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With a good number of the financial results published by the non-Chinese multinational cement producers for the first half of 2019, it is now time for a roundup. Graphs 1 and 2 below lay some of the basics with the general sales revenue and cement production volume trends.

Graph 1: Sales revenues from large multinational cement producers in the first half of 2019 and 2018. Source: Company reports.

Graph 2: Cement sales volumes from large multinational cement producers in first half of 2019 and 2018. Source: Company reports.

This is only part of the picture as the larger companies had various complications. For example, LafargeHolcim’s apparent falling revenue and sales volumes is mainly due to its massive divestments in South-East Asia. On a like-for-like basis its sales and sales volumes of cement rose. Its recurring earnings before interest, taxation, depreciation and amortisation (EBITDA) better illustrated this with a rise of 7.2% year-on-year in real-terms to Euro2.41bn in the first half of 2019 from Euro2.25bn from 2018. The company didn’t have it all its own way though with falling cement sales volumes in Asia despite the divestment and poor growth in its Middle East Africa region.

By contrast HeidelbergCement reported growing sales but its earnings and profits were down. Its profit fell by 33% to Euro291m from Euro435m. This was blamed on the group’s sale of its Ukraine subsidiary in April 2019. The operations were sold to Overin Limited, part of Ukrainian investment company Concorde Capital Group, for Euro13m. HeidelbergCement said that the divestment resulted in a loss of Euro143m. Aside from this, as Bernd Scheifele, the chairman of the managing board of HeidelbergCement, explained, positives in markets in Asia, Western and Southern Europe compensated for weaker business in North America and the Africa-Eastern Mediterranean Basin Group area.

Cemex has a tougher time of it than its larger rivals due its greater reliance on American markets. Slow starts to infrastructure projects were blamed in Mexico, poor weather hit earnings in the US and problems occurred further south too. Luckily Europe was strong for the company with lots of good news areas. It wasn’t enough though as Cemex’s sales fell by 4% to US$6.72bn from US$7bn and its operating EBITDA dropped by 11% to US$1.21bn from US$1.36bn.

As for the other companies covered in the graphs, Buzzi Unicem and Titan Group prospered due to the US market. The former described its US activity as ‘lively.’ However, it admitted that its sales growth there was mainly caused by falling imports in the face of weak domestic demand and ‘considerable production and logistical difficulties’ in June 2019 caused by flooding of the Mississippi river. Titan, meanwhile, caught a well-deserved break after recent years with growth also in Greece and Southeastern Europe. Vicat managed to stave off a decline in sales due to poor markets in Turkey, Switzerland, Indian and West Africa through its acquisition of Brazil’s Ciplan in late 2018. Yet, its earnings and cement sales volumes fell anyway.

Dangote Cement once again suffered at home in Nigeria, while its Pan Africa business grew. Trouble at home was pinned on lower volumes, price discounting, higher input and distribution costs and higher fuel and power costs in the first half of 2019. Of more concern, earnings fell in Pan Africa too in the first half due to market conditions in South Africa and Zambia. As ever though Dangote Cement’s diversity in Sub-Saharan Africa should see it through. Finally, Semen Indonesia continued to ride high as its sales increased by 23% to US$1.17bn due to its absorption of LafargeHolcim’s assets. Unsurprisingly, its sales volumes grew at a similar rate, to just below 13Mt in the first five months of 2019. Yet trouble may be store ahead as its local sales fell by 7% in this period.

Other major producers omitted here include Ireland’s CRH and India’s UltraTech Cement. Both are set to release their results later in August 2019 and will make for essential reading as the market conditions so far in 2019 become clearer. The latter in particular will be worth watching if a report by Indian credit agency CARE Ratings out this week is correct. It has forecast production capacity growth of 120Mt by 2030 in India. UltraTech Cement is perfectly poised to benefit from this.

Mexico: Cemex has made a series of changes its senior level organisation with changes to the heads of its operations in the US and its South, Central America and the Caribbean region. These personnel changes will come into effect from 1 September 2019.

Jaime Muguiro Dominguez, the current president of Cemex South, Central America and the Caribbean, and managing director and chief executive officer (CEO) of Cemex Latam Holdings (CLH), has been appointed president of Cemex USA. He succeeds Ignacio Madridejos who had held the role since late 2015. Madridejos will leave Cemex to become the CEO of Ferrovial, a Spanish infrastructure development company.

Jesus V Gonzalez Herrera, current Cemex Executive Vice President of Sustainability and Operations Development, has been appointed president of Cemex South, Central America and the Caribbean. In addition, on 6 August 2019, Gonzalez was appointed CEO of CLH by the board of directors of CLH.

Juan Romero Torres, currently the Executive Vice President of Global Commercial Development, has been appointed Executive Vice President of Sustainability, Commercial and Operations Development. This new role combines Romero’s current responsibilities with those of the Executive Vice Presidency of Sustainability and Operations Development, which include the Health & Safety, Operations and Technology, Energy, Procurement, Sustainability and Research & Development areas.

US: The Portland Cement Association (PCA) has made appointments to its executive teams in Government Affairs, Communications and Finance.

Sean O’Neill has been appointed as the Senior Vice President of Government Affairs. He joins the PCA from the Associated General Conwtractors of America as Vice President of Congressional Relations/Infrastructure Advancement. Previously he served as Director of Government Affairs at the International Association of Fire Fighters, Special Assistant to Secretary Elaine Chao and Chief of Staff for Congressman John Sweeney.

Nick Ferrari has been appointed Senior Vice President of Communications and Media Relations. He was previously Director of Publishing and Content Development at the American Society of Mechanical Engineers. He was also the chief executive officer (CEO) of Erdos and Morgan, a marketing and media research company and Executive Vice President at American Business Media. He has also held senior positions at Crain Communications.

Debra Adlis has been appointed as the chief financial officer (CFO). She will serve as treasurer and CFO for PCA, while also serving as Executive Vice President of Finance for the National Ready Mix Concrete Association. Adlis has led non-profit finance teams at the National Foundation for Credit Counseling, the Immune Deficiency Foundation and the Baltimore Symphony Orchestra. Previous to those roles Adlis worked with the National Hospice and Palliative Care Organization and the National Association of Real Estate Investment Trusts.

Austria: Alpacem has appointed Birgit Lautner as its head of human resources and Jerneja Potocnik as the head of its financial control. Lautner, aged 47 years, worked in various international finance and industrial companies in human resource roles before joining Alpacem. Potocnik, aged 41 years, will also act as finance director for Salonit Anhovo, the group’s Slovenian subsidiary. She has held various positions in the Wietersdorfer Group since 2016.

UK: Chris Leese has decided to leave Cemex UK after 30 years with the company. His varied career at Cemex has seen him taking responsibility for a broad range of activities, notably as Vice President of Readymix VP and more latterly as Vice President of Aggregates.

Leese has been a long-standing champion of health and safety improvements, taking a lead role at Cemex and the broader industry. He was the chair of the MPA Health and Safety committee for over nine years.

UK: Aggregate Industries has appointed Max Colligan as the managing director of its Ready Mix Concrete business and as a member of its executive committee. He holds over 30 years of experience in the construction industry. He holds a degree in civil engineering and has post-graduate qualifications in quarrying.

Trinidad & Tobago: The Caribbean Court of Justice (CCJ) has ruled that cement sold by Rock Hard Cement can be classified as ‘Other hydraulic cement.’ As such it is subject to a tariff of up to 5% under Common External Tariff (CET). Rock Hard Cement’s competitor Trinidad Cement and its subsidiaries had been arguing that the company’s products be classified as ‘Building cement (grey)’ and be charged a Caribbean Community (CARICOM) tax of 15% when imported into the region, according to the Barbados Today newspaper. The decision by the court is the latest in a series of legal cases between Rock Hard Cement and Trinidad Cement

However, the CCJ also said that recent developments in the cement industry made it appropriate for a study to be performed by the CARICOM Council for Trade and Economic Development (COTED) to assess whether the tariff rate for imported ‘Other hydraulic cement’ ought to be increased to give additional protection to regional cement manufacturers so that these manufacturers might obtain an appropriate level of protection. It also recommended greater collaboration between regional cement producers in undertaking global trade commitments.

India: JK Lakshmi Cement’s revenue rose by 9% year-on-year to US$160m in its first quarter to 30 June 2019 from US$147m in the same period in 2018. Notably, its expenses fell by 2% to US$146m due to decreasing logistics costs. Its net profit grew significantly to US$7.58m from US$0.44m. The cement producer also said that it had commissioned a 20MW captive power plant at its Durg cement plant in Chhattisgarh.

India: CARE Ratings has identified Telangana, Andhra Pradesh, Odisha, Rajasthan, West Bengal and Uttar Pradesh as the key states expected to lead cement production capacity additions over the next decade to 2030. In a sector report the credits agency forecast growth of 120Mt in this period. It noted that Rajasthan, Karnataka, Madhya Pradesh, Tamil Nadu, Andhra Pradesh and Telangana were among the top states in installed capacity at present. It said that the southern region led with highest installed capacity of 33% followed by the North, East, West and Central regions. Rajasthan, Karnataka, Telangana, Madhya Pradesh and Maharashtra are among the states with highest limestone resources.

India is the world’s second largest second producer but its per capita consumption is low, at 210kg. This is well below the global average of around 575kg/capita.

Saudi Arabia: Yanbu Cement’s sales revenue grew by 14% year-on-year to US$128m in the first half of 2019 from US$110m in the same period in 2018. Its net profit after Zakat and tax more than doubled to US$30.1m from US$12m. The cement producer attributed this to higher prices and growing clinker exports.