Displaying items by tag: economy

Austria: RHI Magnesita reported revenues of Euro3.3bn throughout 2022, up by 30% year-on-year from 2021 levels. The refractories supplier's raw materials and shipping costs rose, but it was able to offset the rise by increasing its prices. The company said that this generated Euro600m in additional revenues, enabling it to maintain profitability 'through a challenging economic cycle.' It noted global volatility and uncertainty, which it expects to continue into 2023, for which it forecast a full-year drop in global cement demand. It expects 'strong growth' in India to offset any resulting decline in its sales in other markets.

RHI Magnesita CEO Stefan Borgas said "I am pleased to report growing progress on our mergers and acquisitions strategy, with acquisitions in India, China, Türkiye and Europe agreed or completed during the year. Whilst the outlook for 2023 is more uncertain than prior years due to slowing demand for refractories and softer pricing in certain regions, RHI Magnesita is able to face these challenges in a much stronger condition as a result of the implementation of its strategic cost savings and sales strategies over the past four years."

Pakistan: Lucky Cement recorded sales of US$876m in the first half of its 2023 financial year, up by 42% year-on-year from US$616m in the first half of the 2022 financial year. It sold 3.57Mt of cement and clinker, down by 24% year-on-year from 4.7Mt. The producer's costs rose by 50% to US$585m from US$391m. It recorded a profit of US$73.1m, up by 6.8% from US$68.4m.

During the half-year period, total national cement sales dropped by 17% year-on-year to 20Mt, while Pakistan's cement exports fell by 49% to 1.7Mt. The aftermath of flooding, high interest rates, inflation and cost of goods and cuts to government spending all impacted the domestic cement market, while 'global recessionary trends' cut into exports, according to Lucky Cement.

Lucky Cement holds a 15% share in the Pakistan market and a 34% share in the export market.

China: China Resources Cement (CRC) recorded a 74 - 78% year-on-year net profit drop in 2022. As such, its full-year net profit was US$255 - 302m. Reuters has reported that the group attributed the drop to subdued demand from construction, increased production costs and low cement and clinker prices in the regions where it operates.

Despite the slow situation in the construction market, CRC's property development arm recorded a rise in its rental income throughout 2022.

India: The state government of Himachal Pradesh has issued a show cause notice to Adani Cement subsidiaries ACC and Ambuja Cements. The notice requires the producers to submit grounds for the government not to pursue 'appropriate administrative action' against the companies over the planned closures of their respective 4.4Mt/yr Gagal and 1.6Mt/yr Darlaghat cement plants. The administration says that it is prepared to take such action as is necessary to 'safeguard lives and livelihoods' across the various sectors impacted by the move.

The regional government said, "It is indeed alarming that you have not taken the state government or its functionaries into confidence before taking such a major decision involving the lives and livelihoods of so many stakeholders. Moreover, you have not even tried to approach or exhaust various forums, avenues, or channels available with the state machinery in order to resolve whatever concerns, grievances or issues that they might have."

The state of Himachal Pradesh owns the land on which the Gagal and Darlaghat cement plants are built and the associated limestone reserves.

South Korea: The government ordered 2500 cement truck drivers to return to work on 29 November 2022. The Korea Herald newspaper has reported that drivers in the sector who continue their strike will be subject to criminal sanctions of up to three years in prison or a US$22,600 fine, and will have their truck driving licences suspended. The government explained that the order is justified due to cement truck drivers' failure to present 'good cause' for the industrial action.

President Yoon Suk-Yeol said "Taking the livelihoods of ordinary people and the national economy hostage to look out for their own needs is not justifiable."

Cement truck drivers make up 35% of a total 7080 truck drivers from 200 companies across the South Korean economy participating in the strike, which began on 24 November 2022.

China: Chinese regulatory authorities have instructed the country's financial institutions to begin lending more to property developers to help them complete residential construction projects. The International New York Times newspaper has reported that the Ministry of Finance has implemented tax breaks for non-first-time homebuyers. Meanwhile, People's Bank of China reduced the minimum total emergency funds to be held by commercial Chinese banks by US$70bn in order to free up cash. Industrial and Commercial Bank of China lent US$91bn to 12 different developers, while Bank of Communications lent US$14bn to leading property developer Vanke.

Governor of the People's Bank of China Yi Gang said “China’s housing sector is linked to a lot of upstream and downstream industries, so its healthy development is of great significance to the overall economy."

Belarus: The government has extended Belarusian Cement Company's exemption from paying customs duties and value added tax (VAT) on its goods imports until 31 December 2023. PrimePress News has reported that the cement producer had previously been exempt from payments up until 30 September 2022.

Bangladesh: Crown Cement has estimated the total cost of cement capacity currently unused in Bangladesh at US$1.46bn. The figure is even higher when maintenance costs are included, according to Crown Cement's chief advisor Masud Khan. Over the past 15 years, national cement capacity has nearly quadrupled to 83.3Mt/yr from 22.4Mt/yr, while demand has merely doubled to 46.7Mt/yr from 22.8Mt/yr. Khan estimated the cost per 1Mt/yr of new Bangladeshi cement capacity over the period at US$40m.

Khan said that producers continue to anticipate an acceleration in local cement consumption growth in the medium-term future. Reflecting on the situation up to the end of 2022, he said "They thought if they were not prepared for the growing demand, they would lose their market share. That was why they continued expansion, bearing the burden of excess capacity." Khan forecast a further decline in the industry's capacity utilisation if gross domestic product undergoes a forecast drop during the 2023 financial year, impacting on producers' results for the year.

India: Dalmia Bharat sold 12Mt of cement during the first half of its 2023 financial year, up by 20% year-on-year from 10Mt in the first half of the 2022 financial year. Its income was US$757m, up by 21% year-on-year from US$624m. Meanwhile, the company's earnings before interest, taxation, depreciation and amortisation (EBITDA) fell by 28% to US$116m from US$161m. The company noted the growth effects of 'fuel price corrections' during the second quarter of 2022, which it expects to increase its profitability during the second half of year.

Managing director and CEO Punit Dalmia said “We are pleased with the performance of the first half of this year despite the intense inflationary environment, and are confident that we will be among the best in the industry, leaving the bad times behind. While the geopolitical turmoil continues, we are confident in the resilience of the Indian economy, which is further cementing its position at the centre of global growth and consumption.” Dalmia continued “In view of the government's continued momentum in the infrastructure sector, driven by the revitalisation of the housing sector, we expect the demand for cement to grow rapidly. Looking ahead, we will remain focused on our capacity expansion progress.”

Dalmia Bharat's 14 integrated cement and grinding plants span 10 Indian states and have a capacity of 37Mt/yr, India's fourth largest.

Thailand: Siam Cement Group (SCG) recorded revenues of US$11.8bn during the first nine months of 2022, up by 15% year-on-year from US$10.2bn in the corresponding period of 2021. Its earnings before interest, taxation, depreciation and amortisation (EBITDA) declined by 26% to US$1.37bn from US$1.86bn.

SCG recorded nine-month costs growth of 15%, to US$3.29bn from US$2.85bn. The Bangkok Post newspaper has reported that the group says that its monthly energy costs have risen by 50% since the outbreak of the Russia-Ukraine war. As such, it is currently focusing its investments on three ‘key’ business areas with smaller energy consumptions than cement. These are smart living, renewable energy and logistics.

SCG renewables subsidiary SCG Cleanergy aims to more than double its renewable power generation capacity to 500MW before 2026 and further increase it to 5GW before 2028. This will consist of wind farms and roof-mounted and floating solar power plants. Meanwhile, SCG Logistics Management secured approval to merge with JWD InfoLogistics on 26 October 2022.