September 2024
Germany: Pursuant to a sales agreement dated December 2019, Voith Group acquired a majority share in ELIN Motoren on 30 April 2020. Elin Motoren CEO Wolfgang Landler said, “ The future cooperation between the two companies will allow us to offer significant added value. Together we can develop system solutions and especially technologies in digitalisation. We are looking forward to the cooperation with Voith.”
Switzerland: LafargeHolcim has reported sales of Euro5.03bn in the first quarter of 2020, down by 11% year-on-year from Euro5.66bn in the corresponding period of 2019. Cement sales over the period fell by 10% year-on-year to 45.0Mt from 50.0Mt. The group’s earnings before interest and taxation (EBIT) was Euro249m, down by 14% from Euro290m.
LafargeHolcim CEO Jan Jenisch said that the results showed the group’s ‘resilience, despite the COVID-19 outbreak in China’ in January 2020. Other markets were disrupted from mid-March. “I am confident that LafargeHolcim will emerge from this pandemic as an important contributor to economic recovery as building activity gets back to normal,” he added.
LafargeHolcim’s coronavirus action plan consists of a Euro380m year-on-year capex reduction, a Euro285m year-on-year fixed cost reduction, realisation of energy price reductions, a review of all third party products and services and a reduction of net working capital in line with the level of activity.
Indonesia: China-based Sinoma International Engineering has completed the installation of a 10,000t/day integrated cement production line complete with raw material processing and clinker storage capacity at Gama Group subsidiary PT Cemindo Gemilang’s integrated Bayah II plant. China Daily News has reported that the Sinoma International Engineering Team worked overtime in order to complete the commission ahead of its scheduled date in May 2020. Project manager Wang Xiaojun said, “The COVID-19 outbreak had a severe impact on on-site construction.”
Tanzania: Turkey-based DAL Engineering Group has reported the successful delivery of three kiln shells to Germany-based HeidelbergCement subsidiary Tanzania Portland Cement’s integrated Wazo Hill cement plant near Dar Es Salaam. Tanzania Portland Cement produces the Twiga brand of cement across the 2.0Mt/yr plant’s three dry lines.
Suez Cement reduces management pay 30 April 2020
Egypt: Suez Cement, a HeidelbergCement subsidiary has implemented of a 20% reduction in pay for members of the management committee and a 30% reduction in pay for the managing director in the second quarter of 2020. The cuts are intended as a ‘cost-saving measure’ in line with the company’s aim to reduce expenses. Suez Cement said, “During the last few years the Egyptian cement industry has been going through very challenging times caused by oversupply and a sustained decrease in the demand, and Suez Cement Group has posted negative results. The COVID-19 crisis has complicated market conditions, affecting demand and increasing our costs. Moreover, it has affected our main shareholder, HeidelbergCement. In many countries it has suffered complete shutdowns and it is currently enduring complications in most of the countries that is present.”
Suez Cement continues to employ all staff.
Najran Cement takes out loan 30 April 2020
Saudi Arabia: Najran Cement Company has signed a financing agreement with Bank Al-Jazira for a loan of US$94.5m. Under the agreement, repayments are to be made at a rate of US$13.6m/yr for four years, and the remaining amount settled in the final year of the financing period ending 2025.
Australia: Mideco’s Bat Booth 2.0 personnel de-dusting booth has given producers an edge in tackling the spread of coronavirus amongst employees by detecting a sign of infection, namely a raised temperature (over 37.8°C). A medically-calibrated infra-red sensor in the Bat Booth 2.0 takes the user’s temperature in under half a second, informing them of the need to isolate. Mideco says that the booth’s low-pressure compressed air dust removal feature further reduces the contamination risk from an infected person’s clothing. Mideco said, “At a higher level, senior management can track trends and monitor the wellbeing of their staff remotely.”
Coronavirus effects on a cement supplier 29 April 2020
The headline from the cement section of FLSmidth’s first quarter results summed up what may be the current situation for many companies supplying the sector: “service relatively stable – cautious on capex.” The general picture across both its mining and cement businesses was ‘significantly’ increased demand for local resources, remote support and digital products. On the mining side FLSmidth pointed out that it was impossible to assess the impact of coronavirus on its business because of the difference between government policies. Some places continue lockdowns or impose additional restrictions but others are starting to ease them. This point has ramifications for multinational cement producers and other suppliers too. It seems likely to continue during the coming months as lockdowns ease at different rates in different countries.
On cement specifically, FLSmidth provided a good global view of what the pandemic and government responses are actually doing to the industry. It reports that around 80% of the world's cement plants (excluding China) are currently in operation with some operating at reduced capacity. It described the market for services as ‘relatively stable’ in the first quarter but that cement consumption was being reduced by lower construction activity, plant shutdowns and restricted access to sites leading to reduced demand for technical services and commissioning. By region it identified the biggest impact to its business from coronavirus in India and the Middle East. Generally, it says that cement producers are suspending capital investments until the impact of coronavirus on economies is clearer. There has been some good news though, with the supplier noting that several of its customers have been looking for services that can reduce their operational costs.
The European Commission tackled this pervading sense of uncertainty in its roadmap towards lifting coronavirus containment measures that was published on 15 April 2020. The Committee for European Construction Equipment (CECE) was keen to share this with its members this week, pointing out how the European Union (EU) plans to lift border controls and re-start economic activity.
The plan is to ease travel restrictions between border regions for cross-border and seasonal workers, and then between European areas with low coronavirus infection rates. External borders can later be reopened with access by non-EU residents to the EU scheduled for a second stage. To re-start economic activity the EU recommends, again, a phased approach focusing on sectors that are ‘essential’ to facilitate economic activity such as transport. The commission says it will also create a rapid alert function to identify supply and value chain disruptions, relying on existing networks such as Enterprise Europe Network (EEN), clusters, chambers of commerce and trade associations, small and medium enterprise (SME) envoys and more. Whether the EU can actually coordinate a return to normality following its poor response in aiding Italy at the start of the European outbreak of coronavirus remains to be seen. Yet, its historical roots as an economic community dating back to the Treaty of Rome in 1957 suggests it may be more successful when coordinating technical aspects of trade.
Detailed above are the views and plans of just one supplier and one continental organisation, although they are both prominent. The takeaway from this is that uncertainty is a major problem so far for the cement industry in the wake of the coronavirus outbreak. Companies have faced a cash crunch in the short term as economies slowed down and they are reluctant to release cash until the future becomes clearer. Large parts of the cement industry and its suppliers are very international, which exposes it to even more uncertainty. Different countries enforcing different restrictions and different easing strategies at different times create a major headache for everyone and a block to investment. Making cement is undeniably an essential industry and this realisation by legislators can be seen in some countries that at first shut down their plants before understanding that they needed them open after all! Suppliers should benefit from this too, although at reduced activity levels. We don’t know what kind of recovery will come – hopefully one releasing plenty of pent up demand. Yet one thing is certain. The work of the regional cement associations and those representing suppliers is going to be crucial in the coming months.
Yasser Elnaggar appointed as chairman of Suez Cement 29 April 2020
Egypt: Suez Cement has appointed Yasser Elnaggar as its chairman. He succeeds Hayrullah Hakan Gurdal in the role.
Elnaggar is the chief executive officer (CEO) of EN Investment, a management advisory and investment house. Previously he worked as CEO of the Chemical Industries Holding Company (CIHC), a conglomerate made up of 23 Egyptian companies. Alongside this he holds over 25 years experience as a diplomat for the Egyptian government with a notable posting in from 2010 to 2014 as the Deputy Chief of Mission of the Embassy of the Arab Republic of Egypt in Washington, DC. Domestic government roles he has held include working as the Principal Deputy Minister of Planning, Monitoring and Administrative Reform. In this position he helped oversee the implementation of Egypt's 2030 Vision strategy. He also held the post of Principal Deputy Minister of Investment until April 2016.
Thailand: Germany-based KHD Humboldt Wedag has reported the successful commissioning of a new Comflex grinding line at Siam City Cement’s Plant 1 in Saraburi. The line replaces two ball mill circuits, maintaining a production capacity of 350t/hr with a 40% lower energy consumption. The Comflex comprises a roller press, RPM18–200/180 static coarse material separator, VS620 static fine material separator, LS8600 system fan, HKSK 236/346 and four product separation cyclones. KHD says that Siam City Cement awarded it the engineering, procurement and construction (EPC) contract because of the system’s low specific power consumption of 13.36kWh/t, compared to over 21kWh/t in the previous system.