the world leader in building materials, and employs 75,000 people in 75 countries. The Group holds top-ranking positions in all four of its Divisions: Cement, Aggregates & Concrete, Roofing and Gypsum. Lafarge posted sales of ? 13.6 billion in 2003.