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Jidong Cement plans to buy into Jilin Yatai 23 May 2014
China: Tangshan Jidong Cement plans to acquire about 108.48 million additional shares in Jilin Yatai Group for US$60.3m, at US$0.56/share. After that, Jidong Cement will hold less than a 5% stake in Jilin Yatai. Jidong Cement said that the capital source of the external investment was a self-owned one and that the deal would not affect its 2014 operations.
South Africa: PPC has announced that when the next round of PPC salary adjustments takes effect in October 2014, company CEO Ketso Gordhan would earn only 40 times more than his lowest-paid worker.
When Gordhan took over as CEO in January 2013 he was earning 120 times more than his lowest-paid worker. However, the company's drive to reduce the earnings differential had reduced this to a multiple of 48. This followed Gordhan's US$96,370 pay cut in October 2013, while the remuneration of his top 60 managers was frozen so that the wages of the cement maker's 1200 lowest-paid workers could be raised.
Gordhan said that he would not take a pay increase in October 2014 and PPC's other executives would be awarded increases of about 4.5 - 5%, less than the usual 6.5%. This would allow the minimum total pay package at PPC to be hiked to nearly US$1060. According to Gordhan, the 40-times multiple was seen by many as 'a justifiable spread.'
The company's new black economic empowerment (BEE) deal, which gives employees 12% share ownership in the company, could generate as much as US$193m for PPC's employees over five years if share price targets of US$5.78/share are reached.
The company's new BEE deal is a restructure of its 2008 deal, which was designed around broad-based trusts but was complicated and costly. The new BEE deal involves the issue of ordinary shares to the PPC Phakamani Trust and the issue of a new class of perpetual preference shares, to be used to raise capital to fund the unwinding.
James Hardie doubles annual profit 22 May 2014
Australia: Fibre cement producer James Hardie Industries said on 22 May 2014 that it expects the US housing construction market to improve in 2014 as it posted a more than doubling in annual net profit. "The company continues to expect improvement in the US operating environment," said James Hardie.
James Hardie, which generates two-thirds of its revenue in Europe and the US, said that its annual net sales in those markets grew by 19%, helped by strong rises in US single-family building permits. James Hardie posted a net profit of US$99.5m for the year to 31 March 2014, up from US$45.5m in the previous year. Net operating profit, which excludes charges for asbestos liability, asset impairments and regulatory charges, was US$197.2m compared with US$140.8m in the prior year. Overall net sales grew by 13% to US$1.49bn.
James Hardie has been compensating Australian victims of asbestos-related illnesses such as mesothelioma and said that its asbestos liability grew by US$186.18m to US$1.44bn by 31 March 2014, after the number of claims were higher than expected for a second consecutive year.
India: Reliance Cement Company, part of the Anil Ambani-controlled Reliance Infrastructure, is looking at a turnover of around US$341m in the current fiscal year on the back of capacity expansion and entry into West Bengal. The company has made a foray into West Bengal, a market with 14Mt/yr of cement demand and the potential to grow by 8%/yr in the coming years.
"We are targeting cement sales of 3.5Mt and a revenue of US$307 - 341m in fiscal 2015," said Reliance Cement Director & CMO Atul Desai. "We hope to cover the entire West Bengal market in fiscal 2015, which is expanding by 8%/yr. We expect to sell 0.6 - 0.7Mt of cement in the state in fiscal 2015."
"West Bengal is one of the largest cement-consuming states in eastern India with a total consumption of around 14Mt/yr," said Reliance Cement Head (East) Deepak Ranjan. He added that Reliance Cement hopes to garner a healthy market share in the region.
Reliance Cement also plans to set up a 2.1Mt/yr cement grinding plant in Raghunathpur, West Bengal. Desai said that the company has 0.40km2 of land and is in the process of getting regulatory clearances for the project.
Reliance Cement has also lined up cement plants in various locations to increase capacity and is in various stages of acquiring limestone mining leases. "The group aims to expand its cement production capacity to 50Mt/yr over the next couple of years," he said.
India: Chettinad Cement has acquired a 20.58% stake in Anjani Portland Cement Ltd from its promoter KV Vishnu Raju. The acquisition was done in an off-market transaction and 37,84,014 shares were acquired by Chettinad Cement at US$1.054/share on 20 May 2014. After the transaction, Chettinad Cement's stake in Anjani Portland Cement rose from 20.58% to 41.16%.