Displaying items by tag: FLSmidth

Saudi Arabia: Arabian Cement has placed an order with Denmark-based FLSmidth for the supply of equipment for an upgrade of its Rabigh cement plant. The order includes new DDX top cyclones, a quenching chamber and an ABC Cooler Inlet. Installation and commissioning is expected to be during the fourth quarter of 2021.

Arabian Cement’s chief executive officer Badr Osama Johar said, “With FLSmidth having provided the original line, they were the obvious candidate for the upgrade - we wanted a trusted partner who knows the ins and outs of the plant and is able to secure the success of the upgrade.” The producer previously engaged the company for the supply of its Rabigh plant’s kiln in 2008.

Norway: Norcem, part of Germany-based HeidelbergCement, has awarded a contract to Denmark-based FLSmidth to provide modifications to allow for downstream CO₂ removal at its integrated Brevik cement plant. The supplier will begin work in the unit’s winter 2022 shutdown. Its upcoming carbon capture and storage (CCS) installation is scheduled for commissioning in September 2024.

Norcem project manager Tor Gautestad said, “We are very excited to have FLSmidth on board and to finally begin the construction of the full-size installation.” He added, “FLSmidth’s extensive process knowledge, and air pollution control in particular, will be critical to the success of the project.”

Senegal: China-based Sinoma Group subsidiary CBMI Construction has awarded a contract to Denmark-based FLSmidth for the supply of three control systems for one new and two existing lines at the Kirène cement plant in Thiès region. The lines will share a digital infrastructure built on the FLSmidth ECS/ControlCenter platform with ECS/PlantDataManagement software. Additionally, the supplier will equip the new Line 3 with its ECS/CemScanner and QCX/BlendExpert. It said that the setup will use 12,000 data points on Line 3 alone.

Group digital general manager Jens Adler said, “With more than 1500 active product and process control installations in the cement industry, this order reaffirms our strong digital expertise.” He added “Digitalisation is transforming how many in the cement industry respond to increasing demands for emission reductions and efficiency. This is reflected in the emphasis on digital solutions as part of our MissionZero ambition to offer cement producers zero emission cement production by 2030.”

Denmark: FLSmidth says that it has allocated performance shares to 160 executive managers and key staff under its Long-Term Incentive programme. The shares have a three-year vesting period and are subject to fulfilment of stretched targets. Applicable targets are earnings before interest, taxation and amortisation (EBITA) margin, total shareholder return and MissionZero emissions reduction programme performance. The supplier estimated the cost of the plan as Euro6.98m assuming full vesting.

The company said, “The primary purpose of the programme is to retain key staff and to align the interests of shareholders and the incentive programme participants by rewarding performance in accordance with the company’s strategy.”

Kazakhstan: Denmark-based FLSmidth has announced the opening of its new ‘Service Supercenter’ in Karagandy, Qaraghandy region. The service centre has a focus on mining, but will also serve cement customers with equipment delivery, component maintenance and rapid on-site service backed by local support. The centre consists of a 2500m² warehouse and 1200m² workshop, as well as a customer service office, customer training centre and other support facilities.

Mining president Mikko Keto said, “The main concept of the Supercenter is to get closer to our mining and cement customers across Kazakhstan and Central Asia and support them with the best solutions, fast access to spare and wear parts, and, of course, local knowhow and expertise. This move supports FLSmidth’s ever-growing focus on customer service and aftermarket.”

US: Phoenix Industrial will install the raw mill for Denmark-based FLSmidth’s raw mill upgrade of CalPortland’s integrated Mojave cement plant in California. The company said that it will conduct civil, concrete, structural steel, mechanical and electrical work on the project. Mobilisation of crews to the site is due to begin in March 2021 with commissioning scheduled for December 2021. Saxum Engineering is also working on the upgrade.

Denmark: FLSmidth’s group net sales fell by 20% year-on-year to Euro2.21bn in 2020 from Euro2.78bn in 2019. Its earnings before interest, taxation, depreciation and amortisation (EBITDA) before special non-recurring items fell by 44% to Euro152m from Euro270m. Net profit was Euro27.6m, down by 74% from Euro104m.

The group’s cement business recorded net sales of Euro783m, down by 31% from Euro1.14bn, and an EBITA loss of Euro15.9m, compared to a gain of Euro65.3m in 2019. It said that the cement business is not expected to be EBITA positive in 2021 due to continued cement reshaping costs. However, order intake for the cement division improved year-on-year in the fourth quarter of 2020 due to a Euro101m engineering, procurement and supervision contract for a cement plant project in Ethiopia.

Chair Vagn Ove Sørensen and chief executive officer Thomas Schulz said, “The cement market is faced with on-going overcapacity and we see no short-term to medium-term recovery. Thus, we continue activities to reshape our cement business. Large economic stimulus programmes, combined with an increasing focus on lower-carbon cement, will create good opportunities in the medium- to long-term but the timing and extent of an overall rebound in the cement market remain uncertain. It is, however, clear that the cement industry will need substantial investments to meet the emissions reduction targets set by a growing number of cement producers as well as the recent commitments to carbon neutrality made by the Global Cement and Concrete Association (GCCA) and the European Cement Association. Based on the need to decarbonise, we foresee a multi-commodity cement industry in the future, utilising a range of cement production processes and a variety of raw materials. As the industry’s leading and most innovative premium supplier with strong process know-how, we are strongly positioned to benefit from this development.”

In further comments about cement industry trends the company noted that, “Following the shutdown of about 20% of the world’s cement plants outside of China in April 2020, the share of cement plants in operation has since climbed back up above 95% at year-end. However, many plants continue to run at reduced capacity and sites remain difficult to access due to restrictions and preventative measurements taken by authorities and plant operators.”

Turkey: Denmark-based FLSmidth has won a contract to provide a grey-to-white cement line conversion at Çimko Çimento’s cement plant in Adiyaman. The company will supply equipment suited to the production of white cement including its DuoFlex burner, rotary cooler and OK raw mill. It said that it will begin work in 2021 and the producer will commission the renovated line in early 2022.

The supplier said, “Once completed, the upgraded line will offer Çimko Çimento new opportunities to expand its product range and enter new markets. White cement is especially sought-after in countries with relatively hot climates, as it tends to keep buildings cooler with its reflective characteristics. In addition, as a high-quality, value-added product, white cement is often used in the construction of innovative buildings and important landmarks. FLSmidth brings significant experience and know-how to the project, having conducted several similar grey-to-white conversions in recent years, including projects with Turkey-based Adana Cement and Eskisehir Cement, as well as Alsafwa Cement Company and Riyadh Cement Company in Saudi Arabia.”

There have been two developments from ThyssenKrupp’s ongoing restructuring worth noting by the cement sector in recent weeks. The first is that the Germany-based engineering and steel producer has stopped trying to sell its cement plant division. The second is that Denmark-based FLSmidth is holding serious talks about buying its mining division.

ThyssenKrupp first announced plans for a major restructuring in mid-2019 with an anticipated reduction of 6000 jobs across the business. The sale of its elevator business for Euro17.2bn to private equity was announced in February 2020. Later in May 2020 it then revealed plans to divide its previous business areas into core, dual and multi track segments. Core - including Materials Services, Industrial Components (Forged Technologies and Bearings) and Automotive Technology – would be kept as before. Dual-track – including Steel and Marine – would either be kept as before or considered for consolidation. Multi-track - including cement plant engineering, mining and more – would be sold, added to a partnership or closed. By size, core reported sales of Euro16.1bn (53%) in the company’s 2019 - 2020 financial year, dual-track reported Euro8.8bn (29%) and multi-track reported Euro5.5bn (18%).

Volkmar Dinstuhl, formerly in charge of mergers and acquisitions, was put in charge of Multi-track. By October 2020 he was publicly admitting that the division was planning to “find a solution for all our businesses within the next two years” including cement plant engineering. In the same interview he described the Multi-track division as an internal private equity fund. However, the elevator business sale has been seen by several commentators as giving ThyssenKrupp more freedom around how to conduct its restructuring. Three months later and Handelsblatt, a German business newspaper, reported this week that ThyssenKrupp’s cement plant division may have avoided its multi-track fate. It cited internal communication to employees about what’s been happening with the sale. Principally, orders have picked up in the company’s new financial year, since October 2020, and although a sale has not been ruled out, it won’t be pursued until late 2021 at the earliest. This is potentially good news for the sector as a sign that the market may be improving and definitely good news for those employees working for the division.

As a competitor, FLSmidth would have been expected to be potentially interested in buying either ThyssenKrupp’s mining or cement plant division, or both. So, the only question was, when it made a point of saying publicly that it was in non-binding negotiations to buy mining, what about cement?

Looking at the numbers shows that FLSmidth’s mining division did better than its cement one in the first nine months of 2020 with order take up year-on-year and the mining industry described as being relatively resilient during the coronavirus crisis, with the majority of mines operational across regions. By contrast it pointed out that the cement market was still ‘severely’ impacted by the coronavirus pandemic and that future cement demand was dependent on general economic growth. Acquisition activity in mining certainly seems like the safer bet at the moment. Yet the temptation to neutralise a competitor may have been a strong one. With the mining deal still in progress and the cement sale possibly ended for now, we’ll just have to wait and see. Other buyers for both divisions are no doubt waiting in the wings should circumstances allow.

One final fun fact to consider is that the man put in charge of selling both of ThyssenKrupp’s mining and cement plant divisions, Volkmar Dinstuhl, just happens to be a World Chess Federation (FIDE) recognised International Master. Being good at chess doesn’t automatically confer skill at anything else. Just look at former world champion Gary Kasparov’s political ambitions in Russia for example. Yet, ThyssenKrupp’s elevator division sale has been seen as one of the largest leveraged European buyouts in recent years and has appeared to have bought it some time to mull its options over its cement plant division. With this in mind, any potential buyers for the rest of Multi-track may be wondering just how many moves ahead this seller is thinking.

Germany: Denmark-based FLSmidth has entered into non-binding negotiations with ThyssenKrupp over the possible acquisition of its mining business. Mining is one of ThyssenKrupp subsidiary ThyssenKrupp Industrial Solutions’ major businesses, alongside cement. This business segment reported net sales of Euro2.9bn in its 2020 financial year, a small decline from the sales figure in 2019 despite the coronavirus pandemic.