[R]1:00AM New York - The world’s largest cement maker Lafarge SA reported that net income in the first quarter ended March 31st, excluding capital gains, rose 49% to €150 million from €101 million a year earlier.[/R]

Quarterly Earnings Review

Lafarge reported sales in the first quarter ended March 31st rose 8% from €3.6 billion a year ago to €4 billion boosted by strong sales to emerging markets.

For the quarter, net income, excluding capital gains, advanced 49% to €150 million from €101 million a year ago. Basic earnings per share increased 36% to €0.79 per share from €0.58 per share.

Free cash flow in the review period rose 88% to €391 million from €208 million from the comparable quarter a year ago.

Lafarge’s group debt also increased 91% to €16 billion from €8.4 billion in the first quarter of 2007.

Segment Review

Cement

Sales in the cement division increased 16% to €2.55 billion, while current operating income grew 57% on the year to €469 million.

Growth in the segment was particularly boosted by solid and strong growth in the emerging markets, which generated 75% of the business’s income.

Notable growth was realized in Central and Eastern Europe and Asia, and the contribution of newly acquired Orascom Cement’s operations, which positively impacted on profitability.

The company fared well in North America despite lower sales volumes that were occasioned by slowing economy as the positive pricing trends managed to offset the rising energy costs.

Aggregate & Concrete

Sales in the division fell 3% to €1.23 billion, but current operating income advanced 44% to €26 million, buoyed by price increases and cost reductions.

However, volumes were mainly lower in the first quarter on the credit market turmoil and poor weather conditions.

Growth in operating income driven by price increases and cost reductions, despite lower volumes in the first quarter due to the slowdown in the US and poor weather conditions in certain markets.

The continued development of value-added concrete products accounted for 23% of volumes in the first quarter of 2008, compared to 20% over the same period in 2007.

Gypsum

Sales declined 4% to €398 million and current operating income down fell 57% to €20 million on exposure to the slowdown in the US residential market.

Higher energy costs were also offset by price increases.