Displaying items by tag: Thailand
Laos: A leading Thai cement company, widely speculated to be Siam Cement Group (SCG), will co-invest with Lao-Phatthana Cement Industry Co, a unit of Souksomboon Group, in the construction of a US$330m cement plant in Khammouane, Laos.
Chaovalit Ekabut, SCG's chief financial officer and vice-president for finance and investment, declined to comment on whether the Thai cement producer is SCG, but said the group continued to explore opportunities in the Asean countries.
Chittakorn Souksomboon, president of Souksomboon Group, said that the Khammouane plant will have a clinker capacity of 1.6Mt/yr. The clinker will become 2.2Mt/yr of OPC and blended cement, with half serving the Laotian market and the rest exported to Thailand. The plant is due to be completed at the end of 2015 or early 2016.
"The possible Thai partner with 100 years of history is interested in jointly investing with us because we have a 50-year concession from the Laotian government to operate a limestone mine on 3875m2 nearby," said Souksomboon. The Souksomboon Group is keen to forge a partnership with a Thai cement firm because it wants to sell construction materials through a Thai hardware chain in the future.
Cement demand in Laos is forecast at 3.5Mt/yr, but supply is just 1.7Mt/yr. The landlocked country must import cement from China and Thailand. The Laotian economy is growing robustly with infrastructure projects such as roads, double-track rail and dams being developed ahead of the Asean single market comes into being in late 2015.
Souksomboon Group already runs a cement plant in Vientiane, Laos and is building a plant in Nakhon Phanom, Thailand, which is due to be completed in 2014.
Thailand: Thai TPI Polene Public Co. Ltd. has placed an order with Germany's Siemens for engineering and supply of the power distribution system and drives for a new clinker production line at its existing plant in Saraburi, Thailand. Siemens will supply the drive solutions as well as the switch-gear for the high, medium and low-voltage distribution systems and is also responsible for project management and engineering.
The deal for the drive systems covers 20 slip-ring rotor motors for the main drives, 12 gear units, 33 variable-speed drives for fans and two multiple drive systems for cooling units. Operation is due to commence in October 2014.
The Thai cement producer had earlier decided to add a fourth production line at the factory to boost production capacity in view of rising demand. The new line will have a capacity of 12,000t/day of clinker. Upon completion, the four cement production lines at TPI Polene in Thailand will have a combined capacity of 12Mt/yr. Siemens has already supplied the Thai TPI Polene Public Company Limited with electrical equipment for the three existing clinker production lines as well as for the cement and coal mills.
Italcementi expects weaker growth in Thailand for 2014
30 September 2013Thailand: Asia Cement, the Thai subsidiary of Italcementi Group, has projected slower growth in revenue in 2014 due to a likely weaker domestic market and uncertainty over the government's US$64bn infrastructure investment.
Co-managing director of Asia Cement, Nopadol Ramyarupa, said that Thailand's fourth-largest cement maker expects revenue growth of only 4% in 2014, according to the Bangkok Post. The company's revenue for 2013 is predicted to rise by 17.6% year-on-year to US$319m from US$271m in 2012.
"The economic slowdown and revised gross domestic product figures have affected our projection," said Nopadol, adding that growth in the overall cement industry is heavily tied to the country's economy and to the construction sector in particular. Co-managing director Roberto Callieri added that he hoped that the Thai government's US$64bn infrastructure investment would stimulate the construction sector sufficiently to meet Asia Cement's 'optimistic' growth projection of 4% over five years. Asia Cement has not been affected by labour shortages in the country or by an increase in the daily minimum wage to around US$9.50/day.
Asia Cement has a 14% share of Thailand's 33Mt/yr cement market. The company is operating at 80% of its combined annual capacity of 7.3Mt/yr its cement plants in Saraburi, Nakhon Sawan and Phetchaburi provinces.
Siam Cement Group reports robust Q2 earnings
07 August 2013Thailand: Siam Cement Group (SCG) has reported that its revenue rose by 10.5% year-on-year to US$412m for the three months ending on 30 June 2013 from US$373m. Net profit for the period rose by 10.3% to US$369m from US$334m.
Chief executive officer Kan Trakulhoon said that SCG will acquire a company that makes roofing products in Cambodia, Laos, Vietnam and the Philippines, extending a strategy of expansion in Southeast Asia to access rising incomes in countries neighbouring Thailand.
Thailand: German steel and engineering group ThyssenKrupp has won a Euro150m contract to build a cement plant in Saraburi near Bangkok for TPI Polene. The plant will have a cement production capacity of 10,000t/day and is scheduled to start production in 2015.
"With domestic cement demand expected to reach 45Mt/yr by 2015, Thailand is an important market and production location in Southeast Asia," commented ThyssenKrupp.
TPI Polene plans US$341m capacity expansion
27 March 2013Thailand: TPI Polene, Thailand's third-largest cement maker, plans to spend US$341m from 2013 to 2016 to develop a new production line at its Saraburi cement plant and to expand into renewable energy.
The project has been postponed since the financial crisis in 1997, said chief executive Prachai Leophairatana to the Bangkok Post. The fourth line will be developed at TPI Polene's existing plant in Saraburi province for US$194m. Production capacity will be raised by 33% to 12Mt/yr by 2026, making it the largest cement plant under one roof in the world.
"TPI Polene is the first Thai cement maker to invest in capacity expansion since 1997," said Prachai. "We saw cement demand gradually recover over the past few years. Additional demand will come from from the government's train projects over the next seven years."
TPI Polene has signed a memorandum of understanding to develop the project with Belgium firms P&V Project (Siemens), ALC Tournai, Atlas Copco and Magotteaux.
Thai cement exports from all producers are expected to come to 7Mt in 2013, down by 30% from 10Mt in 2012. TPI Polene aims to trim its exports to 700,000t in 2013 from 1Mt in 2012.
The company is also preparing to develop a 90MW unit fuelled by community waste, pending an environmental review. Around 60 MW from the new plant will be sold to the Electricity Generating Authority of Thailand, with the rest consumed in-house. The company also plans to generate additional revenue from the new power plant via sales of carbon credits under the Clean Development Mechanism concept.
New Indonesian plant for Siam Cement
28 February 2013Indonesia: Thai cement giant Siam Cement Group (SCG) will further expand its presence in Indonesia by building a new cement plant and acquiring more companies in the country, according to a company executive.
Chief finance officer Chaovalit Ekabut said that SCG expected to start the construction of a greenfield cement plant in Sukabumi, West Java with a total investment of US$356m."We expect to start construction this year and finish by 2015. We hope to commence operations at this cement plant in the second half of 2015," Chaovalit said on 27 February 2013.The cement plant will have a production capacity of 1.8Mt/yr.
Chaovalit added that SCG had decided to be careful and make small-scale investments in the cement market in Indonesia, which has grown rapidly on the back of increased housing demand and infrastructure projects.
"Some projections calculate that cement capacity (in Indonesia) may reach 100Mt/yr in another five to six years. This is very dangerous because you face a kind of bubble. When the demand seems to be very high, people build more and more plants and then everything stops and you end up having so much extra capacity," Chaovalit said."I hope we shall not fall into the same trap again. Companies should look at the market and continue to invest to serve the demand and not to overexploit something that is not real."
Siam Cement Q4 profit doubles
30 January 2013Thailand: Siam Cement has reported that it has more than doubled its quarterly net profit as Thailand rebuilt from floods and demand for construction materials and petrochemicals surged. Southeast Asia's second biggest cement maker posted a net profit of US$232m in the October 2012 to December 2012 period, a rise of 116% compared to US$107m in the same period in 2011. Revenue from sales rose by 14% to US$3.35bn.
"An increase of 116% year-on-year was largely due to the sales recovery of the construction-related businesses from floods in the fourth quarter of 2011," the company said in a statement.
Year-on-year increases in revenue and sales were more modest when compared to the previous quarter in 2012. Revenue fell by 4% compared to the July 2012 to September 2012 period and profit increased by 8%. Revenue for the company's cement sector rose by 36% to US$576m in the fourth quarter of 2012. Profit rose by 75% to US$71.1m.
In its statement Siam Cement reported that its export market sales volume dropped by 30% quarter-on-quarter to 1Mt due to seasonal factors and tight supply as a result of plant maintenance. On year-on-year basis, export volume decreased by 22% as a result of the conversion of exports volume to serve the domestic market. Earnings before interest, taxes, depreciation and amortisation (EBITDA) increased by 42% year-on-year due to the better domestic cement market but decreased by 12% quarter-on-quarter to US$117m due to plant maintenance and higher electricity costs.
Siam Cement is Southeast Asia's second largest cement maker with a cement production capacity of 24.2Mt/yr. It is 30% owned by the Thai Royal family's investment arm, the Crown Property Bureau. The company said future profit growth would be partly driven by construction across the developing Southeast Asian nations, where it aims to invest $6.7bn between 2013 and 2017.
Holcim’s Journey Continues
02 January 2013Just before the end of 2012 Holcim sold shares in companies it owned in Thailand and Guatemala. It reduced its stake in Siam City Cement Company (SCCC) in Thailand from 36.8% to 27.5% and it sold its entire 20% minority stake in Cementos Progreso in Guatemala. For the sale of these two share packages Holcim received approximately Euro310m.
This is interesting given that Asia-Pacific was the Switzerland-based multinational's biggest sales area in 2011 and because sales of cement rose by 6% in Latin America in 2011. Similarly in 2012 from January to September the two regions propped up the group's profits. Why would Holcim sell stakes into two of its most profitable regions?
In its third quarter report in 2012 Holcim repeatedly described Thailand as 'encouraging' following floods in 2011. It added that it had focused increasingly on the cement market in the country and strengthened its position in neighbouring countries that resulted in lower clinker exports.
According to the Global Cement Directory 2013 SCCC has a capacity of 31Mt/yr, 65% of Thailand's total capacity of 48Mt/yr. SCCC predicted in December 2012 that domestic cement demand would increase by 5-10% in 2013. The company is currently planning to build new plants in Indonesia and Cambodia and is considering investing in Myanmar. In Indoniesia Holcim is the third biggest producer after Semen Gresik and HeidelbergCement subsidiary Indocement.
Meanwhile in Central America, Cementos Progreso was the sole producer in Guatemala with 2.5Mt/yr from two plants. This was set to double with the commissioning of a third plant towards the end of 2012. However, Holcim retains seven plants in southern Mexico (12Mt/yr), both of El Salvador's plants (2Mt/yr) and a plant in Costa Rica (1Mt/yr).
With Holcim's strong presence in Central America and the North American market reviving leaving Guatemala makes sense with the group's debt reduction programme in mind. The situation in Thailand is more complex, so unsurprisingly Holcim has reduced its stake rather than leaving completely. SCCC's expansion plans outside of Thailand suggest, that although growing, the market is maturing. In one such potential expansion target, Indonesia, Holcim is already a major producer.
In its press release announcing the sales in Thailand and Guatemala, Holcim attributed the decision to its ongoing debt reduction programme. As part of its 'Leadership Journey' the group intends to save Euro1.25bn by the end of 2014. Other savings in 2012 included reducing management in Europe, layoffs and closures in Australia, a plant closure in Hungary, further delays on the decision to build a new plant in New Zealand and layoffs in Spain. The management changes in Europe alone contributed a Euro99m chunk of Holcim's target saving of Euro124m for 2012.
Yet it's worth considering that a week after the sales of its shares Holcim's subsidiary in India, Ambuja Cements, announced investments of Euro277m in India. Perhaps the best way to save money is to make more money.
Holcim sells stakes in Thailand and Guatemala
21 December 2012Thailand/Guatemala: Holcim Ltd has reduced its shareholding in Siam City Cement Company Ltd (SCCC) from 36.8% to 27.5%. The shares have been purchased by Bangkok Broadcasting and Television, a Ratanarak Group company, which will increase its shareholding in SCCC to 47%.
Elsewhere, Holcim has sold its 20% in Cementos Progreso SA to its majority shareholder, Grupo Cemcal SA Progreso, which owns a cement plant in San Miguel with an annual capacity of 3Mt/yr.
For the sale of these two share packages, which is part of the Holcim Leadership Journey, Holcim has received approximately US$410m.