Displaying items by tag: LafargeHolcim Morocco

Morocco: Switzerland-based LafargeHolcim subsidiary LafargeHolcim Maroc has recorded a profit of Euro161m in 2019, up by 7.5% year-on-year from Euro149m in 2018. Its sales held steady at Euro744m. The company says that it ‘does not anticipate any significant change in market conditions’ in 2020. Its new Agadir-Souss grinding plant is scheduled to come online in 2020.

Morocco: LafargeHolcim Morocco’s net profit in the first half of 2019 was Euro90.6m, representing an increase of 8.6% year-on-year from Euro83.5m in the six months to 30 June 2018. Its revenue held steady year-on-year with a 0.2% increase to Euro366m from Euro365m. It continues its ambitious renewables plan with an 80% increase in its use of wind power.

HeidelbergCement’s Moroccan subsidiary Ciments du Maroc improved its net profit restated for exceptional items by 3.4% year-on-year to Euro55.3m from Euro53.6m in the first half of 2018. Its 2019 first-half revenue improved by 5.0% to Euro191m from Euro183m in the same period of 2018, which it said was due to a record year-on-year increase in clinker sales of 55% due to increased exports and operational improvements.

The agreement this week by Ciments du Maroc to buy two production projects from Anouar Invest Group marks a consolidation phase in the local market. The subsidiary of Germany’s HeidelbergCement has struck a deal to acquire Atlantic Cement’s 2.2Mt/yr integrated plant project in Settat province and the Les Cimenteries Marocaines du Sud (CIMSUD) 0.5Mt/yr grinding plant at Laâyoune, which was only recently commissioned.

Graph 1: Cement sales and production capacity in Morocco, 2013 - 2018. Source: L’Association Professionnelle des Cimentiers (APC) & Global Cement Directory 2019.

Graph 1 gives an impression of the market conditions the cement producers have faced over the past five years. Cement sales hit of a high of 16.1Mt in 2011 following increasing growth in the 1980s, 1990s and 2000s. Cement sales have since wilted, while production capacity has increased pushing down the capacity utilisation rate. The capacity utilisation dropped below 55% in 2018, using Global Cement Directory 2019 data, although other sources have placed it at around 60%.

Local production is dominated by two multinational producers, LafargeHolcim (LafargeHolcim Maroc) and HeidelbergCement (Ciments du Maroc), and a local company, Ciments de l’Atlas (CIMAT). CIMAT is owned by Addoha Group and it also operates Ciments de l'Afrique (CIMAF) with plants across West Africa. A fourth player, Asment de Témara, run by Votorantim, also operates an integrated plant.

LafargeHolcim Maroc’s turnover fell by 2% year-on-year to US$837m in 2018 along with a drop in consolidated net income of 18% to US$201m. It attributed this to lower sales and growing petcoke costs. Ciments du Maroc’s turnover fell slightly to US$419m but its net profit rose by 3% to US$108m. This followed a generally positive year in 2017 due to a strong second half of the year. It blamed the instability on a poor real estate market. CIMAT managed to raise its sales in 2018 by 6% to US$300m and its income by 1.4% to US$90.7m.

Anouar Invest Group’s decision to sell up may mean that its attempt to break into the cement market has failed. Who can blame it given the market conditions. Although, who knows, HeidelbergCement may have made it a great offer. HeidelbergCement’s gambit is also interesting because, in February 2019, it reduced its stake in Ciments du Maroc by 7.8% to 54.6% signalling less confidence in the country.

Yet, cement sales started to improve in the first quarter of 2019 with consecutive month-on-month improvements. Neither is Anouar Invest Group the last company to try its luck with cement production in Morocco. In June 2019 FLSmdith announced that TEKCIM had ordered a US$45m cement plant from it and Société Générale des Travaux du Maroc. The grinding unit has a production capacity of 1.2Mt/yr. Clearly, despite a market with production overcapacity, companies are sensing opportunities with the cement grinding model.

Morocco: China’s CBMI has signed a contract with LafargeHolcim to build a cement grinding plant near Agadir. The deal for the SSS 13 & 14 Grinding Plant EPC Contract was signed on 21 March 2018 at the LafargeHolcim Technology Centre in Lyon, France. Once operational the plant will be run by LafargeHolcim Maroc.

Morocco: LafargeHolcim has appointed George Michos as its new head of its Moroccan subsidiary. He succeeds Marcel Cobus, who moves to the LafargeHolcim executive committee in charge of the Europe region, according to Morocco World News. Previously Michos worked as the managing director of LafargeHolcim’s Heracles General Cement subsidiary in Greece.