Displaying items by tag: Results

US: Eagle Materials reported sales of US$2.1bn in 2022, up by 15% year-on-year from 2021 levels. The producer's earnings before interest, taxation, depreciation and amortisation (EBITDA) rose by 19% to US$782m. Its cement sales rose by 7% to US$1.1bn due to increased prices, despite a drop in volumes. Throughout the year, the company increased its production of Portland limestone cement (PLC).

President and CEO Michael Haack said "Looking ahead, we anticipate continued attractive fundamentals in our markets, despite headwinds relating to higher interest rates and affordability constraints in single-family residential construction. Among the favourable demand factors we expect will affect our results in future periods are projected funding increases for infrastructure projects and healthy demand for heavy industrial projects and multi-family residential construction. We remain well-positioned to capitalise on these conditions, given our geographical footprint across the (Central) US Heartland and fast-growing Sun Belt (Southern US) and our financial strength and flexibility."

India: Ramco Cements' sales were US$987m during the 2023 financial year, up by 36% year-on-year from US$726m during the 2022 financial year. The producer sold 15Mt of cement and dry mortar products, up by 36%. The Times of India newspaper has reported that the producer's profit after tax declined by 62% to US$41.5m from US$108m.

The producer expects that anticipated infrastructure investments and a 'normal' monsoon will maintain strong cement demand in India in the full-year 2023 financial year. It forecast growth in its profit margins from the second quarter of the 2024 financial year (July - September 2023) onward.

Peru: Unacem recorded consolidated sales of US$380m during the first quarter of 2023, corresponding to year-on-year growth of 2.6%. Despite this, the producer's earnings before interest, taxation, depreciation and amortisation (EBITDA) fell by 7.4% to US$105m. Unacem attributed its sales growth to 'strong' cement sales volumes in the US, as well as increased prices across its markets. The domestic Peruvian market contributed US$247m (65%) of Unacem's sales, up by 0.5% year-on-year. Peruvian cement volumes fell by 8%, while high fuel costs there contributed to a local decline in earnings.

Looking ahead to the full 2023 financial year, Unacem CEO Pedro Lerner expects the group's consolidated sales to rise year-on-year. He forecast a 10% drop in Peruvian cement volumes to 6Mt. Lerner said that the company is 'monitoring events' in neighbouring Ecuador, but considers it inevitable that on-going political disturbances will 'affect economic conditions' in the market.

Trinidad & Tobago: Trinidad Cements' sales were US$309.6m in 2022, up by 9% year-on-year. Group earnings before interest, taxes, depreciation and amortisation (EBITDA) rose by 19% to US$77.0m. The Trinidad and Tobago Guardian newspaper has reported that the producer recorded a US$16.1m loss during the fourth quarter of the year. The producer attributed this to a weather-related drop in cement demand across its markets, as well as restructuring costs for its Barbados-based subsidiary Arawak Cement.

Trinidad Cement chair David Inglefield and managing director Francisco Aguilera Mendoza said "We will ensure that our operations remain resilient by continuing effective cost management initiatives to maximise value in this challenging economic environment. Additionally, we expect improved productivity and efficiency of our equipment on completion of major planned maintenance in 2023."

The two largest cement producers in Japan released their results for their 2023 financial years this week. Much like manufacturers elsewhere in the world they reported mounting sales revenues, but they also noted losses. Input prices such as coal rose in 2022 and these were passed on to consumers in the form of higher prices. However, this was insufficient to stop them making a loss.

In the case of Taiheiyo Cement, its domestic sales volumes of cement remained stable at 13.4Mt in the year to 31 March 2023. It made a loss at home in Japan but still reported a profit in its overseas businesses, despite export volumes falling by 41% year-on-year to 2.44Mt. The group also noted delays at construction sites due to a lack of workers. Recent domestic developments for Taiheiyo include an agreement in October 2022 to buy the cement business of chemicals company Denka. Outside of Japan, in China, the group suspended the production and sale of cement from its Jiangnan-Onoda Cement subsidiary in February 2023 citing a 'tougher competitive environment,' although it justified this decision as part of its strategy to refocus on Southeast Asia. Then, in late April 2023, the company was forced to stop its proposed acquisition of the Tehachapi cement plant in the US due to an inability to obtain regulatory approval.

Sumitomo Osaka reported a similar situation, with cement sales volumes also down year-on-year. Again, cement price increases were unable to catch coal prices made worse by negative currency exchange effects. Having got the bad news out of the way, it then it took the opportunity to outline its medium term strategy to 2035. It said that becoming carbon neutral was the key to this. In its 2022 financial year cement accounted for around 70% of total sales. However, it is now aiming to reduce this to 65% by 2025 and 50% by 2035. If this sounds familiar this is because it is similar to what Holcim is doing with its growing light building materials division and its diversification away from the heavy building materials trio of cement, concrete and aggregates. Sumitomo Osaka plans to invest over US$3.5bn towards this goal by developing its presence in the semiconductors sector, building its business in Australia and starting new ventures in decarbonisation.

Of the other cement producers, Tokuyama Corporation said in late April 2023 that it was considering suspending operation of one of the three kilns at its 4.54Mt/yr Nanyo cement plant as part of measures to strengthen profitability. It reported a growing loss for the current financial year that it blamed on raw material and fuel costs. Mitsubishi Materials and Ube Industries formed their merged cement businesses in April 2022 known as Mitsubishi UBE Cement Corporation. Ube said, as part of its latest financial results, that, despite a gradual decrease in the domestic market, cement sales had remained stable but that the business was “heavily affected” by rising energy prices such as coal. It added that demand for cement and concrete remain strong in its overseas market in North America.

Graph 1: Sales and exports of cement in Japan from 2013 – 2022. Source: Japan Cement Association.

The Japanese cement market peaked in the 1990s. Domestic sales of cement in Japan have declined over the last decade, as can be seen in Graph 1 above, but at a slower rate. Exports rose to a peak of just under 12Mt in 2017 but have slipped a little since then. Data from the Japan Cement Association placed production at 53.2Mt in 2022 compared to 61.7Mt in 2013. This trend explains the move by the cement producers towards decarbonisation, offshoring, diversification and consolidation. The bump in fuel prices over the past year may have accelerated this process, as examples such as Taiheiyo Cement’s takeover of Denka and Sumitomo Osaka’s new business strategy suggest. The race continues to keep cement production profitable in a changing business environment.

Philippines: San Miguel Corporation’s cement sales more than tripled year-on-year to US$183m during the first quarter of 2023, from US$57.1m during the first quarter of 2022. The group’s cement business contributed 3% of consolidated sales, compared to 1% in the first quarter of 2022. Overall, group sales rose by 9% to US$6.17bn, the Philippine Daily Inquirer newspaper has reported.

San Miguel Corporation completed its acquisition of Eagle Cement in December 2022.

Australia: James Hardie's sales were US$3.77bn during the 2023 financial year, up by 4% year-on-year from 2022 financial year levels. Its flagship North America fibre cement segment increased its sales by 9% to US$2.79bn, its Asia Pacific fibre cement segment increased its sales by 1% to US$527m and its Europe Building Products segment increased its sales by 3% to US$470m.

James Hardie's CEO, Aaron Erter, said “We delivered full-year adjusted net income and operating cash flows of US$606m and US$608m respectively. I am pleased with how the team adjusted during the 2023 financial year to prepare the company to thrive through this cycle. This is reflected in our strong fourth quarter results, including all three regions delivering significant earnings before interest and taxation (EBIT) margin improvement sequentially in the fourth quarter.”

Looking forward to the first quarter of the 2024 financial year, James Hardie forecast adjusted net income growth of between -6% and +6.9%, to US$145 - 165m, throughout the quarter.

Italy: Buzzi Unicem reported first-quarter sales of Euro956m in 2023, up by 20% year-on-year from Euro800m in the first quarter of 2022. The producer's cement volumes dropped by 8.8% to 5.8Mt from 6.36Mt. It attributed this to a general slowdown of the construction sector across its markets. Local low demand from the residential market and adverse weather compounded the regional sales contraction in Central Europe. On the other hand, the group recorded volumes growth in Mexico and Russia and stability in Brazil. Both Mexico and Brazil produced revenues growth, while Buzzi Unicem's revenues fell in Russia due to the effect of the appreciation of the ruble against the comparison period in 2022, when the start of the on-going Russian invasion of Ukraine devalued it.

Overall, the group expects to 'easily' match its 2022 full-year earnings before interest, taxation, depreciation and amortisation (EBITDA) in 2023. It said that that it could not currently delineate a 'clearly different picture,' but added "The stabilisation of energy prices, albeit at higher levels than in 2022, if confirmed, will allow us to have better visibility on the unfolding of the production costs from spring onwards."

Italy: Caltagirone Group subsidiary Cementir Holding reported year-on-year growth in sales of 15% to Euro415m during the first quarter of 2023. Its earnings before interest, taxation, depreciation and amortisation (EBITDA) rose by 34% to Euro81.2m. The group ended the period under review with a net debt of Euro32.1m, down by 64% year-on-year.

Cementir Holding said that its cement sales volumes rose in Türkiye, but failed to offset declines in its Nordic & Baltic, Belgium and US regions, resulting in an overall decline of 4%.

Brazil: Votorantim Cimentos recorded consolidated sales of US$1.18bn during the first quarter of 2023, corresponding to year-on-year growth of 18%. Its earnings before interest, taxation, depreciation and amortisation (EBITDA) also rose, by 85% to US$158m. Cement sales volumes fell in Brazil and Bolivia, but rose in Spain. The producer noted 'pressure' from high raw materials, freight and fuel costs in Brazil.

CEO Osvaldo Ayres Filho said "Price management implemented globally to face cost inflation contributed to the positive results in the quarter, despite the still volatile and uncertain scenario in the global economy. The company remains firm and aligned with its strategic plan, financially solid and prepared for the opportunities and challenges that lie ahead."