Displaying items by tag: Zimbabwe

Zimbabwe: Lafarge Cement Zimbabwe has reported a loss after tax of US$1.97m year-on-year in 2015. The company blamed it on a sub-optimal portfolio and price mix despite sales volumes growth. Its revenue grew by 2% to US$61.6m from US$60.5m and its cement sales volumes grew by 5%, according to the Herald newspaper.

The subsidiary of LafargeHolcim said that sales volumes were aided by its strategy of targeting distribution better supported by improvements in the local market. However, it added that sellers’ demand for discounts when buying in bulk have adversely affected cement prices. The cement producer expects prices to stay low in 2016 but it will aim for increased profits by cutting operational costs and increasing marketing.

Zimbabwe: Construction of the 0.7Mt/yr PPC Ruwa Plant in Msasa has been reported as more than half complete. PPC sources told the Financial Gazette that civil and structural construction of the cement plant is now more than 50% complete. The US$80m plant is expected to be running by the end of 2016.

Zimbabwe: Kelibone Masiyane has been appointed as the managing director of PPC Zimbabwe. He replaces Njombo Lekula, who recently became the managing director of PPC's international operations. Previous to the appointment, Masiyane’s was the general manager of the Colleen Bawn and the Bulawayo cement plants.

"Kelibone's promotion will see him assume overall responsibility for PPC Zimbabwe's business, with his key focus our Harare factory," said Lekula. Other recent promotions include those of Iain Sheasby and Karen Mhazo to the roles of Commercial Director and General Manager of Finance respectively, and that of current Group Human Resources Manager designate Trust Mabaya in March 2016.

South Africa: PPC has reported that its cement sales fell by 3% for its first trading that ran from October to December 2015. Cement sales in its South African business declined by 1.6% while its international businesses recorded an 8% decline, according to a trading update.

The South African cement producer reported that coastal regions in South Africa achieved positive volume growth. However this was offset by declines recorded in Gauteng and inland regions. During this period, average selling prices fell by 4%.

In Zimbabwe the completion of major infrastructure projects in Zimbabwe has led to declines of over 10% in local sales. Cement exports have also reduced due to exchange rate effects. In Botswana cement sales fell due to competition and weak demand. In Rwanda sales fell due to high rainfall and limited exports. However, the company's new 0.6Mt/yr cement plant was reported to be performing 'satisfactorily' and the kiln has passed its performance test for output and heat consumption.

Zimbabwe: Sino Zimbabwe Cement Company 42.5 grade Ordinary Portland cement for the construction of tall structures, bridges and roads in the first quarter of 2016.

The Gweru-based cement manufacturer, a joint venture between the Industrial Development Corporation and China Building Materials Corporation (CBMC), already has 22.5 grade masonry cement, which is recommended for masonry work, brick, mortar, plastering and general building and 32.5 grade portland composite cement, which is used for the construction of high strength structures.

Wang Yong, Managing Director of Sino Zimbabwe Cement Company, said that the company was now awaiting certification from the Standards Association of Zimbabwe (SAZ) before they could make the product available on the market. "We have already applied for the licence for us to introduce 42.5 grade cement on the market and I believe it will be issued after SAZ, which has already collected some samples, has certified the product," said Yong.

Zimbabwe: The Zimbabwe Investment Authority (ZIA) has issued Dangote Group with licences for three projects worth US$1.2bn, paving way for Aliko Dangote to start implementing business deals agreed with Government earlier in 2015. The three projects are a cement plant, a coal mining venture and an energy or power plant using coal off-take production.

Zimbabwe Investment Authority chairperson Nigel Chanakira said that construction of a cement plant would likely reduce the price of the commodity. "Without any shadow of doubt, from all indications this will be the largest plant, so it speaks to the dynamics in terms of competitive pricing in cement and the construction industry," said Chanakira. "Generally, housing building costs must come down."

He said that the ZIA wanted all licensed investors to start work immediately. "What we need now are very strong follow-ups to help anybody who has been licensed to make sure those licences are used and that they translate into real investment," said Chanakira. "In the past, we have been criticised that we approve projects and then people do not come. If you look at the trend, even in 2014, we have had the largest inflow in terms of foreign direct investment since 2006. In 2006 we had US$444m, in 2014 we reached US$545m. In 2015, the jury is still out. The year has not ended, but we are hoping that our numbers will go up to at least US$3bn."

Mozambique: Cimentos da Beira, the newest cement producer in Mozambique, plans to export some of its cement to neighbouring countries such as Zimbabwe and Malawi, in addition to supplying the domestic market, according to the Managing Director of the company, Wouter Trollip.

The plant, with an installed cement production capacity of 800,000t/yr, is expected to start operating later in October 2015, after tests of the substation that will supply electricity are complete. Trollip said that the plant already has 40,000t of clinker in stock in order to start cement production as soon as the power supply is guaranteed. With British and South African investment of US$45m, Cimentos da Beira employs 70 workers. Sofala Province now has three cement plants, including Cimentos de Moçambique and the recent Austral Ciment, an Austrian investment, both located in Dondo.

Zimbabwe/Africa: Aliko Dangote, President of Nigeria's Dangote Cement, has announced plans to open a US$400m cement plant in Zimbabwe. He also announced plans to invest in coal mining and power generation in the country.

"We've already decided to invest into Zimbabwe. That's why we are here," said Dangote following meetings with Zimbabwe's President Robert Mugabe and Vice President Emmerson Mnangagwa. "Any country we visit means, 'Yes, we've decided to invest,'" Dangote told journalists in Harare.

Construction is due to start in the first quarter of 2016, following the granting of government permission. Once constructed, the plant will produce 1.5Mt/yr of cement.

More widely, Dangote has also stated that investments in new plants across Africa are expected to increase the company's cement capacity to 100Mt/yr by 2020. Dangote said that Africa needs to increase its per capita consumption of cement in order to aid infrastructural development, stimulate further demand and force down rising cost of the commodity.

Zimbabwe: PPC is on track to commission its second cement plant in Zimbabwe in the second half of 2016. It is building its new 700,000t/yr plant at Msasa near Harare at a cost of US$80m. The plant is being built by China's Sinoma International Engineering.

PPC aims to generate 40% of its total revenue from outside South Africa by 2017, compared with about 28% now. Including its second Zimbabwe plant, PPC has four cement manufacturing plant projects in Africa. The other projects are in Rwanda, the Democratic Republic of Congo and Ethiopia.

Njombo Lekula, the managing director of PPC, said that the investment PPC was making in the Msasa plant was a vote of confidence in Zimbabwe's future and an expression of its commitment to build, grow and contribute meaningfully to the national economy while delivering on local imperative. "PPC Zimbabwe is looking to the future of the country, with today's event providing a promise of things to come. While our existing plant in Bulawayo has positioned us well in Matabeleland, it's clear that much of our country's future growth centres around Harare and northern Zimbabwe," said Lekula.

PPC is engaging with numerous local suppliers to leverage the scope of opportunities on this project beyond the main engineering, procurement and construction management (EPCM) agreement. "Because almost 70% of the total value of the EPCM is allocated to the supply of actual plant equipment, it was necessary for us to contract with a provider of the likes of Sinoma to ensure we create a world class plant in and for the region. Sinoma has contracted local labour as part of its workforce on the project, as well as meeting our non negotiable local supply requirements," said Lekula. He added that local contractors, including JR Goddard Construction, Ascon-Tencraft and HVC, had already worked on the project.

"As Zimbabwe's largest producer of ordinary Portland cement and the only producer of 42.5 cement, we are ideally positioned to play a leading role in developing the country's infrastructure. We have the equipment, processes and tanker fleet in place and are thus able to handle the bulk deliveries that are vital to these big projects. As such, we see ourselves as providing not just cement but a total solution to our customers," said Lekula.

Zimbabwe: PPC is under fire from local construction companies that have accused it of sidelining them in the construction of a new cement plant in Ruwa in favour of foreign companies, as reported by All Africa.

According to 'inside sources,' local companies submitted bids, but these were rejected due to a directive from the cement company's head office to sideline local companies and renegotiate a new contract with the main contractor, China's Sinoma International Engineering. The Chinese company was already undertaking construction works at the cement plant. Sources have said that since the beginning of construction, no projects have been awarded to local firms, which claim to have the same technical ability and expertise as the foreign companies.

"PPC is constructing a cement plant in Ruwa and is using only Chinese contractors to build the plant at the expense of local construction companies with the same capacity. Local companies submitted bids and none of them got a contract," said one unnamed source.

Another source said that a Chinese workforce drove the whole construction project being executed by Sinoma, which was against the Zimbabwe Agenda for Sustainable Socio- Economic Transformation Agenda's goal of creating jobs. "A number of local indigenous companies have tendered for various technical expertise, but none of them have been recognised. We believe that in order to empower local companies, there should be joint ventures between the foreign companies and locals to get a win-win scenario," said the source.

PPC managing director Njombo Lekula said that the company had engaged Sinoma on an engineering, procurement and construction management (EPCM) arrangement. He said that the EPCM was a common form of contracting arrangement for very large projects within the infrastructure, mining, resources and energy industries. "We engaged the Chinese in an EPCM arrangement and the contractor is the one that knows how to execute the project. Right now, Sinoma employs 60 locals, which I think is a large number. Due to the arrangement it is obvious that the contractor will provide for all the materials required, but we told them that we need a quarter of local supply as well. The claims are baseless considering that we contracted also JR Goddard construction to do our road and sewer reticulation works for US$700,000. So to say we are sidelining locals is unfounded," said Lekula. He added that the company would continue to empower local companies and suppliers. For example, an indigenous company has been awarded a contract to do all of the rail infrastructure at the plant at a contract value of about US$3m.

PPC expects to complete the construction of its 1Mt/yr capacity cement plant in the first half of 2016 with an investment of about US$86m having been made towards the project so far. The project would cost a total of US$200m after completion, with the investment package set to aid the setting up of another plant in Mashonaland Central. PPC is also building a separate grinding facility in Mozambique's Tete Province.