India: P R Ramasubrahaneya Rajha, the chairman of business conglomerate Ramco Group, has died at the age of 82 after a brief illness. He is survived by his wife and son P R Venkatarama Rajha, the vice-chairman and managing director of the group, according to the Press Trust of India. Ramasubrahaneya Rajha was the son of the group’s founder P A C Ramasamy Rajah.

Denmark: Bjarne Moltke Hansen has resigned as the Group Executive Vice President of FLSmidth. The 57-year old Danish national started his career in 1984 working for Unicon, a subsidiary of FLSmidth at the time. He subsequently held the position as chief executive officer (CEO) of Cembrit Holding for five years before taking up the position as CEO of Aalborg Portland Holding in 2000. In 2002, Bjarne took on the position as Group Executive Vice President, Customer Services Division until he was appointed Group Executive Vice President, Product Companies Division in 2015.

Today HeidelbergCement publishes its financial results for the first quarter of 2017, giving us an idea of how the year is shaping out for the major cement producers outside of China. Looking at graphs 1 and 2 below of cement production volumes and sales revenue gives the initial impression of a reversal of fortunes for the two leading multinational companies. LafargeHolcim’s production and sales are declining as HeidelbergCement races to catch up, boosted by its acquisition of Italcementi in 2016.

This interpretation would be misleading, however, given that LafargeHolcim has been steadily whittling down its assets to become more profitable and because HeidelbergCement has just taken on a raft of production units. The real figures to look at might be the like-for-like changes with adjustments made for currency, consolidation effects and suchlike. Under these conditions each of the three leading cement producers, with the addition of Cemex, have reported stagnant cement sales in the period. Yet the surprise comes from an analogous look at sales. LafargeHocim and Cemex both reported sales revenue increases of 5 – 6% on a like-for-like basis, whilst HeidelbergCement reported no change. This is further backed up by operating earnings before interest, taxation, depreciation and amortisation (EBITDA) figures that rose significantly on a like-for-like basis for LafargeHolcim at 8.8%, more modestly at 2% for Cemex but fell by 3% for HeidelbergCement.

Graph 1: Cement sales volumes at selected multinational producers in Q1 2016 and Q1 2017. Sources: company reports.

Graph 2: Sales revenue at selected multinational producers in Q1 2016 and Q1 2017. Sources: company reports.

The tragedy of the picture above appears to be that Eric Olsen, the chief executive officer of LafargeHolcim, has started to turn the company around following the merger between Lafarge and Holcim in 2015, just as he is leaving the company. This week Olsen denied that his departure was related to the Syria scandal but that it was related to ‘tensions’ at the group. The lesson that HeidlebergCement can take from this is that enlarging a building materials company in a supressed global market requires decisive action to maintain profitability. Certainly, if it doesn’t go HeidelbergCement’s way in future months and years then the stability of its management and major shareholders may become apparent. Although it doesn’t mention internal matters, HeidelbergCement does flag up higher geopolitical and macroeconomic risks in its outlook for 2017 as well as a ‘shift of political measures towards protectionism.’ That last one is potentially bad news for a multinational cement producer looking to move excess clinker around as it downsizes towards profitability.

Of the rest of the producers included in the graphs above Dangote Cement is worth some attention. The production and sales figures show a company evolving from a national player into an international one. Challenged by economic problems and a market contraction at home in Nigeria the company is exploding internationally in sub-Saharan Africa. Roughly, it sold a third of its cement outside of Nigeria in the period but only made a quarter of its revenue outside of its home turf. This has interesting implications for the international future of the company. However, it will be a big moment for the firm once it finally builds a plant in Nepal outside of Africa.

Italy’s Buzzi Unicem and the Brazilian operators Votorantim and InterCement are due to release their first quarter results in the coming weeks which will flesh out the international picture. Already there are lots of fascinating regional trends emerging that require discussion, such as the Philippines that we looked at last week and a ‘back to business’ feeling in China. Next week in the run up the IEEE/PCA Cement Industry Technical Conference in Calgary, Canada we’ll look at the US.

Ukraine: The supervisory board of Podilsky Cement has appointed Leonard Barry as its supervisory board chairperson. Previously, he was the director of CRH in the country, according to the Ukrainian News Agency. Barry, aged 52 years, is an Irish national. He joined Irish Cement in 1989 as a process engineer before becoming its managing director in 2011. He trained as a chemical engineer at University College Dublin and holds an MBA from the University of Limerick.

Other personnel changes include the appointment of Declan Maguire, CRH’s chief operational director for Eastern Europe, as deputy supervisory board chairperson. Alan Connolly has also been appointed as secretary of the supervisory board.

China: Chong Cha Hwa has resigned as a non-executive director from China Shanshui Cement due to physical trauma suffered during the ‘illegal’ occupation of the Jinan properties of its Shandong Shanshui in early April 2017. Chong said that the occupation had impeded him from carrying out his duties.

Nigeria: Mallam Suleiman Yahyah has resigned as chairman from AshakaCem. Yahyah joined the board of directors of the subsidiary of LafargeHolcim in 2010 and became its chairman in 2015.

Germany: Peter Feldhaus has been appointed as the new chief executive officer (CEO) of the Industrial Solutions business division of ThyssenKrupp. Feldhaus, aged 50 years, succeeds Stefan Gesing, who was the acting CEO of the division. Gesing remains as the chief financial officer of the group. The new CEO of ThyssenKrupp Marine Systems will be Rolf Wirtz, currently CEO of Atlas Elektronik. Jens Bodo Koch, member of the management board of Atlas Elektronik, is to take over as acting CEO.

Germany: Susanne Fuchs has been elected to the supervisory board of Fuchs Petrolub in place of her father Manfred Fuchs. Manfred Fuchs, aged 78 years, resigned as deputy chairman of the board at the end of the group’s annual general meeting. The company’s chairman of the executive board is Manfred Fuchs’s son, Stefan Fuchs. Susanne Fuchs holds a doctorate in veterinary medicine and successfully completed her MBA at the Open University in the UK in 2016.

France: Julien Soum has been appointed as the European business development manager at Anderman Ceramics. Soum has worked as a commercial engineer in Europe for the last five years with knowledge of the refractory markets for cement and steel working for Refractaria and Hepha. He was educated at the University of Montpellier and the Kedge Business School in Marseille.

The Philippines has been messing up the balance sheets of cement producers so far in 2017. Over the last week Holcim Philippines, CRH and Cemex have each reported lacklustre first quarter results dragged down by poor performance in the country. CRH’s chief executive officer Albert Manifold seemed to receive the worst kicking when analysts in a conference call refused to let it pass that the company’s sales had dropped by 12% year-on-year in Asia. Although to be fair to him the group’s Asian division only represented 2% of global sales at Euro0.5bn…

CRH’s quarterly financial reports tend to be in the form of sparse trading updates. So this lack of detail and CRH’s plans to invest over Euro300m in the market may have prompted Manifold’s grilling. According to the Irish Times he blamed the situation on cheap imports from south-east Asia pulling down the price. He then defended the investment on the grounds that local producers would have an advantage as they increase production capacity due to constant production and ‘guaranteed’ regulation and certification.

CRH isn’t the only organisation that has been burned by the Philippines. Before Christmas this column was praising the local industry for being in a boom. Cement sales had risen by 10.1% year-on-year to 20.1Mt according to CEMAP data in the first nine months of 2016 and the Duterte Infrastructure Plan was starting to target hundreds of billions of US dollars towards infrastructure spending. In the end cement sales rose by 6.6% to 26Mt for the full year in 2016 and this was a solid performance despite being brought down by the fourth quarter.

From the cement producers mentioned above, Cemex reported that its Ordinary Portland Cement sales volumes fell by 9% in the first quarter. It blamed the fall on bad weather and a tough quarter to compare against in 2015. Holcim Philippines said that its net sales fell by 12% to US$176m and it attributed it to lower public infrastructure spending, tighter industry competition and higher production expenses. Eagle Cement meanwhile, the fourth of the country’s major producers, is preparing to float on the local stock market in May 2017 to fund an expansion drive. The poor results of the other three cement producers may dent its proceeds from the initial public offering (IPO).

The words CRH’s Albert Manifold used in his defence were that, “Brand matters over there.” Funnily enough the other big Philippines cement industry news story that has been rumbling away for the last few months is an investigation by the Philippine Competition Commission (PCC) into the conduct of the Cement Manufacturers Association of the Philippines (CEMAP) and some of the leading cement producers. Naturally this includes CRH’s joint venture Republic Cement. The enquiry was prompted in mid-2016 by the accusation of anti-competitive agreements by a former trade official. He also made direct allegations against Ernesto Ordonez, the head of CEMAP. The investigation is on-going and perhaps it will find out exactly how much ‘brand matters’ in the Philippines.