Displaying items by tag: RHI Magnesita
RHI Magnesita appoints Jacqueline Knox as EVP General Legal Counsel & Company Secretary
31 October 2018Austria: RHI Magnesita has appointed Jacqueline Knox as EVP General Legal Counsel & Company Secretary. She will join the company on 1 December 2018 and will be part of its executive management team.
Knox was previously General Counsel and Company Secretary at Ophir Energy, a Financial Times Stock Exchange (FTSE) listed upstream oil and gas business with a large portfolio of assets across Africa and Asia, which she helped to take from a private company to a London listing. She holds a dual degree in law and international relations (BA/LLB) from the University of Queensland and is a dual British / Australian citizen.
UK: Refractory producer RHI Magnesita says that its cement and lime segment was ‘flat’ in the first half of 2018. It blamed this on on-going low capacity utilisation in China and Brazil and ‘some’ market share losses due to its prices. The adjusted sales revenue of its Industrial Division, including cement and lime, rose by 14.3% year-on-year to Euro413m in the first half of 2018 from Euro362m in the same period of 2017. Overall, the company reported a 24.6% increase in revenue to Euro1.51bn from Euro1.21bn.
In a separate release RHI Magnesita subsidiary Magnesita said that the company’s revenue rose by 81.6% to US$133m. This was attributed to sales to the cement business in North America and higher deliveries in Europe in 2018. However, Magnesita’s services business suffered from a poor cement market in Brazil.
RHI Magnesita to merge operations in India
01 August 2018India: RHI Magnesita plans to merge its three local subsidiaries, RHI India and RHI Clasil with Orient Refractories. On completion of the proposed merger RHI Magnesita will own about 70% in Orient Refractories which will be renamed RHI Magnesita India. The transaction is expected to be complete by mid-2019.
“The proposed merger of our Indian subsidiaries marks an important milestone towards expanding RHI Magnesita’s market leadership in the refractory market in India. One strong, integrated organisation and management will increase long term value for all stakeholders and efficiently combine resources and capabilities. This merger will significantly enhance the profile of RHI Magnesita in India and creates a stronger foundation to tap the immense growth potential we see in the Indian market,” said Stefan Borgas, chief executive officer (CEO) of RHI Magnesita.
Orient Refractories is currently 70% owned by RHI Magnesita. It is a manufacturer and supplier of special refractory products, systems and services for the steel industry. RHI India, a wholly-owned RHI Magnesita subsidiary, is the local sales company of RHI Magnesita group offering a range of refractories and related services sourced from various RHI Magnesita group entities to Indian customers. RHI Clasil is 53.7% owned by RHI Magnesita. It is a manufacturer and supplier of mainly alumina-based refractories for steel and cement.
This merger is part of RHI Magnesita’s strategic pillar ‘markets’ that focuses on building a global presence with strong local organisations and solid market positions. India’s growth prospects in the refractory market derive primarily from the steel sector, which is RHI Magnesita’s largest customer industry.
Once the merger is complete the new company will operate two production plants and employ over 700 workers. The proposal is subject to shareholder and regulator approval.
China: Austria’s RHI Magnesita plans to invest Euro20m in its dolomite plant in China. It is intended to address global pressures in the supply of raw materials to the refractory industry and ‘rapidly’ provide additional volumes to its customers worldwide. In the medium term more than 250 jobs will be created at the brick plant and raw material mine in Chizhou.
The Chizhou site includes an ‘extensive’ dolomite mine and raw material production as well as facilities for the production of high-quality dolomite-based finished products. Successful trials are already underway in the brick plant in Chizhou where it is planned to start production by the beginning of 2019. The raw dolomite mine is planned to resume operation by the end of 2019. This overall investment will eventually lead to the creation of up to 250 jobs.
“After the completion of the investment, RHI Magnesita will be able to offer a fully integrated dolomite source in each of the big regions of the world to our customers and simultaneously offer dual sourcing options,” said Stefan Borgas, the chief executive officer (CEO) of RHI Magnesita. He added that the investment will allow the company to offer its customers in Asia shorter lead times and provide additional capacity to customers in North America, Europe and Asia from local sources.
Borgas went on to say that stricter environmental regulations in China have led to local plant closures, resulting in shortages of both magnesite and dolomite, ‘dramatic’ increases in raw material cost and supply security issues. These developments have accelerated the shift from magnesia- to dolomite based products. High stainless steel production has further fuelled demand for refractory products and compounded the pressure on raw material supplies.
Votorantim shone a glimmer of hope for the Brazilian cement industry with the release of its first quarter financial results this week. Increased sales volumes in Brazil, Turkey, India and Latin America led to an 11% rise in revenue to US$682m in the period. Admittedly back home in Brazil, most of this came from concrete and mortar sales, but after the slump Brazil’s had they’ll take whatever they can get. This compares to a 14% drop in sales revenue in the same period in 2017 due to falling cement consumption.
Graph 1: Accumulated 12 months local cement sales in Brazil. Source: SNIC.
SNIC, Brazil's national cement industry association, preliminary figures for April 2018 show a similar trend. Cement sales for April 2018 rose by 8.9% year-on-year to 4.35Mt from 4Mt. Sales for the first four months of the year dipped slightly by 0.2% to 16.9Mt although this is an improvement on the first quarter figures showing the benefit a strong April has had. Improvements are driven by growth in the central and southern parts of the country. SNIC’s graph of accumulated sales (Graph 1) definitely shows a slowing trend of decreasing cement sales with April 2018 being the only the second month in over two years where sales have risen.
Paulo Camillo Penna, the president of SNIC, even went as far as to speculate that the three months from April to June 2018 might see the first sustained period of improvement since 2015 and that sales could even grow by 1% for the year as a whole. This is a far cry from Penna’s description of his industry at the start of 2017 as, “One of the worst moments in its history.”
Votorantim reported that some regions of Brazil were starting to show a positive trend in the second half of 2017. Unfortunately it wasn’t enough to stop the cement producer’s overall sales falling for the year. LafargeHolcim didn’t release specific figures for its Brazilian operations in 2017 but it did say that its cost savings programme had, ‘provided for material improvement versus prior year both in recurring earnings before interest, taxation, depreciation and amortisation (EBITDA) and cash flow.’ It reckoned that despite the market contracting, it had managed to increase its market share. Meanwhile, on the supplier side RHI Magnesita said in a first quarter trading update that its cement and lime business was flat due to continuing low capacity utilisation rates in China and Brazil.
If this truly is the end of the Brazilian cement market slump then it seems surprising that there haven’t been more mergers or acquisitions. Mineração Belocal, a subsidiary of Belgium’s Lhoist, said this week that it had purchased L-Imerys, a lime producer that operates a plant at Doresópolis in Minas Gerais. Local refractory producer Magnesita merged with RHI in mid-2017.
The big deal that hasn’t happened is the sale of InterCement, the country’s second largest cement producer. Owner Camargo Corrêa was reportedly selling minority stakes in the company in 2015. Then in early 2017 local press said that it was aiming for a price of US$6.5bn for the whole company with Mexico’s Cemex as a potential bidder. Since then nothing has happened publicly although the initial public offering of InterCement’s Argentine subsidiary Loma Negra in November 2017 for US$954m may have bought Camargo Corrêa the time it needed to wait for the market to improve. Rumours of a public listing of InterCement’s European and African operations have followed.
In its World Economic Outlook in April 2018 the IMF forecast a 2.8% rise in gross domestic product (GDP) in Brazil in 2018. If SNIC’s forecast for 2018 is correct then Camargo Corrêa may have survived the worst of the slump to live to trade another day. The price for InterCement at this point can only rise, as should the prospects of the Brazilian industry.
Belgium: Stefan Borgas, the chief executive officer (CEO) of RHI Magnesita, has started working as the new president of the World Refractories Association (WRA). He succeeds François Wanecq, the former CEO of Vesuvius.
The WRA was founded in 2014 by refractory industry associations and multinational companies. The WRA constitutes a forum to debate regulatory issues affecting global trade, circulate aggregated industry statistics, promote the interests of the worldwide refractory industry, and act as a counterpart to other world industry organizations such as the World Steel Association. The WRA is composed of continental associations including Europe (PRE), Latin America (ALAFAR) and North America (TRI) as well as national associations from China (ACRI), India (IRMA) and Japan (JRA). Multinational companies are also direct members.
RHI Magnesita starts trading on London Stock Exchange
31 October 2017UK: RHI Magnesita has started trading on the London Stock Exchange (LSE). It has been admitted to trading in the premium segment of the main market on the LSE. The start of trading on the exchange marks the completion of the merger process between RHI and Magnesita.
“After the successful combination, RHI Magnesita is now fully dedicated to the strategic repositioning as the global leader in the refractory industry. With our 14,000 employees, we can drive positive change in our industry and aim to offer our customers an even greater value proposition in the future,” said Herbert Cordt, chairman of the board of directors of RHI Magnesita,
Following the merger the new company leads the refractory industry. It holds 35 raw material and production plants and more than 70 sales offices around the world and its product portfolio comprises more than 120,000 individual refractory products. It also operates two main research and development centres in Leoben, Austria and Contagem, Brazil.
As part of the merger process the company has also unveiled a new brand and logo to represent its global presence, its innovation and its company mind-set. The new logo and the visual system based on it consist of a horizontal eight, the symbol of infinity, and the shapes of refractory bricks.
Europe: The closing date of the merger between refractory manufacturers RHI and Magnesita is expected to be 26 October 2017. This follows approval by the Dutch Authority for the Financial Markets (AFM) for the prospectus for admission to listing of RHI Magnesita shares on the Premium Listing segment of the Official List of the UK Financial Conduct Authority and to trading on the London Stock Exchange’s (LSE) Main Market for listed securities. The new company, RHI Magnesita, will start trading on the LSE on 27 October 2017.
RHI and Magnesita make sales ahead of merger
11 September 2017Europe: RHI and Magnesita have announced divestment agreements ahead of their proposed merger. RHI has signed a contract with a European refractories supplier for an undisclosed sum regarding the sale of its dolomite business in the European Economic Area. The sale consists of the production sites at Marone in Italy and Lugones in Spain. Magnesita has entered into a definitive agreement with Intocast to divest its business related to the production and supply of magnesia carbon bricks produced at the company's Oberhausen plant in Germany for Euro20.3m. Both sales were required by the European Commission as part of the merger process.
“With the sale of the two sites, the combination of RHI with Magnesita is also still right on schedule,” said RHI’s chief executive officer Stefan Borgas with regards to his company’s divestments “We expect the confirmation by the European Commission in the near future.”
RHI signed a contract in August 2017 to sell its production sites at San Vito in Italy and Sherbinska in Russia that produce fused cast refractories for the glass industry. Production at the company’s plant at Aken in Germany was stopped in the first half of 2017 for an indefinite period. RHI plans to sell or close the plant to maintain its production utilisation rate across the business.
Brazilian regulator clears Magnesita and RHI merger
12 July 2017Brazil: The Brazilian competition authority CADE has cleared the proposed merger between Brazil’s Magnesita and Austria’s RHI Group without restriction. This is the last major regulatory approval the merger process has required. RHI and Magnesita announced in October 2016 that were to merge to create a new refractory company called RHI Magnesita in 2017.