Displaying items by tag: Invasion

Ukraine/Italy: The Ukrainian National Agency for the Prevention of Corruption (NAPC) has placed Italy-based Buzzi Unicem on its list of Russian war sponsors. Ukrinform has reported that the NAPC accuses Buzzi Unicem of expanding its business in Russia since the country's invasion of Ukraine in February 2022, of supplying its products to Russian state-owned businesses including energy suppliers Rosatom and Rosneft, and of voicing support for the on-going invasion via its social media presence.

Between 2016 and 2021, Buzzi Unicem reportedly paid Euro62m-worth of taxes to Russia. In a statement, the NAPC said "For comparison, this is the cost of 206 Tochka U missiles." It concluded “Buzzi Unicem's continued business in Russia means direct support and sponsorship of terrorism by Russia.”

On 10 March 2023, Buzzi Unicem clarified that it has no business in Russia, calling the NAPC's listing 'defamatory.' The group explained that it has 'no involvement' in its Russian subsidiary SLK Cement's decision-making process related to local initiatives and commercial actions.

Buzzi Unicem said "Buzzi Unicem already clarified in its press release dated 12 May 2022 the decision to cease with immediate effect any operational involvement in the activities carried out by the subsidiary SLK Cement in Russia and to suspend all strategic initiatives and investments in the country." It defended the subsidiary, saying "SLK Cement is a Russian domiciled entity operating exclusively in that country and therefore subject to domestic legislation. Payment of taxes and having employees being mobilised to the army are not discretionary decisions, rather legal obligations within the Russian jurisdiction."

The group also voiced its support for Ukraine, saying "Despite significant financial losses incurred as a consequence of the Russian invasion, Buzzi Unicem did not stop operations in Ukraine, keeps supplying products to Ukrainian customers, paying taxes in Ukraine and providing job and humanitarian aid to its nearly 1000 employees and families in the country."

The English language release may be found here.

Denmark: FLSmidth's cement business recorded 29% year-on-year sales growth to US$2.14bn in 2022, from US$1.66bn in 2021. The business' earnings before interest, taxation and amortisation (EBITA) totaled US$28.9m, compared to negative earnings of US$2.7m in 2021. During the year, its Americas region contributed 34% of sales, its Europe, North Africa and Russia region (subsequently Europe and North Africa) 26%, its Sub-Saharan Africa, Middle East and South Asia region 25% and its Asia-Pacific region 15%. Overall, FLSmidth's sales rose by 24%, while its EBITA fell by 8%, year-on-year.

The supplier said "Overall, our cement service showed strong performance throughout the year. In some countries, we did however start to see the first cases of budget constraints imposed to counter the increasing energy costs."

Looking forward to 2023's anticipated result, it noted a 'healthy' order pipeline, but an anticipated slow-down in producers' decision making. This is due to concerns related to energy volatility continuing the wake of the outbreak of war in Ukraine. FLSmidth concluded "The short-term outlook for the cement industry remains impacted by overcapacity, and the potential recession is expected to impact market demand negatively over the coming period."

Ukraine: Ukrainian foreign investors’ fund UkrainInvest contributed US$20m towards the establishment of new grinding plants in Ukraine in 2022. Ukraine Business News has reported that the fund received 126,000 investments in 2022, up by a factor of six year-on-year. It added 11 projects worth US$2bn to its portfolio throughout the year, during which Russia launched its on-going invasion of Ukraine.

Vietnam: Vicem recorded full-year sales of US$1.68bn during 2022, up by 17% year-on-year. The producer sold 27.5Mt of cement, down by 6.7% year-on-year. Export sales volumes declined more sharply than those on the domestic market. Vicem responded to the cost impacts of economic disruptions arising from the on-going Russian invasion of Ukraine by raising its cement prices. Nonetheless, its profit fell by 30% year-on-year to US$63.9m.

Vietnam News Summary has reported that Vicem is aiming to achieve sales growth of 4% year-on-year in 2023, to US$1.74bn. Export sales growth prospects are strong, since China resumed its import of foreign goods at the end of December 2022. China consumed 54% of all Vietnamese cement exports in 2021.

Russia: The Ministry of Industry and Trade of the Russian government says that building materials are in high supply, but projected possible future shortages, beginning in 2024. The ministry named white cement as one product which it has adequately secured through new import sources. Russian construction remains dependent on imports, and the government says that it will look to further develop domestic production capacities of non-metallic materials from 2024.

Australia: James Hardie recorded sales of US$1bn in the first quarter of its 2023 financial year, up by 19% year-on-year from US$843m in the first quarter of its 2022 financial year. Its net profit was US$163m, up by 34% from US$121m. The group increased its North America fibre cement board sales by 28% to US$740m, its Asia Pacific fibre cement board sales by 9% to US$140m and its Europe building products sales by 7% to US$112. James Hardie launched its new European subsidiary James Hardie Fiber Cement Europe during the quarter.

James Hardie lowered its full-year adjusted net profit forecast to US$730 – 780m from US$740 – 820m. Interim chief executive officer Harold Wiens said "The current calendar year has seen the macro-economic environment change around us quite significantly, with unprecedented levels of inflation, global supply chain disruptions and a war in Europe. The current macro-economic environment is not only creating uncertainty for the housing markets in all three regions we do business in, but it is also putting pressure on our fiscal year 2023 financial results due to increased input and freight costs. That said, we are confident we will be able to deliver growth above market and strong returns in fiscal year 2023, and that is reflected in our updated guidance we provided today, which at its midpoint represents 22% growth in adjusted net income versus the prior year."

Philippines: Eagle Cement’s sales rose by 24% year-on-year to US$246m in the first half of its 2023 financial year from US$199m a year earlier. Its income was US$53.4m, down by 20% year-on-year from US$66.6m. Eagle Cement attributed the decline to cost impacts resulting from the Russian invasion of Ukraine and bottlenecks in global supply chains. Its operating expenses were US$26.1m, up by 35% year-on-year.

India: India imported 2.03Mt of coal from Russia in July 2022, making the widely sanctioned nation its third largest source of coal that month. The figure represents a 10% month-on-month increase from 1.85Mt-worth of Russian coal imports in June 2022. The Economic Times newspaper has reported that the single largest importer of thermal coal in July 2022 was UltraTech Cement, with 170,000t.

Italy: Buzzi Unicem recorded a net profit of Euro88.7m in the first half of 2022, down by 58% year-on-year from Euro210m in the first half of 2021. The group said that its recurring profitability worsened across its markets, with the exception of Russia. It also noted ‘substantial stability’ in the Czech Republic. Its consolidated sales, including those of its Brazilian and Mexican businesses, were US$2.41bn, up by 18% from US$2.05bn.

The group recorded cement sales volumes of 14.2Mt, down by 4.1% from 14.8Mt. Volumes fell by 27% in Eastern Europe and by 28% in Italy, but rose by 27% in Central Europe and by 8% in the US. Excluding Russia, the producer’s fuel costs per tonne of cement rose by 8.8% year-on-year to approximately Euro8.80, and its total energy costs rose by 20% year-on-year to Euro234m.

It implemented continued price rises across all markets except Mexico during the half, with the sharpest rises recorded in Italy and Ukraine.

Russia: Switzerland-based Holcim has written to multiple Russian government ministries to challenge a court ruling changing the benefactors of its Russian business. Local press has reported that the producer is subject to attempted assets raiding, with multiple anonymous submissions to the Russian Federal Tax Service requesting structural changes to its legal entities in Russia.

Holcim decided to leave the Russian market in March 2022 following the invasion of Ukraine.