WRAPUP 1-Emerging markets give Holcim, HeidelbergCement hope

* Firms say conditions tough in US, Spain, E. Europe, UK

* Holcim's emerging markets presence slowing EBITDA decline

* Holcim gets rights issue backing for Cemex Australia buy

* Holcim shares down 3.5 pct, HeidelbergCement up 5 pct

By Katie Reid and Christoph Steitz

ZURICH/FRANKFURT, July 8 (Reuters) - Resilient demand in emerging economies is helping cement makers Holcim (HOLN.VX) and HeidelbergCement (HEIG.DE) to cope with crumbling construction activity in many mature markets, the groups said on Wednesday.

Holcim, the world's No.2 cement maker, expects conditions to remain difficult this year as fewer new buildings go up in the United States, Spain and Eastern Europe, while HeidelbergCement grapples with falling sales in the UK. [ID:nL8711576]

But Holcim, whose shareholders backed a move to raise fresh funds for the A$2.02 billion acquisition of debt-laden Cemex's (CX.N) Australian business on Wednesday, said emerging markets were helping to slow a decline in earnings. [ID:nL8437683]

Activity in the construction industry has slowed sharply, notably in maturer markets, due to a slump in property prices and smaller corporate capital budgets, eroding profits across the sector.

On Tuesday, Irish buildings material group CRH Plc (CRH.I) (CRH.L) cautioned trading would remain extremely difficult. [ID:nL7424794]

"There are some markets which are difficult, the U.S., Spain and the UK are still difficult. But ... we are quite positive about the emerging markets, like Asia Pacific and India," Holcim Chief Executive Markus Akermann told reporters on Wednesday on the sidelines of an extraordinary general meeting.

"India has a cement consumption growth of 8 to 10 percent, it depends on the region," Akermann said.

"We had an excellent half year volume-wise in India," he said, adding that Latin America was resilient and Africa and the Middle East had developed positively, while cement consumption in China was up 14 percent in the first four months of the year.

Emerging markets account for some 75 percent of Holcim's cement capacity and it is well placed to benefit from increased spending on infrastructure in developing markets like India, which is investing in railways, shopping centres and airports.

HeidelbergCement, which unexpectedly published five-month key figures showing operating profit of 291 million euros ($406.8 million), also sounded an optimistic note about China and India.

"Although important aspects of macroeconomic development remain volatile, first signs of improvements can be seen in ... China and India, as well as Australia," the company said in a statement.

By 1338 GMT, shares in HeidelbergCement were some 5 percent higher at 27.90 euros, while Holcim shares were down 3.5 percent at 56.30 francs. The DJ Stoxx European construction index .SXOP was down 0.5 percent.

"Altogether positive news (from HeidelbergCement), but the biggest surprise is the trading statement itself. Probably an indication for a new approach of investor relations, hopefully not only in front of a possible capital increase," said DZ Bank analyst Marc Nettelbeck.

TARGETING GROWTH MARKETS

Holcim's purchase of Cemex Australia, its largest acquisition since 2005, boosts its presence in an economy that has proven relatively resilient to the downturn, has rich mineral reserves and is in striking distance of China and India.

The group is funding the buy as well as an increase of its stake in China's Huaxin Cement through a rights issue and said the gross proceeds would be 2.1 billion Swiss francs ($1.9 billion) from 50.3 million new shares.

The subscription price for the hike is 42 francs per share, which is at a 28 percent discount to the closing price of 58.45 francs on Tuesday and compares with a 46 percent discount in world number 1 cement maker Lafarge's (LAFP.PA) rights issue earlier this year. [ID:nL8711576]

"We consider the transaction as a key strategic step," Vontobel analyst Serge Rotzer said in a note.

Holcim said financial stability was its priority, while HeidelbergCement said it would focus on cash flow generation. Both groups said they would continue to cut costs, with Holcim targeting savings of 375 million francs this year and HeidelbergCement looking to save 380 million euros.

Last month, Heidelberg won a $12 billion lifeline from creditor banks, giving the world's fourth-largest cement maker until the end of 2011 to sell assets and cut costs. [ID:nL8711576]

(Editing by Dan Lalor, Jon Loades-Carter, John Stonestreet)

($1 = 1.086 Swiss francs)

($1=.7154 Euro)