Global Cement News

Nigeria: Flour Mills of Nigeria plans to borrow up to US$500m to finance a 2.5Mt/yr upgrade at its 2.5Mt/yr UNICEM joint venture cement plant in Calabar, according to its chief finance officer. Flour Mills operates in the Nigerian cement market as Burham Cement and it shares its joint venture with Holcim and Lafarge.

In an interview with Reuters, Jacques Vauthier announced that the conglomerate had appointed financial advisers and banks to raise a term loan from the local market for the construction of the plant. He said that the details of the loan were still being finalised. The new cement plant will be completed by the first quarter of 2016.

Vauthier acknowledged the cement glut in 2012 and blamed it on cheap imports from Asia. He added that sales were picking up again and he expected its cement subsidiary Unicem to end 2013 with a year-on-year growth rate that is in double-digits.

This news story was updated on 11 November 2013 with the exisiting capacity of the UNICEM cement plant

Nigeria: German vertical roller mill (VRM) producer Loesche GmbH has been awarded a contract for five new VRMs from China's Sinoma International Engineering, which is building a two kiln extension to the existing Dangote Cement Ibese plant. Loesche previously delivered equipment for the first and second lines at the same plant.

The five VRMs to be supplied are two 450t/hr Loesche Mill Type LM69.9 mills for raw material and three 310t/hr cement LM 63.3+3C cement mills. As with previous work at Ibese, the high moisture of the material of up to 20%, the sticky nature of the raw material and the low grindability of the raw material represent special challenges for the project.

In addition to the mills and the mill motors, Loesche will deliver metal detectors and hopper discharge feeders. The supply of the equipment will be split between Loesche, which is supplying key parts, and a Chinese-manufactured portion arranged by Sinoma International under supervision of Loesche. Delivery is scheduled at the end of 2013.

Ethiopia: Sinoma has also announced that it has contracted Loesche as the sole supplier of grinding technology for the construction of the Menagasha grinding plant, which is being constructed by Dangote. Delivery will be in early 2014.

Four Loesche mills will be included in the process; a 450t/hr LM 69.6 for raw material grinding, a 50t/hr LM 28.3D for coal grinding and two LM53.3+3C mills will be used for grinding clinker additives such as gypsum, limestone and pumice.

In addition to the mills and the mill motors, Loesche will deliver metal detectors and mill rotary feeders. The supply is a split-up of Loesche key parts and a Chinese manufactured portion arranged by Sinoma International under supervision of Loesche.

Both the plant elevation of 2600m above sea level and the very poor grindability of the cement raw material represents a special challenge for the layout of the grinding equipment in this case.

India: Jaiprakash Associates has reported a more than 64% decline in standalone net profit at US$20.6m for its third quarter, which ended on 31 December 2012, as its interest burden increased by over 20%. For comparison, the Noida-based company had a net profit of US$57.4m in the third quarter of the 2011-2012 fiscal year.

Its net sales, however, were up by 15.3% to US$629.5m during the quarter compared to US$545.9m in the October-December period of the 2012 fiscal year. Revenues from the cement segment were up by nearly 7% to US$273.2m.

The company's total expenditure of US$521.8m amounted to nearly 83% of its net sales during the quarter. Its interest outgoings increased by 20.7% to US$98.7m. Its other income, mainly interest on deposits, also declined by nearly 36% to US$15.8m, impacting the company's financial results for the quarter.

Zimbabwe/Mozambique: South African cement manufacturer PPC's (Pretoria Portland Cement) Zimbabwean subsidiary, Portland Holdings Limited (PHL), is to build a new cement plant in the country to service its markets in Zimbabwe and Mozambique. The new plant will produce about 1Mt/yr of cement and will work alongside a separate grinding facility being constructed in Tete in Mozambique.

"In recent years our investment in Zimbabwe has show strong growth on the back of a more buoyant and stable economy," said PPC's chief executive officer, Ketso Gordhan. "This, together with the fact that PPC has received an indigenisation certificate, makes us optimistic about the future of the economy and the country as a whole."

"The construction of additional cement capacity will ensure that PPC continues to be a key player in the development of infrastructure in Zimbabwe and neighbouring countries," added Gordhan. "It is totally in line with our stated strategy of growing our non-South African revenue from the current 21% to at least 40% by 2016.

"Not only will this investment address the expected future increase in cement demand in Zimbabwe but create employment opportunities, beneficiation of the country's mineral reserves and a significant growth opportunity for our indigenisation partners," said PHL's managing director, Zak Limbada.

Mexico: Mexican building materials company Cemex has declared 2012 to have been a year of 'recovery' with the announcement of rising earnings before interest, taxes, depreciation and amortisation (EBITDA) and rising operating earnings. EBITDA rose by 10% to US$2.62bn from US$2.37bn. Net operating earnings before other expenses rose by 35% to US$1.31bn from US$0.97bn. However, net sales fell by 2% to US$15bn in 2012 from US$15.2bn in 2011.

"During the year we achieved the highest EBITDA generation and operating EBITDA margin since 2009 and the fourth quarter was the sixth consecutive quarter with a year-over-year EBITDA increase. We are particularly pleased with the quarterly performance of our operations in the United States and the South, Central America and Caribbean and Asia regions," said Fernando A González, Executive Vice President of Finance and Administration. Cemex said that infrastructure and residential sectors were the main drivers of demand in most of its markets.

For the fourth quarter of 2012 Cemex's performance was more muted. Net sales remained static year-on-year at US$3.71bn. EBITDA rose by 13% to US$611m from US$540m. Net operating earnings before other expenses rose by 26% to US$285m from US$227m.

Cemex produced 65.8Mt of cement in 2012, a 1% decrease from 66.8Mt in 2011. This drop was more pronounced in the fourth quarter. Cemex produced 15.8Mt in the fourth quarter of 2012, a 3% decrease from 16.3Mt in 2011.

By region, net sales in Mexico decreased by 3% to US$3.38bn in 2012 from US$3.47bn in 2011. In the fourth quarter sales increased by 2% year-on-year. In the US sales increased by 17% to US$3.06bn from US$2.62bn. In Northern Europe sales fell by 13% to US$4.1bn from US$4.73bn, led by a 15% decline in Poland. In Cemex's Mediterranean region sales fell by 15% to US$1.46bn form US$1.72bn, led by a 40% decline in Spain. Operations in South, Central America and the Caribbean reported an increase in sales of 20% to US$2.09bn from US$1.75bn. In Asia sales rose by 7% to US$542m from US$505m, with the Philippines performing well with 12% growth.