Items filtered by date: Wednesday 01 March 2017
CRH to sell cement plants in Germany 01 March 2017
Germany: CRH has agreed to sell one integrated cement plant and one grinding plant in Germany to an unnamed party. These assets were purchased as part of a group of sites acquitted by CRH from LafargeHolcim in 2015. The transaction is subject to approval by the German Competition Authority (Bundeskartellamt). No exact value for the transaction has been released but the Irish building materials company has placed a sale including these assets and others including a clay business in Northern Europe and a concrete business in Belgium, the Netherlands and Luxembourg for Euro400m. CRH currently operates two integrated cement plants in Germany at Wössingen and Karsdorf.
CRH grows sales and profits in 2016 01 March 2017
Ireland: CRH’s sales revenue rose by 4% year-on-year to Euro27.1bn in 2016 from Euro23.6bn in 2015. Its earnings before interest, taxation, depreciation and amortisation (EBITDA) rose by 41% to Euro3.13bn from Euro2.22bn. The group attributed the growth in sales and profits to positive sales in the Americas and Europe and benefits from its first year of full ownership of some assets purchased from LafargeHolcim in 2015.
"2016 was a year of significant profit growth for CRH, with margins and returns ahead of last year in every division. We benefited from positive momentum in the Americas and also in Europe, particularly in the Northern and Eastern regions where we operate," said chief executive Alfred Manifold.
By region, the group’s Europe Heavyside division reported boosts in sales revenue and operating profits. However, its cement operations grew sales volumes in several countries where it faced price pressure and production overcapacity including Ireland, Spain and France. In Germany the group noted that sales volumes grew in its first full year of full ownership due to growth in residential building but that prices remained under pressure. Weak activity in Poland also affected pricing and reduced sales and operating profits.
Outside of Europe, the Americas Materials division also grew its sales and profits. Demand in North American cement markets increased as declines in Western Canada were offset by increases in Quebec and the US. In Brazil it reported that cement consumption fell by 12% in the southeast region and competition remained high. Finally, the group’s new Asia division said that cement demand grew in 2016 due to the private sector and government infrastructure spending. Its operating profit was also boosted by higher prices and lower input cost, including a lowered price of imported clinker. In China the group said that prices fell by due to a poor construction market and production overcapacity.
Nigeria: Dangote Cement’s earnings before interest, taxation, depreciation and amortisation (EBITDA) fell by 2% year-on-year to US$817m in 2016 from US$834m in 2015. However, its sales revenue rose by 25.1% to US$1.95bn from US$1.56bn and its sales volumes of cement rose by 25% to 23.6Mt from 18.9Mt. The cement producer reported a particular increase in sales volumes, revenue and earnings outside of Nigeria and it said that its export sales have turned Nigeria into a net exporter.
“We exported nearly 0.4Mt into neighbouring countries and in doing so, we achieved a great milestone by transforming Nigeria into a net exporter of cement. This is a remarkable achievement, given that only five years ago, Nigeria was one of the world’s largest importers, buying 5.1Mt of foreign cement at huge expense to our balance of payments. We will increase our exports substantially in 2017,” said chief executive officer Onne van der Weijde. He added that despite some local and temporary disruptions in Ethiopia and Tanzania, the cement producer strengthened its market share in every country. Operations are also due to start in the Republic of Congo and Sierra Leone in 2017.
By region, Nigeria’s economy entered into a recession in 2016. Dangote Cement increased its domestic sales volumes by 11.1% to 14.8Mt from 13.3Mt, although it said that its fourth quarter was hit by a price increase in September 2016. Despite the poor economic situation in the country it said that overall cement sales grew by 5.7% in 2016. Outside of Nigeria it increased its cement volumes by 54% to 8.64Mt from 5.61Mt, aided by the opening of a plant in Tanzania.
Tanzania: Sinoma will build a US$1bn cement plant in the coastal city of Tanga that is focused on exports. Prime Minister Kassim Majaliwa commended the plans following a meeting with representatives of Sinoma, Hengya Cement and local officials, according to the Xinhua News Agency. 70% of cement produced at the plant will be exported to local countries including Somalia, Kenya, Mozambique, Sudan, the Democratic Republic of Congo and Uganda. Construction at the site is expected to start in May 2017. The project will also include building a wharf to aid exports.
Loesche receives first order in Myanmar 01 March 2017
Myanmar: South Korea’s Yojin Construction & Engineering has placed an order for two cement mills from Loesche for installation in Myanmar. The order for a cement and slag mill is Loesche’s first in the country. The mills will be used at a grinding plant owned by Yojin Myanmar Engineering in Thilawa. They will each produce 75t/hr of cement with a fineness of 3300 Blaine. Operation is scheduled for mid-2017. Yojin is building its new grinding plant in the Thilawa Special Economic Zone south-east of Yangon. The site has an ambition to produce 1Mt/yr of cement.
India: The India Ratings and Research credit agency predicts that the cement industry will grow by 4 – 5% in the 2017 – 2018 financial year due to demand from infrastructure activities and a revival in housing demand in rural areas led by government spending. In a report it has revised downwards its growth estimates for the 2016 – 2017 period to 3 – 3.5% from 4 – 6% due to the negative effects of demonetisation. It added that, although the price of petcoke and coal has almost doubled since September 2016, it expects that stable cement demand will allow producers to pass these costs onto consumers in the 2017 – 2018 period.
Cement producers will add 50Mt/yr additional production capacity in the 2016 – 2018 period with the eastern region leading growth at 17Mt/yr followed by the north at 14Mt/yr. However, it fears that capacity increases in these regions may outpace demand. India Ratings said that the country’ cement production capacity utilisation rate was 70% in the 2015 – 2016 period and that it was likely to decrease to 65% following the effects of demonetisation. It is expected to rebound back to 70% in the next financial year.
Philippine cement sales rise by 6.6% to 26Mt in 2016 01 March 2017
Philippines: Cement sales rose by 6.6% year-on-year to 26Mt in 2016 from 24.4Mt in 2015 the Cement Manufacturers Association of the Philippines (CEMAP) has said. CEMAP president Ernesto Ordonez attributed the increase in sales to ‘continuing momentum for increased infrastructure,’ according to the Philippines Star newspaper. Despite this sales, volumes fell in the fourth quarter of the year. Ordonez blamed this on the run-up to the elections in 2016 and bad weather. Increased public and private infrastructure spending is expected to keep the local cement industry buoyant in 2017.
Tunisian government to sell stake in Carthage Cement 01 March 2017
Tunisia: Finance Minister Lamia Zribi has said that the Tunisian government has decided to sell its share in Carthage Cement. It owns an estimated 41% share of the cement producer, according to Tunis Afrique Presse. Zribi said that the decision was due to financial problems at the company as well as issues with production and export. Carthage Cement's chief executive Ibrahim Sanaa has blamed a rise in production costs on a poor construction market and production overcapacity.