Displaying items by tag: GCW211
Lafarge brand unlikely to be changed after merger
27 July 2015Zimbabwe: Lafarge Cement Zimbabwe, which recently merged with Holcim, is considering retaining its Lafarge brand in the country, according to All Africa.
A Lafarge spokesperson could not clearly indicate how the merger would affect the local brand, but suggested that Zimbabwe could remain with the Lafarge brand with a LafargeHolcim endorsement, in comment with the Financial Gazette's Companies and Markets,
"There will be three different approaches to the branding of the new countries. In countries with a balanced overlap, including cement operations in Bangladesh, Brazil, Morocco, Russia, Spain and the US, as well as for the trading business of the new group, LafargeHolcim will be introduced as the corporate brand, while existing Holcim and Lafarge brands on the market will remain and be complemented by the endorsement, 'a member of LafargeHolcim'," said the spokesperson. "In other countries with overlap of activities including France, Indonesia, Malaysia and the Philippines, either Lafarge or Holcim will become a corporate brand receiving the endorsement. In the countries without overlap, the existing brand will remain at all levels, also with the group endorsement." Zimbabwe has no overlap as Holcim did not have a presence in the country.
Lafarge Africa appoints new CEO
27 July 2015Africa: Lafarge Africa has appointed Peter Hoddinott as the new group managing director / CEO. The former CEO, Guillaume Roux, will remain on the board as a director, according to the Kuwait News Agency
Hoddinott is a British mining engineer and started his business career in the mines of southern Africa before joining Blue Circle in 1988. Prior to this appointment, he worked as a lecturer in Imperial College of Science and Technology, London University in 1983 - 1988. While at Blue Circle, he worked in the Technical Centre and also managed the UK cement plants before going to the Philippines as CEO in 1999. When Lafarge took over Blue Circle, he stayed in Manila to integrate the two companies, leaving in 2003 to become regional president for Lafarge in Latin America. In 2007, Hoddinott became regional president for Western Europe (cement), including Morocco. In 2012, he became executive vice president (energy and strategic sourcing) responsible for worldwide energy strategy and sourcing of Lafarge's US$12bn/yr externally sourced inputs. Hoddinott was appointed group executive vice president (performance). He is currently president of Cembureau.
Pakistan/Iran: Pakistan's cement exports may drop by 10 – 15% at the start of 2016 as more Iranian cement will enter on the world market after sanctions have been lifted, according to Dawn.
Pakistani manufacturers will have to increase their export market destinations. However, local Pakistani cement industry officials believe that 'quality-conscious' countries like the UAE, India, Qatar and Sri Lanka may still prefer Pakistani cement as it is 'better' than its Iranian counterpart.
The officials are optimistic that the budget allocation for Public Sector Development Programme (PSDP) may play a positive role in incrasing domestic cement consumption and may dilute to some extent the negative impact posed by the anti-dumping duty in South Africa on Pakistani cement and influx of Iranian cement on the international market. Around 60 – 65% of Iran's cement exports go to Iraq, 10 – 15% to Afghanistan and the remaining to other countries including Pakistan.
The removal of sanctions is not expected to aggravate competition in Afghanistan, as it is only feasible for Iranian producers to target the Kandahar region closer to the border. The main market for Pakistani producers is Kabul and Jalalabad, where Iranian cement will not be competitive due to the higher transportation cost.
Iran is the fourth largest manufacturer of cement in the world with a capacity of around 80Mt/yr. This capacity is set to rise in the next two years. The country's cement production stands at 66Mt/yr, around 84% capacity utilisation, out of which 28% is exported.
Indonesia: Holcim Indonesia is ready to operate its new US$350m Tuban II plant at the end of 2015, according to Indonesia Finance Today.
Kent Carson, finance director of Holcim, said that in the last three years, the company has aggressively expanded production by building the new Tuban I and II cement plants with a total investment of US$850m. The new plants have 12.5Mt/yr of combined cement production capacity. Holcim Indonesia plans to boost market penetration into a number of areas in East Java and outside Java areas such as in Kalimantan.
Diah Sasanawati, corporate communications manager of Holcim, said that in anticipation of the weakening domestic demand for cement, Holcim plans to export to Vietnam, the Philippines, and Africa. In 2015, the company lowered its annual capital spending by 25% year-on-year to US$250m.
Pakistani cement producers oppose tax measures
27 July 2015Pakistan: Cement manufacturers have voiced their opposition to the various tax measures announced in the federal budget for 2015 - 2016 that they say will hurt investor sentiments in general and burden cement consumers in particular, according to The Express Tribune.
"Finance minister Ishaq Dar should revisit some fiscal measures that will lead to an increase in the cost of doing business and are against the norms of taxation," said Muhammad Ali Tabba, chairman of All Pakistan Cement Manufacturers Association. In a statement, Tabba pointed out that taxpayers with a taxable income of US$4.91m or more would be liable to pay a 3% super tax, which was discriminatory. The super tax would also be charged on export income, though exports were subject to the final tax regime at the rate of 1%.
Protesting against the increase in import duty from 1% to 5% on coal, Tabba said that while the cement manufacturers were making efforts to reduce the cost of production in order to compete at the global level, the duty hike would increase the business cost. Fuel constitutes more than 50% in the overall production cost and cement manufacturers will have no choice but to pass this additional burden on to consumers, he added.
Brazil: Votorantim Cimentos intends to temporarily suspend production at its cement plant in Ribeirao Grande, Sao Paulo from August 2015. The plant will operate as a distribution centre from this time. The decision has been blamed on current Brazilian financial climate.
A total of 128 workers are to lose their jobs, of which 83 have already been suspended, according to Valor Econômico. The company has also confirmed it is working with the workers union for the region to try to relocate the dismissed workers.
Cemex reports sales growth in 2015
23 July 2015Mexico: Cemex's consolidated net sales in the second quarter of 2015 grew by 5% year-on-year on a like-for-like basis for ongoing operations and adjusting for currency fluctuations to US$3.8bn. Its operating earnings before income, taxes, depreciation and amortisation (EBITDA) increased by 1% during the quarter to US$744m. On a like-for-like basis, operating EBITDA increased by 13%.
The increase in consolidated net sales on a like-for-like basis was due to higher product prices in local currency terms in most of its operations, as well as improved volumes in most of its products in Mexico, the US, and the northern Europe and Asia regions.
Cemex's net sales in Mexico decreased by 9% in the second quarter of 2015 to US$745m while its operating EBITDA increased by 4% to US$256m. In the US, its net sales grew by 5% year-on-year to US$1.01bn and its operating EBITDA increased by 31% to US$156m. In northern Europe, net sales for the second quarter of 2015 fell by 21% to US$904m and its operating EBITDA fell by 8% year-on-year to US$111m. In the Mediterranean region its net sales fell by 9% to US$409m as its Operating EBITDA fell by 25% to US$75m. Cemex's net sales from operations in South, Central America and the Caribbean fell by 8% year-on-year to US$517m and its operating EBITDA fell by 10% to US$160m. In Asia, net sales grew by 11% year-on-year to US$177m and operating EBITDA was up by 34% year-on-year to US$45m.
"We are pleased with our results. Our controlling interest net income during the quarter was the highest in six years. In addition, our operating EBITDA grew by 13% on a like-fir-like basis. This is the third quarter with double-digit, like-for-like growth in EBITDA," said Fernando A Gonzalez, Cemex CEO.
Peru: Cementos Pacasmayo has announced that, its consolidated earnings before income, taxes, depreciation and amortisation (EBITDA) increased by 6.4% to US$28m in the second quarter of 2015. Its net income rose by 8% to US$13.9m, but its revenues fell by 8.8%. The company said that its second quarter results were impacted by continued weakness in cement demand from the public sector. This led to a 9.4% reduction in cement sales volumes and also reduced its EBITDA, excluding US$2.76m of income from the sale of a real estate asset.
In the first six months of 2015, Cementos Pacasmayo's consolidated EBITDA increased by 8.4% to US$55.9m, its net income grew by 19.4% to US$30.3m and its revenues fell by 6%. Despite lower year-on-year cement volumes, its gross margin was 43.1%, up from 40.5% in the first half of 2014, thanks to an increased focus on efficiency and cost reductions.
Cementos Pacasmayo announced that its US$386m Piura plant had reached the final stage of construction, with cement production set to begin in the third quarter of 2015 and clinker production in the fourth quarter of 2015. The plant will reach 60% capacity by the end of 2015, a level which the company has established as the optimal capacity utilisation given the current conditions in the Peruvian cement market.
Looking ahead, independent forecasts point towards a recovery in Peruvian infrastructure spending. Local government spending improved slightly late in the second quarter of 2015, this trend is expected to continue through the second half of 2015, while the self-construction market is expected to remain at or near its current level. Cementos Pacasmayo expects its full-year cement volumes to be similar to those of 2014.
Emami Cement to build cement plant in West Bengal
23 July 2015India: Emami Cement plans to build a 1.5 – Mt/yr capacity cement plant in Panagarh, Bardhaman, West Bengal, according to the Palestine News Agency. The plan also includes a 10MW captive coal-fired power plant. Land has been allotted by the West Bengal Industrial Development Corporation (WBIDC). The estimated cost of the project is US$65.7m.