Displaying items by tag: LafargeHolcim
Holcim Russia launches Saratov upgrade
14 August 2017Russia: LafargeHolcim’s local subsidiary Holcim Russia has launched an upgrade at its cement plant in Saratov Region at a total cost of US$300m. The project to build a new dry process line began in 2012 and has increased the plant’s capacity to 4500t/day. According to local press the plant meets all modern standards and environmental safety requirements. It is expected that the line will be at full capacity by the end of 2017.
Canada: An agreement has been struck between Lafarge Canada and Metro Vancouver in which Lafarge Canada will use the solids removed during drinking water production by the municipality as an alternative raw material in cement production.
The residuals are the solids removed during the drinking water filtration process and consist of natural sediment and elements from the source water as well as coagulants and polymers from the treatment process. Between them, they have a chemical composition similar to that of red shale, one of Lafarge Canada’s raw materials. This means that the residiuals need not be landfilled and that less virgin red shale must be removed from the ground. The contract is for a minimum of 10,000t/yr.
“We are proud to have this partnership with local government and industry,” said Pascal Bouchard, the plant manager of the Richmond cement plant, which will use the residuals. “These residuals will soon be part of our city landscape, reused as an ingredient in concrete that is used in construction, from sidewalks to skyscrapers. I am hopeful that the research we have undertaken will allow other municipalities to consider industrial re-use options for their water treatment residuals.”
“We are very excited to be working with Lafarge on this innovative project, which uses residuals as a product, while reducing our overall environmental impact,” said Darrell Mussatto, Chair of Metro Vancouver’s Utilities Committee. “Our goal is to recover valuable resources from our utilities, and this project aligns perfectly with what we are hoping to achieve.”
Philippine Competition Commission expects to complete investigation of cement industry by 2019
03 August 2017Philippines: The Philippine Competition Commission (PCC) expects to complete an investigation in alleged violations of competitive practice by the cement industry by 2019. PCC commissioner Stella Quimbo made the comments at a forum on the Philippines Competition Act (PCA), according to the Philippines Star newspaper. The investigation follows a probe earlier in 2017 in which the commission says it found reasonable grounds to proceed based on allegations made by the former trade undersecretary Victorio Dimagiba. According to a legal statement made by Dimagiba, the Cement Manufacturers Association of the Philippines (CEMAP), led by its president Ernesto Ordonez, Lafarge Holcim Philippines and Republic Cement and Building Materials violated the provisions of the PCA by engaging in anti-competitive agreements.
Half year multinational cement producer roundup
02 August 2017Cement sales volumes are down at the larger multinational cement producers so far in 2017. As the first half-year results emerge, a picture seems to be appearing of sluggish growth at best for the major internationals. Reduced working days and poor weather have been blamed for the underwhelming performance.
Graph 1: Cement sales volumes for selected multinational cement producers during the first half of 2017. Source: Company financial reports.
True, LafargeHolcim’s sales rose by 0.4% year-on-year on a like-for-like basis, probably due to the assets the group has been sloughing off since the merger, but this is hardly the dynamic growth shareholders may have hoped for. Meanwhile, HeidelbergCement, following its acquisition of Italcementi in late 2016, has only been able to increase its cement and clinker sales by 1% for the first half of 2017 once consolidation effects were excluded. Here the problem appears to be reduced sales in both the US and Indonesia at the same time. This then leaves Cemex with a 2% drop in sales volumes to 33.9Mt with a big drop in the US despite a promising construction market otherwise. It blamed the decline on a high comparison base in 2016 and the weather.
The larger regional players examined here appear to have fared better. Both UltraTech Cement in India and Dangote in sub-Saharan Africa reported flat or falling sales volumes. However, delve a little deeper and there’s more going on. UltraTech didn’t offer any reason for the decline although it was likely focused on its acquisition of assets from Jaiprakash Associates and the knock-on from the demonetisation process last year. That purchase increased its cement production capacity by nearly 40% to 91.4Mt/yr from 66.3Mt/yr and it seems keen, to investors at least, that it will be able to rocket up the capacity utilisation rate at the new plants.
Dangote meanwhile has taken a blow from the poor economic situation in Nigeria, where it still produces most of its cement. Here, sales fell by 21.8% to 6.86Mt from 8.77Mt, causing its overall sales to fall by 11.3% to 11.5Mt. Almost incredibly though, as Graph 2 shows, Dangote upped its sales revenue by a whopping 41.2% to US$1.13bn off the back of improved efficiencies and a much better fuel mix in Nigeria. The turnaround is impressive considering the pressure the company faced in 2016. Today’s news that the firm has sold a 2.3% stake to foreign investors adds to the impression of a company on the move.
Graph 2: Sales revenue for selected multinational cement producers during the first half of 2017. Source: Company financial reports.
Looking at overall sales revenue shows a happier picture for most of the producers detailed here, with the exception of HeidelbergCement. Although Graph 2 shows declines for LafargeHolcim and Cemex on a like-for-like basis, at least growth is occurring. HeidelbergCement though has reported static revenue on an adjusted basis for the period. This suggests that the producer has hit problems just as it is starting to integrate the Italcementi assets into its portfolio. In theory the geographic spread of its new production units should shield it from lowered growth elsewhere but if this doesn’t happen it may be in for a rougher ride than LafargeHolcim following its merger.
In summary, being a large-scale multinational cement producer doesn’t quite seem to be offering the balanced growth one might expect so far in 2017. Cement sales volumes are slipping and revenue is also down on a direct comparison basis. It’s barely a case for comparison but smaller regionally based producers like UltraTech Cement and Dangote, in the right locations, seem to be capitalising on their positions. We’ll see how the big Brazilian producers Votorantim and InterCement, Buzzi Unicem and CRH fit this trend when they release their financial results over the next few weeks.
Brazil: LafargeHolcim has launched a marketing campaign for its Cimento Montes Claros cement brand in six states and the Federal District. The campaign is intended to increase brand recognition and improve its relationship with customers in Minas Gerais, Pernabuco, Bahia, Paraiba, Rio Grande do Notre, Goias and the Federal District, according to the Sags website. The campaign includes television and radio coverage, advertising on transport networks and social media spots. The campaign is planned to run until December 2017.
Philippines: Holcim Philippines is set to invest US$54m over the next two years to expand capacity and brace for ‘cut-throat’ competition that it says has affected is profitability. In the first six months of 2017, Holcim Philippines’ net profit fell by 42.6% year-on-year to US$41.5m on the back of a 16.7% decline in net sales to US$344.2m. For the second quarter alone, its net profit slumped by 46.2% year-on-year to US$22.9m. The decline in income was attributed by the company to lower sales alongside higher production input costs. Nonetheless, the company said that it would continue to invest to raise its cement production capacity from 10Mt/yr to 12Mt/yr to support demand as the government rolls out its flagship infrastructure projects.
In a statement Holcim Philippines president and chief executive Sapna Sood said that the investment indicated the company's continued commitment to the development of the country and its customers. "Our investments ensure that Holcim Philippines will continue to provide a reliable supply of an essential building material as cement demand increases in the country as these projects come on stream," she said. "The company will invest US$54m in the next two years to add 2Mt/yr to its current cement capacity by the first half of 2019, particularly in La Union and Davao."
Spain: Sergio Martínez Hernández has been appointed as the new director of LafargeHolcim’s Carboneras cement plant in Almería. Martínez Hernández holds over 24 years of experience in the cement industry, according to Teleprensa. He joined Holcim in 1993 after training as an engineer at the Escuela Técnica Superior de Ingenieros Industriales (ETSII) in Madrid. During his career he has worked at plants in Gádor in Almería, Yepes in Toledo and Portland in Colorado, USA.
LafargeHolcim beats expectations so far in 2017
26 July 2017Switzerland: LafargeHolcim has released its results for the second quarter and first half of 2017. Its net sales were up by 3.6% on a like-for-like basis in the quarter and its operating earnings before interest, tax, depreciation and amortisation (EBITDA) increased by 10.1% on a like-for-like basis, driven by pricing, cost discipline and synergies.
During the second quarter the group saw net sales of Euro6.16bn and an operating EBITDA of Euro1.6bn. Its net income rose to Euro707.6m, a rise of 38% from the same period in 2016 when it made Euro512.2m.
In the first half of 2017 LafargeHolcim’s net sales were Euro11.2bn, a 4.4% like-for-like improvement compared to the first half of 2016. Its operating EBITDA was Euro2.28bn and its recurring net income was Euro611.9m, a rise of 39% compared to Euro440.3m.
Beat Hess, Chairman and interim CEO said, "LafargeHolcim delivered positive earnings growth for the fifth consecutive quarter supported by favourable pricing, cost discipline and synergies. The unique strengths of our balanced portfolio are once again evident in our results with key countries such as the US, India, Nigeria and, notably this quarter, Mexico making significant contributions to earnings, more than offsetting headwinds in some of our markets. On that basis, and with our performance to date, we remain confident that we will achieve our full year guidance and our 2018 targets.”
LafargeHolcim Spain obtains ISO 9001 certification
20 July 2017Spain: LafargeHolcim Spain has obtained the International Standards organisation (ISO) UNE-EN ISO 9001:2015 certification for its cement plants. It says it is the first cement company to do so in the country one year ahead of an adaption period granted by the ISO. The standard provides a quality management system for companies and organisations to ensure that their products and services comply with external standards.
The subsidiary of LafargeHolcim’s Central Quality Laboratory has also revalidated its ISO 17025 status with the Entidad Nacional de Acreditación (ENAC), the national body that applies European accrediation standards.
LafargeHolcim to dissolve Holcim Nigeria
19 July 2017Nigeria: LafargeHolcim plans to dissolve its subsidiary Holcim Nigeria. The cement producer will present the final accounts of Holcim Nigeria as part of a voluntary winding up process at a meeting of shareholders in late August 2017, according to Reuters. LafargeHolcim will take on the shares of the unit when it closes. Holcim Nigeria became a part of Lafarge Africa following the merger of Lafarge and Holcim in 2015 and it originally owned a stake in the United Cement Company of Nigeria (UNICEM) along with Lafarge.