September 2024
Dangote Cement revenue grows as volumes fall in 2017 21 March 2018
Nigeria: Dangote Cement’s sales revenue rose in 2017 but its sales volumes of cement fell. Its revenue rose by 31% year-on-year to US$2.23bn in 2017 from US$1.70bn in 2016. However, sales volumes of cement in Nigeria fell by 15.9% to 12.7Mt from 15.1Mt. Altogether, its sales volumes rose by 8.4% to 9.37Mt in the rest of Africa and fell by 7% to 21.9Mt in total. Its earnings before interest, taxation, depreciation and amortisation (EBITDA) rose by 50.9% to US$1.08bn from US$713m.
“Although Nigerian volumes were lower in 2017, our Pan-African operations increased volumes by 8.4% and now make up 42% of the Group’s total cement sales, demonstrating the robust diversification of our business,” said Joe Makoju, Acting Group Chief Executive Officer of Dangote Cement. He added that the cement producer had increased its footprint from eight countries to 10 during the reporting period with the opening of new facilities in the Republic of Congo and Sierra Leone, while its operations in Cameroon, Senegal and Ethiopia achieved ‘strong’ sales growth during the year.
Regionally, Dangote Cement said that its estimate for the total Nigerian cement market fell by 18% to 18.6Mt in 2017 due to a recession in the first half of the year and higher prices. It also noted that its Gboko plant in Benue State was mothballed for ‘most of the year.’ Elsewhere, it said that it exported 174,000t of cement from Nigeria to Ghana. In Senegal it introduced 32.5R cement to its product range. In Sierra Leone it opened a 0.5Mt/yr terminal and bagging plant in Freetown in early 2017. In Tanzania it said that its plant at Mtwara had lost earnings due to its reliance on temporary diesel generators. Gas turbines are scheduled to start operation in March 2018.
China: Dongwu Cement has forecast that its sales revenue will rise by 60% year-on-year to US$56.4m in 2017 from US$35.2m in 2016. It has attributed the boost to increased sales volumes and the price of cement, according to ET News. Its profit is forecast to more than double to US$10.7m from US$2.37m. The cement producer will release its full annual results later in March 2018.
Indocement opens 0.5Mt/yr terminal in Palembang 21 March 2018
Indonesia: Indocement has inaugurated a 0.5Mt/yr at Palembang in South Sumatra. The terminal has two cement silos and a packaging plant, according to Warta Ekonomi magazine. The new unit will allow the cement producer to sell bulk cement and it is expected to increase its presence in Sumatra.
Raysut Cement to consider building plant in Georgia 21 March 2018
Georgia: Oman’s Raysut Cement has approved an initial study to consider building a 1Mt/yr cement plant in Georgia. The company’s subsidiary Pioneer Cement Industries Georgia owns a limestone mine with reserves of over 30Mt about 60km from Tiblisi. A final decision on the project is expected to be made by June 2018. Discussions have also commenced with possible partners for both equity participation and engineering, procurement and construction (EPC) contracting.
Egypt: Egypt Petroleum Technology (EGYPTCO) has received bids from US, Canadian and Saudi Arabian companies to finance two oil well cement production projects with a value of US$500m. An agreement is expected to be reached by mid-2018, according to the Egypt News Daily newspaper. The company is seeking to reopen an existing cement production line and build a new plant to produce both specialist cement and additives.
Workers at Ciments Calcia’s Airvault plant go on strike 21 March 2018
France: Workers at Ciments Calcia’s Airvault cement plant have gone on strike, according to the Ouest-France newspaper. They have taken industrial action in relation to an on-going pay dispute.
Consultant alleges fraud at Binani Cement 21 March 2018
India: Vijaykumar Iyer, a resolution professional with Deloitte Touche Tohmatsu India working for Binani Cement, has alleged that fraudulent transactions have taken place involving the promoters of the company. Iyer made an application in mid-March 2018 to the National Company Law Tribunal (NCLT) in Kolkata asking the court to take action and ‘appoint an appropriate investigation agency to investigate the directors of Binani Cement and the counter parties,’ according to the Economic Times. Sources quoted by the newspaper say that the application is likely to receive a hearing imminently. Binani Cement has denied the allegations.
Iyer’s application said that he had appointed Haribhakti & Co as a ‘forensic consultant’ in November 2017 for reviewing and identifying ‘suspect’ transactions. He said that since the inception of the corporate insolvency resolution process, he had not been provided access to all the required information and documents. He alleges that Binani Cement made several payments to ‘potentially related and/or connected customers and entities,’ such as Saraswati Sales (SSPL) and US$75.4m was outstanding at the end of November 2017, suggesting that sales were made to SSPL despite the fact that corresponding payments were not made to the corporate debtor. Other inconsistencies were also found suggesting that money was being removed from the business without paying outstanding debts.
Dalmia Bharat beat UltraTech Cement in a bidding war to buy Binani Cement for US$974m in early March 2018 in an auction was run by the National Company Law Tribunal under insolvency proceedings. However, UltraTech Cement has since made a US$1.11bn bid directly to Binani Cement to stop the insolvency process. UltraTech Cement has said it is ‘shocked’ by the allegations by Iyer and that it was unaware of any pending investigations when it made its latest offer.
India: UltraTech Cement has made a new US$1.11bn bid directly to Binani Cement in order to buy it. Binani’s parent company Binani Industries is independently seeking to stop the insolvency proceedings of its cement subsidiary using the money offered by UltraTech Cement in a so called ‘comfort letter.’ In a statement UltraTech Cement said it had in principle agreed to buy 98.5% of the shares of Binani Cement.
However, a consortium led by Dalmia Bharat won an auction for Binani Cement with a bid of US$974m in early March 2018. The auction was run by the National Company Law Tribunal under insolvency proceedings. Binani Cement has since complained that the bidding process was not run on a transparent process, according to the Economic Times newspaper. It added that the ‘shortcomings’ in the insolvency process had prompted the company to look at other options. The on-going struggle by UltraTech Cement and Dalmia Bharat is expected to test local bankruptcy law.
India: The Central Pollution Control Board (CPCB) has issued a show cause notice to Parasakti Cement for processing hazardous waste like battery scrap and operating without permission. The CPCB also noted that the particulate matter emissions from clinker rollers and cement mill exceeded the revised standards, according to the Times of India newspaper. The cement plant, based at Guntur in Andhra Pradesh, has been given 15 days to remedy the situation. Previously in 2016 the company said it was complying with the emissions regulations.
Clinker ship sinks on river in Bangladesh 20 March 2018
Bangladesh: A cargo vessel carrying 1035t of clinker has sunk on the Rupsha River. Local police said that water started to enter the ship, MV-BB 134, whilst in the middle of the river when a crack opened in its hull, according to the United News of Bangladesh news agency. The vessel sank within an hour. No casualties have been reported.