Ladies and gentlemen, welcome to the Saint Gobain Conference Call. I now hand over to Pierre Andre, the Salinda Chairman and CEO. Sir, please go ahead.
Good morning, everybody. I hope that you have at time to, review our press release and that you have been able to go through the highlight of our first quarter sales Let me first sum up in a very few words, our performance. So you have seen that our organic growth is at 5.7% coming both from prices at 2.6 plus 2.6% and volume at plus 3.1%. So we clearly started the year off well with good sales trend. This was helped by supportive market.
And an easier comparison basis given the harsh winter weather we saw in Q1 last year in Europe. We once again demonstrated our ability to increase prices in an environment where we continue to see inflation in raw materials and energy but a bit less so than in 2018. And Sreedhar is now going to give you additional information, including by our new reporting segments.
Thank you, Piran Reid. Good evening to everyone. Let me give you more details about our sales for the first quarter. Sales increased by 5.7% on a like for like basis over the first quarter and 6.4% on a reported basis, with a positive impact of 0.6% from exchange rates and 0.1% from structure. I will take a moment to give you some more details on these two effects.
The exchange rate impact turned positive for the quarter. After we saw the significant negative impact last year, This was driven primarily by U. S. Dollar turning positive against the euro despite the continued negative impact from the Brazilian real and the Norge Krona as well as the emerging currencies. The currency impact was positive for all our new reporting segments apart from Europe.
The structure impact was almost neutral with the impact from the acquisitions being offset by the divestments, especially part of our pipe business in China. The acquisitions impact reflected the acquisition made in new niche technologies such as Cayman in technical solutions emerging markets like joint leader in Addisys in China and in the reinforcement of our strong positions like Hunter Douglas in the ceilings business. The impact was positive in all segments, apart from in Asia because of by China. Now coming back to the most important part, the like for like growth. We started the year with a very good sales trends.
Helped by overall supportive wider markets as well as an easier comparison basis due to the harsh winter weather that As a result, group volumes increased by 3.1% for the quarter. We also achieved the pricing of 2.6 percent in Q1, and we're pleased to see our focus of pricing payoff once again. This is important as we continue to see inflation in raw materials and energy, even if current price prior current price trends confirm that the inflation should be less than 2018. Regarding the impact of working days, the first quarter had a small negative working day effect of around minus 0.5%. We will still see a negative working day impact in the second quarter of around minus 1% and then catch up these negative impacts in Q3 with a positive impact of around 1.5% and Q4 should be slightly negative.
I will now comment on each of our 5 new reporting segments. Starting with high performance solutions, we saw like for like growth of 2.4% in Q1. Industrial markets were overall supportive, apart from the weakness in automotive market. Mobility market held up well despite the declines in automotive in Europe and in China. Supported by market share gains.
Our differentiation strategy of moving towards high value added products continues to pay off. In the industrial market, the sales stabilized. The level of activity in ceramics is in line with second half twenty eighteen. North America was slightly down as a result of a high comparison basis, while Asia and emerging countries continue to advance. Activity is serving the construction industry showed strong growth in our main regions, Europe and the Americas.
And finally, the life sciences continued to show an excellent growth dynamic. Coming to the regions, the Northern Europe grew 7.8% like for like in the first quarter, helped by the easier comparison basis given the harsh winter weather last year and benefiting from the bird market conditions in our main countries. Distribution in particular had a very good start to the year and our industrial businesses progressed well. The Nordic concluded off the year with very good sales strength in all businesses. In particular, distribution which showed double digit organic growth.
The construction market continued to show good sales momentum. In the UK, despite the uncertain market environment, it continued to grow. Germany promised well continuing on from the better trends seen in the second half of twenty eighteen. And lastly, Eastern Europe continued to show good growth in all our main businesses and countries, particularly in Poland, Czech Republic and Russia. Coming to Southern Europe region posted good organic growth of 5 pound of 5% on an easier comparison basis given last year's harsh winter weather.
The growth was led by distribution and all industrial businesses grew, especially plasterboard insulation and motors. Pipe sales increased slightly along with our efforts to improve its competitive. France continued to show good growth trend with a very good start to the year. Once again, supported by both renovation and new construction market. Insulation continued to benefit from strong demand in energy efficiency related innovation.
Amongst our other countries in the region, Spain posted good growth Benolex and Italy progressed. The Middle East and Africa had a more difficult start to the with sales down for the quarter, particularly in Turkey. One word on distribution across all Europe. It had a good start to the year with sales up by 7.3% like for like of which pricing contributed to 1.5%. The Americas region grew by 4.6% on a like for like basis.
North America benefited from good pricing at the expense of volumes. In a context of continued raw material inflation. Exterior product stabilized on a tough comparison basis, benefiting from strong pricing In Latin America, we saw a growth strong growth once again with an accelerated recovery of Brazil. Now coming to the Asia specific region, increased by 7.7% organically. Supported in particular by building glass and class robot.
India benefited from additional sales from its new float line start of 5th float line and the plasterboard continued its strong growth trajectory. Amongst our other countries in this region, China also grew. In summary, we have started the year with a very good overall sales trends particularly in Europe with an easier comparison basis, and we continue to have a good pricing level. I will now hand over to Pierre Andre for concluding remarks.
Thank you, Sreedhar. So now let me make a few comments about our strategic priorities and the outlook for the rest of the year. 1st, our new organization structure has been fully in place since January 1st, And the enthusiasm of the team on the ground is very encouraging. We are on track to unlock 1,000,000 in additional savings by 2021, and our program to divest businesses representing more than 1,000,000,000 in sales by the end of this year is progressing well. With divestments, representing over EUR 2,400,000,000 of sales already completed or announced.
We confirm our action priorities for the year in terms of our cost savings program with EUR 300,000,000 of additional savings through our operational excellence program as well as more than EUR 50,000,000 savings from the Transform and Group program, mainly to a SG and A reduction. We confirm our CapEx program, our commitment to R&D Investment and our focus on high level of free cash flow generation. And I reemphasize our focus on pricing. So We confirm, in fact, the outlook for our new reporting units in 2019 for high performance solution, the industrial market should remain supportive, particularly in the U. S.
Despite uncertainties on the automotive market in Europe and China following a difficult start there. Northern Europe should progress despite uncertainties remaining in the UK. We expect overall growth for the region of Southern Europe, Middle East and Africa, with a construction market in France, which should be supported by progress in renovation, while new construction could be more difficult from the second half. Market growth should continue in North And Latin America and we expect further growth in Asia. So to conclude and as you have seen in the press release and in line with our objective as announced in February, we are targeting with confidence a further like for like increase in operating income in 2019.
So now Shreedhar and I, we are happy to answer any questions you may have.
The first question comes from it's from Exane De Taiva. Sir, please go ahead.
Good evening, gentlemen. I will have two questions if I can. My first question is on underlying trends. We have seen some of your peers in the U. S.
Cutting their gross projection on the back of slower demand in new residential construction and also some industrial markets. And some European names are also talking, as you just mentioned, about sequential slowdown in new building activity in H2. Could you maybe help us to understand how you see underlying trends going forward, especially in Europe and North America? And how you see that organic growth phasing throughout the year with a tougher base effect? My second question is on your capital allocation strategy.
Last time you updated the market, you mentioned that you would be undergoing further portfolio review to lead to additional divestments. Could you maybe update us on this and you're if you already have in mind a target in the medium term and also what is the group strategy in terms of the proceeds of those divestments? Thank you very much.
So, concerning the first question on our underlying trend, I would like first to remind you that at the end of February, when I presented the first result of 2018, I already told you that we had a good beginning of the year and I was reasonably optimistic for 2019 and at that time, I sounded more optimistic than uh-uh the investment community. I'm still in bad mood and the first quarter is clearly in line with our expectation. There was, as usual, during the first quarter in the winter season, some question mark, because you know that the winter has an impact Last year, we had a very negative impact in Europe, even more in the Northern part of Europe and the southern part of Europe. We had last year, a good weather overall in Europe. Concerning the U.
S, last year was called part of the U. S, this year was called as well. It's generally called in the U. S. In the 1st part of the year and not always the same way in the various regions, but I don't think there are significant weather impact.
So if I exclude this weather impact, gender line trends are in line with what I have in mind and they are good. You have seen if you do some, you have mentioned some competitors or peers who have expressed recently sales for the first quarter and outlook. Our sales for the first quarter in the same businesses are better. Both as far as industrial markets are concerned and in construction in the U. S.
Where we have put a very strong focused on pricing. So concerning the trends going forward, I have not changed the scenario we have had for the year. We have not seen a change in the trial. We said that the industrial markets would continue to grow at a lower pace than last year. We are seeing that.
And in construction, I expect as I said, the construction market, the new construction market in France to go down in the second half. But the innovation, I would say, the trend is enough to trim off is probably a little bit better than what's good as expected. So I don't change at all my views on the French market. For this year. And we may have since I we may have some in terms of growth and stimulus on growth.
We may the news are slightly more positive in terms of economists than they were 2 months ago concerning Nordics where I have disagreed with the market analysts last year, We have a positive very good growth in 2018. I confirmed this year that we should have less growth, but a reasonable level. We have started the year extremely well or it's double digit nearly sales in the construction market in the Nordics. We are not going to continue at that level. Clearly, there's also the Easter impact, which that I expect.
I have not changed my forecast for the year. For the Nordics. And then there is always a question which is, which I have never able to answer completely is that when you are bad weather, are you going to recover? And when you have a good weather, are you going to lose it again? Last year, in fact, we didn't recover.
Maybe we lose a little bit in April and May, but I am not that's not what I I expect at this time. So no underlying trends have not changed from what I was having in mind in February. And we have had a good start to the year in addition. Now on your second question on capital allocation, I have as no more comments to make on that. That's what I said in February.
We have started a number of reviews within the framework of our new organization, but there is no decision which have been made and I have no specific number to communicate. We are progressing well with our current plan that to divest a EUR 3,000,000,000 of sales this year. And we will for the time being, in terms numbers, I concentrate on that. We are we have a number of reviews going on. And but I have no specific I think to communicate today concerning the proceeds, you know, they will fuel our that will be part of the point, I would say, in terms of our CapEx, in terms of our dividend and which are always my first two priorities.
And then we will continue our program when the the opportunities are good until our small acquisition and our buyback program where we have already bought back 4,000,000 of shares in the beginning of this
Thank you very much. Could it be fair to assume that you actually see a little bit more optimistic today versus February?
No, I am not much more, no, no, I'm not more optimistic than in February. I am not more negative, I was not very negative. I think there are some areas which are going to stop, but there are some good areas. I am I have the same mood for the rest of the year. That I have, what has changed is that, I told you that the year has started well.
I think we have had a good first quarter in the bank, which is good also. We don't comment on the on profit today, but it's already a good start of the year. Great.
Thank you very much. Have a good evening.
The next question comes from Elodiral from JPMorgan.
Hi, good evening, everyone. Couple of questions, if I may. First of all, on cost inflation, Please, could we have an update on energy and raw materials cost inflation? I think your previous guidance for the year was to be slightly lower than last year. So I think that it was an increase of 1,000,000 last year.
So please could you provide us an update in your view on this? 2nd, would you also have an update on the discussions with the government and the trade unions regarding the potential disposal of pipes the point I'm showing the recent news flow. And if I may ask a third question on HPS, the like for like growth has been a bit slower in Q1 than last year at 2.4%. Notably, you mentioned that the activity has stabilized in ceramics, so that led to North America being slightly down. Yet in the outlook, you're getting for industrial markets to be supportive in America.
So does that mean that you expect Sierra mix to pick up in H2 or what would drive most portable to? Thank you.
So the first question on the inflation, we continue to see the inflation in raw material and energy. Having said that, it still remains quite volatile. You see that the oil price in, October, it was, 86 and December it became 50. And now it's again back to 75. So it still remains volatile, but I can only say that the trend which I see the current trend, the prices of our raw material and energy, I can only confirm that it should be lower than last year.
And the first quarter, I think we have have a
good positive set. In terms of the pipe, there have been a lot of comments from outside Saint Laurent on the in this topic in the French price. I have not commented and I don't have I have nothing to say about it. We are we are continuing the recovery plan that we announced it in months ago and it's progressing well. At the same time, we are, as Sreedhar mentioned in February, we are reviewing the best strategic option for the evolution of this business.
And we have started primary studies regarding a partnership that we could have for all our parts of our business. We have several options that we are currently looking at, but I have no additional command to make at this stage. And this is primarily studies. Concerning Americas, we also have
the HPS. Yeah. Concerning our HPS, we just have to keep in mind that the last year, the the we had the the ceramic was exceptionally good, the good year for us. And, so it's a it's a base a comparison basis, which is high. Otherwise, it's in line with what we saw in the second half.
Right. Thank you very much.
The next question comes from Janice Stoss from Seyen sorry, CMCAM sorry, CAC.
Anyway,
a very difficult name. Sorry. Yeah.
You have a long name.
I'm a long name.
I didn't choose it. Sorry. I cannot choose, it cannot change. So a quick question for me. If you accept, first one, could we have more flavor on the North America business, we have 1.9% organic growth, so lower than, for the other geographical sales.
We have some details regarding materials and HPL. Secondly, could we have the order of magnitude of flat glass pricing. And last question regarding the Provision made end of 20 year 2018 for German distribution. Is that sufficient to complete the deal or could it be necessary to make additional value correction for these assets. Many thanks.
So on the first question of, of North America, So, the activity level is reasonably good. I saw a one point 1.9%. In fact, if I see that our contraction activity is also slightly positive, and that there is a strong emphasis that we have put on price because we had increased in our raw materials. So we have a very significant price increase in the majority of our construction businesses in the U. S.
And we have had relatively low volume. In fact, the volumes are generally slightly negative. You need to remember that, for our biggest business, which is roofing in construction in the US, We have had a very high comparison basis. In 2017, there were very, very high sales, which maintained in 2018 because our our distributors were, putting inventory, hoping the same storm and the storm in 2017. So this year, we have had a lower volume, but we have had a good pricing And we expect, the year in terms of construction to hold up reasonably well with some good trends in renovation, which will continue to be good in volumes and construction activity, which is still at a relatively low level.
So I think that the fact that the volumes are down for the first quarter is not necessarily an indication that they are going to be down for the whole year. We expect more something like flat. So good news is that we have very good pricing, very strong price increase in the first quarter in North America. Concerning. So the activities in the HPS business are also positive globally the same the same more or less the same level, a little more driven by our Plastics Life Science business, which is very good.
And Ramix, that we should have already commented there a little bit down in the U. S.
Yes, I just want to add that, you, if you noticed it that the overall price increase in total Americas is 6.7%. It's substantially higher than all other regions.
Yes, in a Global America aspect for North America is the order of magnitude of the price hikes the same, I guess, slightly below.
It is slight slightly, but it's in the it's around 6%.
6%. No. Not very good. Thanks, Sreedhar. So regarding those questions, German distribution for sale and also surprise.
Well, we are in the process of of, we are on the process of divesting this business and we will give you more details when when we are, when the deal is signed, but I don't expect any problem.
Okay. And for the flat glass price level,
Yes. So the, you know, I know you would always ask for M and price. It's very it's same what I said in the end of February. So sequentially, it is stable. And if you compare with last year first quarter, it's 1.5% increase.
So it's actually it's a good good in a good shape.
Many many times for those.
The next question comes from Joseph Pujal from Kepler Cheuvreux.
Yes. Hello. Two questions. Hello. Two questions on my side, please.
On the price increases seen in Q1 and, yeah, which are slightly smaller than in H2 last year, but at the same time, you also say that the cost inflation is lower too. My question is, are those price increases of the Q1 enough to offset the cost inflation? In Q1? And my second question is on LATAM. When I look at your Americas reporting and also you give North America on the other side, I did not have the time to do the calculation, but that means probably that LATAM had an almost double digit like for like growth maybe.
Could you give more flavor on that? Was it linked to anything exceptional? Or could you give more flavor on that region? You see the purely the recovery of Brazil or are there other countries that they are doing very well? Thank you.
Okay. So I'll take the first question on the price inflation spread. As I said, the first quarter, the price inflation spread was positive. As you so we keep saying this quite often that we remain focused on pricing and that's something which has been, clearly one of the top most priority in the organization. Last year, if you recall, the second half, we actually privileged pricing over volumes.
And we ended the year with a higher price increase So so it was a clearly we were put in a positive situation in the when we started the year. So clearly, if you look at the pricing for the first quarter, it is very much in line with what we expected and it is certainly compensating the inflation. And that would remain our objective for the year to make sure that we pass on all the inflation to the market. Which we do it successfully year after
America, yes, we are double digit. In fact, we are at 13% like for like growth in Latin America. And most of our countries are doing quite well. Brazil has has had a good recovery in our construction market. Mexico is doing very well.
There is one country, which is a little more difficult than it was last year. Almost countries were very good. And on the back of the investments that we have made also, and the, which is urgent. It is a little more difficult since a few months. Than it was before, but good trends in both Brazil and Mexico and the other countries are where we are, which are a little bit smaller.
Thank you.
Next question comes from Ben Edelfair from Odo
Yes. Hello. Good evening, gentlemen. I had two questions. Firstly, the base effect was very favorable in Q1.
To what extent it will reverse in Q2 and potentially be negative? As this quarter was very strong last year, That's the first question. And the second question, the disposal program is progressing well. I would like to understand if Saint Gobain is preparing for a structural acquisition anytime soon. Or if you are in the mode of a disposal on reorganization?
Well, concerning the first question, I remind you a few things that we have already said is that last year, we had a negative impact this year on the working day in the first quarter, which is a negative 0.5%. So but on the other hand, we had, as I said, in Europe, not elsewhere, but in Europe, we had a difficult weather in in the month of March, especially last year. So yes, as I said, globally, the comparison basis was year because of the weather, but not because of the number of days. Last year, we had a good growth, in the second quarter that last year, we had one working there more. And we have the impact from a very low comparison because of the cyber attack in 20 and 'seventeen, which was more than 2% of sales in the second quarter.
So from that standpoint, you have to be careful when you look at the comparison basis of last year, which is more related to the year before than in absolute terms. So that's, then I, on the formula question, I said that the weather, we are going to lose back a little bit of the good sales because of the weather until uncertain last year, I don't think we recovered a lot of the last of the first quarter this year. I don't know I I don't know whether we may lose a little bit, but I I it's early to know, but those are the points. So The second question,
could you give us, sorry, could you give us a sense of our April year is progressing?
No, I don't have anything to say special on April. It's the only thing I know and it is very in some countries and in others is that the Easter week last year was in March and this year was in April But if I take that out, the trends in April for the timing, I don't see a change. So there are Concerning your second question, no, I didn't mention that in February, and I have no change, there is no change from that standpoint in my in our priorities, which is to continue our policy of in terms of M and A of small acquisition when they make sense. And we have done a few small ones, very small ones in the first a quota, including one that we announced in, yesterday in, to establish a profitable business in, in Mexico. That's, and then on, you know, about our divestment program.
And so that timing, I concentrate on those two things.
Next question comes from Arnaud Lehman from Bank of America. Please go ahead.
Thank you. Good evening, gentlemen. Two questions, if I may. Firstly, on the high performance solution division, you report broadly stable volumes. I know you don't report the old style anymore, the old divisions, but could we have a feel for the trends between, high performance materials and automotive glass?
Basically, I'm trying to understand if the automotive glass decline was offset by more positive trends overall in a PM. That's my first question. My second question is on distribution. You report 7.3% like for like growth for distribution in Europe in your appendix. Is it a level where you start to get positive operating leverage improvement in margins, including, obviously, the digitization costs that you half of this year?
Thank you.
Okay. So I'll take the first question on HPS. I know the sales of cigarettes, the automotive glass is certainly impacted negatively in Europe and China. But with all our initiatives, of working on value added products and developing compensate, maybe more than compensate, the downward trend, which we saw in these two regions. So I just want to confirm that, cigarette, automotive glass had a positive, like for like growth in the first quarter.
Yes,
it's in line with the average of live performance solutions.
And the second question, yes, we don't we don't give a profit profitability by quota. Number 1. Number 2, I don't expect a sales of the distribution division. Like for like to be at 7% for the year. And third, I confirm what I said in February, which I expect to improve the margins for the whole year in distribution.
But you can, you can be right from that that we have taken a little bit of of concept in the first quarter.
Next question comes from Will Jones from Redburn.
3, if I could please. The first is coming back to France. When we looked at the second half and you highlight that will likely decline in new construction at that point. Do you have a a number in mind or a scale of the decline that you might see in that area of construction in France in the second half? And when that happens, do you think that renovation and other areas can kind of offset it.
The second was just focusing on Germany, which way sounded quite positive in the statement. It's a country where recently you flagged issues around labor availability. Are those problems being overcome there now? And I guess more generally on labor availability are there any countries where that's an issue currently? And then the last one is just more a point of confirmation, but obviously in the first half of the last year, you'd see some issues around production facilities in Flat Glass.
Can you confirm that across your portfolio, there's nothing that we need to be aware of around any production issues at this point in time? Thanks.
So concerning labor availability, I don't have specific new comments on that. I just want to say that you could be disturbed by the fact that we have a very good growth in the first quarter and on the other hand, how we can sustain that given the fact that we have we have we quoted this labor of EBITDA, but you need to have in mind that the absolute level of activity in the winter is clearly lower. I mean, summer. So the adding more activity in the winter is not is not an issue for a small midsized company who has people who sometimes are not busy enough in the winter. So I think that doesn't change the overall picture, but it's not a factor during the winter.
Concerning Germany, I must stress that we saw already explained in the construction market, much better trend in the second half, which were globally compensated in Saint Gobain because we saw a decline in Germany in the automotive market in the 1st in the second half of last year, especially. And we see those trends are continuing So, if I take out the fact that the weather has helped in the first quarter, I think the trends in construction are a little bit better than they were 1 year ago, and we see a continuation of the trend of the last few months. And I am positive for Germany for construction activity this year. You know, I don't know whether it's the labor availability has been completely solved, but I think there are some progress in Germany. That's the second question?
Questioning fraud, yes, I made a lot of comments about that in February and there is no no charge in my view I consider that the renovation, which is slightly improving and we'll compensate the decline in new in the second half. That's what I'll be new you need to have in mind that our renovation market for Saint Gobain is much bigger. It's about 70% versus 30% for the new construction. So that's the reason why So the rate of growth in renovation will be less than probably the rate of decline in new, but I think they should compensate at least for Saint Gobain in the second half?
Is there industrial issues a flat class. I mean, I can answer that. I think, as we said in February, I think all these issues are behind us, It's true that we did have an impact on our results last year. And there are no no such big issues?
That was solved by the
third quarter. Yes. So there are no, to be precise to your question, there are no big issues to talk about at this point of time.
Next question comes from Robert Garner from Davy. Sir, please go ahead.
Good evening. Thanks very much. 2 quick ones from me. So one, you might just expand on your comments on the UK. I know there's little you can add in terms of politically, it has the outlook there, but just in terms of, how the market is trended for you through Q1, how you think about it for the 12 months.
And I also note in your Northern European division, you talk about strength, particularly in chips and the mortars. I'm just wondering what you saw in insulation across Europe through the first quarter. Thank you.
So concerning the UK, there are uncertainties and we don't know what's going to happen. That being said, we had a reasonably good first quarter in the UK also because the weather was not very good in the first quarter of last year. So we had so an easy comparison, but I would say that the sales all very well in the UK, globally, around 5% like for like for for Saint Gobain in the first quarter, both volume and price. I, I think also we have, we have, in some businesses, at some good, good activity. I am still, uncertain for the year, depending on the scenario about about Brexit, but for the timing, it has been, it has been, it
has been going well. The other question was on installation. I think we have a good trend of installation. The first quarter was good for us.
Yes, especially in transit. We had a very good, I think the energy renovation market for our insulation business is It is picking up quite strongly. In fact, we have been we have some small debottlenecking CapEx, which are really needed, which we are coming into place. We have a good market, especially in France.
Next question comes from Gregor Uglesh from UBS.
Hi. Thanks for taking my questions. So two questions. One is on the new organizational structure. Can you give us a bit of a feel?
I know it's still early days how things are going, any kind of positive and negative observations so far? And then second question is Obviously, you've announced a few disposals or planned disposals in distribution. There's a number of assets on the block. For instance, in the UK, are you looking at these or are you simply saying at this stage that's not for you? Thanks.
You mean, acquisitions and distribution?
Well, you've announced disposals, but would you consider some consolidation moves given some of the assets that are up for sale or is that not on the agenda for
No, no, I don't think it's, I don't think it's on the agenda for us, especially a large operation. That's not the way we look at it. Concerning the new organization, I think it's as I said in my introductory comments, I think it's going, it's going quite well. I think that the fact that we have given a simplified and given more responsibilities at the country level is very well received in the countries. And I think the at quarter functions, which were maybe a little bit as I was among anxiety, we moved very fast because we as I explained in February, we've announced many moves in the between the end of November January.
I think all that is in place now. So I think I see some momentum is quite good in this reorganization and I feel very confident.
Thank you. Thank you very much.
We will issue more in July, I guess,
on the on the savings and how things are progressing.
Next question comes from Navin Ahmed from Barclay.
For taking my question. I actually got 3 very quick ones, hopefully. First one, on the pricing effect in Asia, the plus 0.7%. This is looking relatively low considering, I assume, significant cost inflation in those countries. Could you come back on that and is it a mix effect or any specific reason why the pricing is looking lower than for the rest of the group?
Second question coming back on the distribution year of performance, the 7.3% like for like growth. And forgive me if you already mentioned that number, but how much was pricing into the life for life change? And finally, Pierre Andre, I think you mentioned some possible fiscal stimulus in your introduction. I guess you were talking about France specifically. Could you elaborate a bit on what you would expect there?
Are you referring to the new measures by for the renovation and talking about the development scheme. Is that also the reason why you sell a little bit more optimistic about France renovation market? Thank you.
So I'll take the first two questions. So pricing in Asia, it's true that it's lower as compared to what we have realized in other regions. It's primarily we had, certain challenges in Southeast Asia, to raise the price. Even China was, I would say, a bit of a challenge to, push the price. I mean, and it's sometimes it's quite normal situation when you have the volumes, not there, and the market is in a difficult situation.
Pushing price also becomes equally a challenge challenging point. So second question on distribution, Europe, we have one point 5% is the price impact, overall overall. So that's the volume. Yes. Yeah.
Rest is the volume.
Concerning NRG Innovation, I think that there are 2 measures which are gathering speakers. The NRG is a ticket is quite effective in France. 2nd, there have been a few things following, I would say, So, you know, that movement on the announcement that our president made concerning reintroduction of tax credit for, for Windows, which is also positive. Then you there are some tax, small things on the buying buying goods in the all goods to make renovation. There are some tax incentives what is called the the Normandy scheme, which is a little bit early to say whether it's going to be very significant, but it's going in the right direction.
And then on the front, we have had a 1st quarter, which was relatively good. I, the, at station of the craftsman is also saying that it's a little bit better than what they said 2 months ago, which is in line with our members, even numbers are a bit better than their numbers. And then I don't know what the president is saying at the moment, but maybe there is a little more. I saw that there was yesterday an agreement on social housing, which is also positive. So I think the idea of helping Energy Renovation is France is, is, an idea which is, popular at the moment.
How the teams are going to be done exactly. There are some to be seen. And some historically have worked from our Blackboard, but I think I would say that the the general feeling is, it's probably on those topics a bit more supportive than it was 6 months ago.
Next question comes from Eric Lemaye from Biannonia.
Yes. Good evening. 2 quick questions from my side. First, going back to France and Renovation, what your view on the growth of the renovation market in France currently? I mean, in terms of number, what is the market growth in your view, especially for for the energy efficiency, renovation.
And, still in France, do you already see today on transfer from the new residential to the renovation market in France. In Q1 or is it not the case yet?
Well, Q1 was quite strong and there is also this weather impact. What I would say is that the trend I see at the moment on the renovation for the market is around in volumes. It's around 1.5%. Obviously, the activity was higher in the first quarter, but there was also this weather impact. And as I said, as I said, for the for Germany, the level of activity still in the first quarter is always lower than in the summer.
So that's not now do we have, I would see the contract on new to renovation yet. Honestly, I I I I don't know. I don't think the new activity has started to slow down in the first quarter. I have not seen that yet.
Okay. Okay. Thank you.
Okay. Well, thank you and listening to everybody. I will our next conference call will be on July 25th for the for the first half results, but I will also make some comments at our general shareholders meeting in early June. Thank you.
Ladies and gentlemen, this concludes today's conference call. Thank you all for your participation. You may now disconnect.