![](/templates/proglobalmedia-main/images/globe-blue-whitebg.gif)
Global Cement News
Search Cement News
Dangote profit up by 52% in first half 29 July 2013
Nigeria: Dangote Cement has announced that its half-year pretax profit rose by 52.1% to US$669m in 2013 compared with US$436m in the first half of 2012. Dangote said that a Nigerian building boom was behind the rise in profit.
Turnover at Nigeria's largest listed company rose to US$1.23bn during the six months to 30 June 2013, up by 28.5% from US$905m in 2012. The company announced that it expected a pretax profit of US$308m in the third quarter of 2013 from sales of US$603m.
Meanwhile, Reuters has reported that Dangote has announced plans to increase its cement capacity in Nigeria to 29Mt/yr by 2015 from 19.5Mt/yr at present. It added that it wants to expand its capacity to 55Mt/yr across Africa by 2016.
Dangote also reported that cement demand in Nigeria had risen to 11Mt/yr during the first half of 2013, a 14% year-on-year rise compared to the same period of 2012. This, the company said, was caused by a surge in government infrastructure projects.
Sri Lankan plant to be restarted 29 July 2013
Sri Lanka: The State Resources and Enterprise Development Ministry of Sri Lanka will re-establish a currently closed cement plant in Kankesanthurai, Northern Province, in the extreme north of the country. The plant will be restarted by Sri Lanka Cement. The ministry estimates that, with an investment of US$11.4m, the plant can become operational again within 12 months.
Project proposals to re-establish the factory were presented to State Resources and Enterprise Development Minister Dayasritha Tissera by Sri Lanka Cement Corporation Chairman N S M Samsudeen on 26 July 2013.
According to the project proposal, funds will be sought from the Bank of Ceylon and a copy of the project proposal was also presented to the Bank of Ceylon by Samsudeen. The project aims to produce a minimum of 12,000 x 50kg cement bags per day, which is 600t/day, or 0.2Mt/yr.
Sri Lanka Cement said that it could cover the project cost if it is selected as the main cement supplier for the Northern Highway project initiated by the government. "The project can save US$13m/yr in foreign exchange spent to import cement to the country and it will also generate 300 direct employment and 400 indirect employment opportunities for people in Kankesanthurai," said Samsudeen. Sri Lanka is in the process of building a series of new highways and toll-roads.
The announcement regarding Sri Lankan Cement comes shortly after a series of announcements regarding capacity expansion in Sri Lanka despite a decrease in demand for cement in the first half of 2013. Tokyo Cement plans a 1M/yr plant and Pakistan's D. G. Khan Cement and Thatta Cement have both announced plans for grinding capacity on the island.
Lafarge profit hit in second quarter 26 July 2013
France: The French multinational cement producer Lafarge has reported that its earnings before interest, tax, depreciation and amortisation (EBITDA) fell year-on-year in the second quarter of 2013. Despite this Lafarge said that its EBITDA was 'steady' considering the adverse weather conditions, absence of carbon dioxide sales and the negative impacts of foreign exchange variations seen during the quarter.
EBITDA for the second quarter of 2013 was recorded as Euro922m, 8% down on the second quarter of 2012 when it was Euro1002m. Operating income was also down from Euro750m in the second quarter of 2012 to Euro667m in the second quarter of 2013. However, Lafarge's net income for the quarter was Euro201m, significantly up on the same period of 2012 due to exceptional items during the year-ago quarter relating to Greek assets. It reported that it generated a total of Euro260m in the first half of 2013, which Lafarge described as 'on track' with its plan.
The group sold a total of 36.5Mt of cement in the second quarter compared to 38.4Mt in the second quarter of 2012. It sold 65.2Mt/yr of cement in the first half of 2013 against 69.7Mt sold in the first half of 2012.
Lafarge's net debt at the end of June 2013 was down by Euro0.7bn compared to at the end of June 2012, reflecting the strict control of investments and working capital optimisation. With the recently announced divestment of its US gypsum operations, the group has secured Euro1.5bn since the beginning of 2012. Euro0.9bn more will come in the second half of 2013.
Bruno Lafont, Chairman and Chief Executive of Lafarge, said, "Our results in the second quarter resisted in an environment that was marked by a conjunction of unfavourable circumstances. We increased prices and performance and innovation results are in line with our 2013 Euro650m additional EBITDA target. Taking into account first-half volumes, we foresee a cement demand growth in our markets of 0-3% in 2013, which implies more positive trends in the second half."
Lafarge's sales volumes across all business lines were down in the second quarter of 2013. It suggested that this was in part due to a better-than-expected 2012 performance and poorer weather in 2013, especially in North America. A temporary fuel shortage in Egypt also put some pressure on cement volumes in that country.
Across all business units Lafarge's EBITDA in North America was Euro141m in the second quarter of 2013, down by 17% (8% on a like-for-like basis) compared to Euro170m in the same period of 2013. EBITDA for this region was flat year-on-year despite the loss of assets in the US cement industry. This represents a like-for-like improvement of 17%.
In Western Europe, Lafarge's EBITDA was Euro145m, down by 16% (14% like-for-like) compared to Euro173m in the second quarter of 2012. In the first half overall its EBITDA plummeted by 45% (38% like-for-like) from Euro255m in 2012 to Euro150m in 2013.
In Central and Eastern Europe, EBITDA was also down in the second quarter, from Euro101m in 2012 to Euro80m in 2013. This was a 21% fall in both absolute and like-for-like terms. In the first half of 2013 its performance was similarly poor, with a 48% drop in EBITDA from Euro87m in the first half of 2012 to Euro45m in the first half of 2013.
The Middle East and Africa saw an 8% decline in EBITA in absolute terms (1% like-for-like) from Euro329m in the second quarter of 2012 to Euro304m in the second quarter of 2013. Over the first half of 2013 its EBITDA for this region fell by 15% in absolute terms (10% like-for-like) from Euro646m in 2012 to Euro550m in 2013.
Latin America, however, saw a 1% improvement (7% like-for-like) in EBITA year-on-year from Euro70m in the second half of 2012 to Euro71m in the second quarter of 2013. In the first half its EBITDA for this region fell by 5% year-on-year (up 1% like-for-like) from Euro129m in 2012 to Euro122m in 2013.
Finally, Lafarge's best performing region was Asia, where it recorded EBITDA improvement of 14% year-on-year (16% like-for-like) in the second quarter to Euro181m from Euro159m. In the first half, absolute improvement in EBITDA was also 14% higher (17% like-for-like) at Euro306m compared to Euro268m in 2012.
Looking towards the future, Lafarge expects cement growth in its markets of 0-3% in 2013 compared to 2012, factoring in low volumes in the first-half. Emerging markets continue to be the main driver of demand and Lafarge says that it will benefit from its 'well-balanced geographic spread of high-quality assets.'
The group also expects higher pricing in 2013 and that cost inflation will continue, although at a lower rate than in 2012. This, it says, will benefit from positive trends in coal and petcoke prices. The group targets to deliver additional EBITDA of Euro650m in the year through its performance and innovation measures.
Mexico: Cemex has reported that consolidated net sales reached US$4.0bn during the second quarter of 2013, an increase of 4% compared to the comparable period of 2012.
Operating earnings before interest, tax, depreciation and amortisation (EBITDA) also increased by 4% year-on-year during the quarter to US$730m. Adjusting for the higher number of business days in its operations during the quarter, consolidated net sales improved by 2% and operating EBITDA increased by 2% year-on-year. Operating earnings before other expenses, net, during the second quarter increased by 24% to US$451m. Cemex said that an increase in consolidated net sales was mainly due to higher prices in local currency terms and higher volumes in most of its regions. However, controlling interest net income was a loss of US$152m, an improvement over a loss of US$187m during the same period of 2012.
Fernando A González, executive vice president of finance and administration, said, "We are pleased to report that this is the eighth consecutive quarter with year-over-year improvement in EBITDA. We also saw an increase in our consolidated prices in local-currency terms for cement, ready mix and aggregates during the quarter. On the cost side, our alternative fuel substitution initiatives remain a very high priority. On a consolidated basis, our alternative fuel utilisation reached 28% during the quarter. In addition, we are implementing targeted cost-reduction initiatives in Mexico and northern Europe, which we expect will result in savings of about US$100m during the second half of 2013."
Net sales in Cemex's Mexican operations increased by 2% year-on-year in the second quarter of 2013 to US$847m. Operating EBITDA decreased by 17% to US$250m. In the United States, Cemex reported net sales of US$868m for the quarter, up by 9% year-on-year compared to the 2012 quarter. Operating EBITDA increased to US$80m in the quarter, compared to US$27m in the same quarter of 2012. Cemex's operations in South, Central America and the Caribbean reported net sales of US$561m during the second quarter of 2013, representing an increase of 6% over the same period of 2012. Operating EBITDA increased by 12% to US$211m in the second quarter of 2013, from US$189m in the 2012 quarter.
In Cemex's Northern Europe region, net sales for the second quarter of 2013 decreased by 1% to US$1.09bn, compared with US$1.1bn in the second quarter of 2012. Operating EBITDA was US$108m, 11% down year-on-year. Second-quarter net sales in the Mediterranean region were US$400m, 4% higher compared with the US$384m taken during the second quarter of 2012. Operating EBITDA in this region decreased by 2% to US$94m.
Operations in Asia reported a 14% increase in net sales for the second quarter of 2013 at US$162m. Operating EBITDA for the quarter was US$38m, up by 29% from the same period in 2012.
Cemex Latam sales up by 8% in Q2 2013 24 July 2013
Colombia: Cemex Latam has reported that its consolidated net sales rose year-on-year by 8% to US$431m in the second quarter of 2013. The Cemex subsidiary, based in Colombia, Panama, Costa Rica, Nicaragua, El Salvador, Guatemala and Brazil, attributed the rise to higher volumes, driven by improved construction activity and higher prices. Cemex Latam's operating earnings before interest, taxes, depreciation and amortisation (EBITDA) increased year-on-year by 16% to US$166m
"We are very pleased with the favourable results in the second quarter, as evidenced by the record level of operating EBITDA margin that reached 38.5%. We are also very encouraged with the results seen so far in connection with our new strategy based on commercial solutions that are allowing us to capture incremental value," said Carlos Jacks, CEO of Cemex Latam.
By region, Cemex Latam's operating EBITDA in Colombia increased by 12% to US$103m in the second quarter of 2013 and net sales increased by 6% to US$238m. In Panama, operating EBITDA increased by 14% to US$40m and net sales increased by 8% to US$81m. In Costa Rica, operating EBITDA increased by 37% to US$19m and net sales increased by 28% to US$42m. In Cemex Latam's remaining territories operating EBITDA increased by 7% to US$21m and net sales were US$74m.