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Fijian commission approves cement price rise 07 November 2013
Fiji: The Fiji Commerce Commission has approved a 2.7% increase in the wholesale price of bagged and bulk cement effective from 1 November 2013. Commission chairman Dr Mahendra Reddy said the prices were determined following factors raised in a detailed analysis of the submission from Fiji's sole cement producer, Fiji Industries Limited (FIL) and an independent investigation and analysis.
"Those factors included an increase in the price of raw materials (clinker and slag) from previous years because of the strong US currency, an increase in production labour rate by 4% based on union log of claim and an increase in capital expenditure to maintain the mill efficiency in the financial year 2013," said Reddy.
Update on Saudi Arabia
Written by Global Cement staff
06 November 2013
Demand for cement is so intense in Saudi Arabia that certain producers have reported production line shutdowns in dedicated stock market statements. Notably, industry newcomer Hail Cement reported a scheduled shutdown for late October/early November 2013, Al Jouf Cement reported unscheduled shutdowns in October and June 2013 and Najran Cement reported scheduled maintenance in July 2013. Even a short delay to cement production is a newsworthy event for both investors and analysts.
Saudi cement producers have risen to the infrastructure challenges of the country's Ninth Development Plan, increasing cement production by 6% year-on-year to 42.7Mt for the first nine months of 2013. In this febrile environment, the king ordered 10Mt of cement imports in April 2013 followed by government demands for producers to build up a two-month 'strategic' inventory reserve. Unsurprisingly, as we report this week, exports of cement from Saudi Arabia have fallen by 55% for the first nine months of 2013.
At the time of Global Cement's feature on Saudi Arabia in December 2012 only two of the country's cement producers had an inventory of joint clinker and cement stock meeting the government's stockpiling request. For the first nine months of 2013 the situation remains the same although the overall inventory has increased by 18% year-on-year to 10.3Mt. This compares to the end of 2012 where inventories fell year-on-year by 14% to 7Mt.
Unsurprisingly again, the Kingdom's major cement producers have seen balance sheets bulge so far in 2013. Yamama Cement reported a 12% year-on-year rise in net profit to US$145m for the first half of 2013 on the back of local demand. Saudi Cement Company reported a 5% year-on-year rise in its net profits to US$173m and Southern Province Cement saw a 4% year-on-year rise in its net profits to US$150m for the same period. Yanbu Cement saw its net profit rise by 29% year-on-year to US$176m for the first nine months of 2013.
With more large government infrastructure contracts pending, analysts expect the Saudi cement market to remain heated. Although as NCB Capital pointed out in September 2013, uncertainties over fuel supplies for coming cement plant expansions provide uncertainty to the situation. Nobody wants a repeat of the Yanbu - Aramco spat over fuel supplies that occurred in 2011. Irony would barely describe the situation if a Saudi Arabian cement boom was dented by a lack of fuel in one of the countries with the biggest oil reserves in the world.
Global Cement will be at stand T9 at the 18th Arab-International Cement Conference and Exhibition in Jordan from 11 – 13 November 2013
Holcim appoints Terver as head of Africa, Middle East and Indian subcontinent amidst senior management reorganisation
Written by Global Cement staff
06 November 2013
Switzerland: Bernard Terver, Member of the Holcim Executive Committee, has been appointed head of a company region encompassing Africa, Middle East and the Indian subcontinent. The appointment caps a series of changes in the company's senior management. All changes become effective on 1 January 2014.
Onne van der Weijde will remain Area Manager for India and will assist in the restructuring of Holcim's subsidiaries, ACC and Ambuja Cements. Javier de Benito will remain Area Manager for Africa and the Middle East, reporting directly to Terver. Member of the Holcim Executive Committee, Ian Thackwray will become responsible for East Asia, South East Asia, Oceania and Holcim Trading.
Daniel Bach, currently CEO of Holcim Romania, will be appointed Area Manager for South East Asia and member of senior management of Holcim. Alain Bourguignon, currently CEO of Aggregate Industries UK, will be appointed Area Manager for North America / UK and member of senior management of Holcim. He will report directly to the CEO of Holcim. Investor Relations and Risk Management will now report to CFO Thomas Aebischer.
Member of the Holcim Executive Committee Paul Hugentobler, currently responsible for South Asia and the ASEAN nations (Association of Southeast Asian Nations excluding the Philippines), will be retiring upon reaching the statutory age limit in February 2014. He will act as an advisor to the CEO of Holcim starting from 1 January 2014.
The area of responsibility of Holcim Executive Committee members Roland Köhler, in charge of Europe excluding the UK, and Andreas Leu, responsible for Latin America, will remain unchanged.
Lafarge sales down 4% to Euro4.24bn in the third quarter 06 November 2013
France: Lafarge has reported that its sales fell by 4% year-on-year to Euro4.24bn for the third quarter of 2013 from Euro4.39bn for the same period in 2012. The France-based building materials multinational blamed the results on adverse exchange rates which had a negative impact of 7% on both sales and profit indicators such as earnings before interest, taxes, depreciation and amortisation (EBITDA). Lafarge reported that its EBITDA fell by 6% year-on-year to Euro 1.01bn for the third quarter of 2013. Cement volumes remained stable at 36.7Mt.
By business region, cement sales volumes fell in North America, Western Europe, Central and Eastern Europe and Latin America for both the third quarter and the year to date. Mixed results were reported in the Middle East and Africa where cement sales volumes have fallen overall so far in 2013 but rose in the third quarter. Asia saw cement volumes rise in both periods.
Lafarge expects that the cement sector will grow at 0 - 3% in 2013 compared to 2012 due to market recovery in the US, continuing growth in most emerging markets and 'stabilisation' in Europe. The company intends to reduce its net debt to below Euro10bn in 2013, and below Euro9bn in 2014.
Vicat sales cement sales down by 2.8% to Euro855m so far in 2013 06 November 2013
France: The Vicat Group has reported that its consolidated cement sales have fallen by 2.8% year-on-year to Euro855m for the first nine months of 2013 from Euro879 in 2012. No reason was given for the decline. Cement sales volumes rose by 1.4% year-on-year to 13.7Mt. Overall the company saw its total sales remain stable year-on-year at Euro1.74bn.
"The United States, Switzerland, Turkey and Kazakhstan again delivered healthy business levels while political and security factors in Egypt and competition in India and Senegal continued to weigh on the Group's performance in these regions," said Guy Sidos, CEO of Vicat.