Displaying items by tag: Lafarge
Lafarge limps forward in Algeria
01 December 2011Algeria: Lafarge has agreed to undertake a project inherited from an acquisition of an Egyptian firm in 2007 according to an Algerian minister of state.
Responding to a parliamentary question in mid-November 2011, the Algerian Industry and Investment Promotion Minister, Mohammed Benmeradi, said that Lafarge had agreed to undertake the project as a minority partner, owning 49%, in accordance with a foreign ownership law passed in 2009. Lafarge originally inherited the project as part of its acquisition of the global cement interests of Egypt's Orascom Construction Industries (OCI). OCI had secured licences for a new plant at Oum El Bouaghi, in the east of the country, shortly before the Lafarge takeover was announced.
Benmeradi said that the Oum El Bouaghi project would cost US$500m and would take 12-16 months to complete. He said that Algeria is currently self-sufficient in cement, producing 17Mt/yr, of which 5.5Mt/yr comes from privately owned plants. The government has a huge capital spending programme, which points to a steady increase in demand for cement. Most of the state-owned plants are in a poor state of repair.
Lafarge explains activity at Ravena
24 November 2011US: Lafarge has reiterated that its expansion and modernisation plan at its Ravena plant in New York State is on track, hitting back at rumours from recently laid-off employees that the company had slowed down or even scrapped its plans to expand the site.
During a press tour of the site, Lafarge's environmental manager for North America, John Reagan, provided evidence that the project had moved to a pre-construction stage. The US$300m modernisation project underwent nearly three years of permitting with the Final Environmental Impact Statement granted in the summer of 2011. Contractors are dismantling structures at the adjacent Callanan Industry site, so that Lafarge has the room for expansion.
Reagan said that the final design and procurement of materials is ongoing with the construction phase planned from late 2011 to 2014, with start-up planned for mid-2014 and full operation planned for 2015. “2015 seems like a long time from now,” Reagan said, “But it’s not much time to complete all the work that has to be done.” Additionally, the senior project manager, John Light, spoke of the upcoming procurement of heavy equipment including new vertical roller mills.
Over the past few weeks several former Lafarge employees, some of whom were among the 39 laid off on 27 October 2011, have accused the company of everything from not intending to build the new plant to mismanagement. One has accused the company of doing just the bare minimum required to keep the permits valid before closing the plant when the permits expire.
Lafarge said that it plans to stay in Ravena and that the layoffs and the cut in production were related to the ailing US economy. The plant will soon go to a one-kiln operation, a 50% reduction in capacity. “Demand for cement will determine what capacity we run at,” said Reagan. “We anticipate, based on industry forecasts, that demand will not change much during the next two years."
France: Lafarge has announced a new organisation project, which aims to make the group more agile and responsive, focused on its markets and its clients and designed to accelerate the group's development and profitability.
The building materials giant, which has major interests in cement, concrete and aggregates, will replace its product line-based organisational structure with a country-based organisation. This will include the removal of a layer of management and the resulting reorganisation of the Executive Committee.
The project involves three main measures: to implement a country-based organisation, with country CEOs' responsibilities extended to cover all cement, aggregates and concrete activities; removal of one hierarchical layer, with the aim of cutting out the regional level; the resulting transformation of the structure and responsibilities of the Executive Committee, including the creation of 'Performance' and 'Innovation' functions.
The project was described by Lafarge as 'the natural next step' following its geographical expansion and its recent refocusing on cement, aggregates and concrete. This has become more pertinent following the disposal of most of its gypsum activities. Its aim is to increase Lafarge's differentiation through the development of higher value-added products and solutions for construction.
Bruno Lafont, Chairman and Chief Executive Officer of Lafarge, said, "This new organisation project will reinforce our efficiency. It will drive us to greater focus on our markets and customers' needs and to accelerate the group's development through organic growth and innovation. This transformation is a milestone for the group. It should strengthen Lafarge's position as a key player in sustainable construction." The project will be implemented from January 2012 onwards.
NGO demands suspension of forest officials over mining
14 November 2011India: Jaintia Youth Federation, a social organisation, has demanded the immediate suspension of forest officials who have declared forest areas as 'non-forest' land in the Jaintia Hills area of Meghalaya. The organisation expressed its fury that a large number of cement plants have been effectively allowed to mine limestone in forested areas. It also said that the state government should ask the eight cement companies in Jaintia Hills to contribute to compensatory afforestation.
"Officials who have declared such forests as non-forests need to be suspended and severe action needs to be taken against them as they have cheated and hoodwinked the government and helped the cement companies to function all these years," said the president of Jaintia Youth Federation, refering to a 1996 technical ruling.
Majaw added that similar action to that seen recently against Lafarge needed to be brought against all of the cement companies mining in the same area.
Lafarge third quarter sales up but reliant on emerging markets
04 November 2011France: Lafarge has released its financial results for the third quarter of 2011, which reveal an increasing reliance on emerging markets. Its sales were up by 1% in the third quarter to Euro4.21bn and were up by 6% in like-for-like sales. Its current operating income was down by 9% to Euro750m, a 7% drop like-for-like. The group's net income was down by 10% to Euro336m.
For the first nine months of 2011, its sales are up by 2% compared to 2010 (up by 4% like-for-like) and its current operating income was down by 12% to Euro1.64bn. Its net income fell by 22% to Euro596m.
Sales in Lafarge's cement sector increased by 1% in the quarter (up by 5% like-for-like) and increased by 2% for the year-to-date (up by 3% like-for-like), reflecting volume improvements in emerging markets partially offset by the negative impact of foreign exchange. Its cement volumes increased by 6% in the quarter (up by 5% like-for-like) and by 7% for the year-to-date (up by 5% like-for-like), with growth driven by emerging markets. Pricing moved marginally higher in the third quarter versus 2010 while slightly down on a year-to-date basis. Despite the group's cost reduction programme, higher cost inflation and foreign exchange weighed on results and margins.
The group achieved Euro50m of structural cost savings in the third quarter and Euro150m for the year-to-date, on pace with its Euro200m full-year target. Lafarge also announced a new cost savings programme of Euro500m for 2012. The group made the strategic decision to divest its gypsum activities in the early part of the quarter. In total, Lafarge has secured over Euro2bn of divestment proceeds for 2011 for debt reduction.
Bruno Lafont, Chairman and Chief Executive Officer of Lafarge, said, "In the current economic environment, the group continues to be proactive and already secured over Euro2bn of divestments as part of its actions to reduce debt. These efforts will continue and today the Group is announcing a new Euro500m cost reduction programme. These measures, including price actions in response to a high cost environment, are part of ongoing steps to strengthen profitability, reduce debt and maintain strong liquidity."
"Looking ahead, the fundamentals of our business are strong. The group, fully focused on its core businesses, foresees sustainable cash-generating growth led by high quality positions, a unique exposure to emerging markets and the advantages created by innovative products and solutions."
Overall, Lafarge continues to see cement demand moving higher and maintains its estimate of market growth of 2-5% in 2011 compared to 2010. Emerging markets continue to be the main driver of demand and growth and Lafarge benefits from its well balanced geographic spread of high quality assets.
AfriSam settles over cartel claims
02 November 2011South Africa: The South African Competition Commission has reached a settlement agreement with AfriSam, which has admitted that it took part in a cement cartel.
AfriSam has agreed to pay a penalty of USD16m representing 3% of its 2010 cement annual turnover in the Southern African Customs Union (comprising South Africa, Botswana, Lesotho, Swaziland and Namibia). This settlement is a reflection of AfriSam's material cooperation with the Commission in uncovering and providing further information on its conduct.
"This settlement is a reflection of AfriSam's material co-operation with the commission in uncovering and providing further information on the conduct," the commission commented on 1 November 2011.
This agreement follows the Commission's investigation of price fixing and market allocation against four main domestic producers Pretoria Portland Cement Company Limited (PPC), Lafarge Industries South Africa (Lafarge), AfriSam Consortium Ltd and Natal Portland Cement Cimpor (NPC-Cimpor). Previously, PPC applied for leniency and confirmed the existence of a cartel among the four cement producers. In terms of the settlement, AfriSam admits that it entered into agreements and arrangements with PPC, Lafarge and NPC to divide markets and indirectly fix the price of cement. The case against Lafarge and NPC continues.
"To facilitate this process we conducted a systematic and comprehensive review of some of the company's business practices from a competition law perspective," Stephan Olivier, AfriSam CEO stated. "We are, of course, saddened and embarrassed by what has happened. I say categorically that the AfriSam of today is an honourable and ethical company, fully committed to rigorous compliance with competition law."
Holcim grows capacity in Ecuador
27 September 2011Ecuador: Holcim expects to increase production capacity at its plant in the capital Guayaquil by 54% by 2012. The company will spend USD120m on expansion work and new machinery to boost cement production to 5.4Mt/yr from 3.5Mt/yr.
The machinery includes a new mill with production capacity of 250t/hr. The company is also building two warehouses for clinker and cement storage. The expansion project is currently 85% complete and will be ready to operate by the start of 2012.
Holcim decided to carry out the project based on the steady growth of public and private infrastructure projects in the country during the last few years, according to administrative manager Giancarlo Muñz. Current demand for cement in Ecuador is around 5Mt/yr, which is supplied by Holcim, Lafarge, Guapá and Cementos Chimborazo.
Cement production up in Romania in first half
26 September 2011Romania: Cement production in Romania were up by 8.1% year-on-year in the first half of 2011 to 3.18Mt. Domestic cement sales increased by 2.4% to 2.95Mt according to data released by the Romanian Association of Cement Producers (CIROM). Romania's cement market is dominated by the local units of Lafarge, Holcim and HeidelbergCement.
Hunger-strikers at French cement plant
21 September 2011France: Twelve Lafarge employees have gone on hunger-strike to oppose the closure of the company's plant in Frangey, Haute-Savoie, France. The French cement giant took the decision to close the site by April 2013 in May 2011 and the trade union CGT fears that Lafarge wants to close another five cement units in the future.
Lafarge to reconnect sidings to North Kent mainline
21 September 2011UK: Lafarge Cement's vision for the future is starting to take shape at the company's former cement works at Northfleet in Kent, UK, where it is conducting a major investment to reconnect rail freight facilities to the main north Kent line. Lafarge expects the rail sidings to be operational by mid February 2012.
The first main user of the restored line will be the cross-London rail project, Crossrail, which will transport excavated material from a tunnel bore near Paddington, London by train to Northfleet for onward transportation by ship.
Balfour Beatty Rail is carrying out all the design and construction of the new sidings and connection to the main line, whilst Chunnel Group has carried out the siding preparation works within the main site. The overall length of the rail link is around 2.25km and in total 4.75km of new track will be provided.
The 104-acre site is undergoing redevelopment by Lafarge in association with the Councils of Kent and Gravesham. The linkage of the site to the main line represents another important step in the regeneration of Northfleet embankment.