Global Cement News

India: Birla Corporation has promoted BR Nahar to the managing director of the company. The decision was made at the board of directors meeting held on 28 July 2012. Nahar, a Fellow Member of the Institute of Chartered Accountants of India, holds more than 33 years professional experience. He became Birla's executive director and chief executive officer in 2006. He has served in diverse fields at senior positions in various large corporate houses.

Italy: Italcementi Group has released consolidated results for the six months to 30 June 2012, which show mixed results across its operations. Revenue and earnings were both down, as was the group's net profit, which was drastically down due to the absence of a major one-off receipt seen in the year-ago period. The company announced that it expected the second half of 2012 to be broadly in line with that of 2011.

The group's consolidated revenue for the first half of 2012 was Euro2.29bn compared to Euro2.42bn in the first half of 2011. Recurring earnings before interest, tax, depreciation and amortisation (EBITDA) came in at Euro328.7m compared to Euro371.7m in the first half of 2011. Italcementi's total profit for the period was Euro0.8m, compared to Euro187.8m in the first half of 2011. This apparent drop was due to the absence of a receipt from the sale of Turkish operations, which was conducted in the first half of 2011.

In the first half of 2012 consolidated cement and clinker sales totalled 23.5Mt, a drop of 7.5% compared to the first half of 2011. The reduction was largely due to the decline in central western Europe and, to a lesser degree, in Egypt. Sales in Asia continued to make good progress and sales volumes in North America and Bulgaria showed a strong recovery.

Italcementi said that its first half results confirm the upturn in North America and the recovery in prices in some markets, although demand was down in the Eurozone. Among emerging countries, it recorded positive market performances in India and Morocco, while the sales trend in Egypt remained negative, although better than expected. It added that its withdrawal from the Turkish market a and new strategic agreement in China had generated positive impact on its financial position.

Going forward, Italcementi said that the effects of efficiency measures, together with a positive dynamic in prices on a number of markets should enable it, in the absence of currently unforeseen events, to reach full-year operating margins broadly in line with those of 2011.

Germany: Price increases and cost cutting at HeidelbergCement have halted a slide in cement margins and put the German cement producer on track to reach its 2012 targets.

HeidelbergCement's operating income before depreciation (OIBD) for the quarter ending 30 June 2012 rose by 7% to Euro698m from Euro651m in the same quarter in 2011. Its revenue rose by 11% to Euro3.78bn from Euro3.39bn. The company's efforts to chip away at its cost base, easing energy costs and price increases pushed through in 2012 have all helped HeidelbergCement post a 0.2% improvement in cement margins following steady declines in 2011 and early in 2012.

"We will do everything in our power to continue this positive trend in the second half of 2012," said chief executive Bernd Scheifele in a statement.

Demand for cement has remained robust in North America and Asia, prompting HeidelbergCement to affirm its outlook for a third consecutive year of growth in sales and operating profit. HeidelbergCement has also benefited from a slide of the euro against the US Dollar in the second quarter, which helped boost group revenue growth by 5 percentage points to 11.4%. Net profit was up by 16% to Euro184m.

Cement sales volumes benefited from strong demand in North America and Asia but sales declined in Europe due to decline in infrastructure spending. In western and northern Europe cement and clinker sales volumes fell by 5.1% in the first half of 2012 to 10.2Mt from 10.8Mt in 2011. In eastern Europe and central Asia cement and clinker sales volumes increased by 3.0% to 7.8Mt from 7.6Mt. In North America cement sales grew by 16.7% to 5.4Mt from 4.7Mt. In Asia-Pacific cement and clinker sales grew by 9.5% to 14.8Mt from 13.6Mt.

HeidelbergCement predicts that cement volumes in North America will rise by 8-11% in 2012, compared with a previous forecast of 4-7%. Sales in western and northern Europe could decline by as much as 2%. The company has slashed its global outlook for volumes to 4-6% growth, down from 6-9%, as its assessment of eastern Europe and Africa deteriorated.

"The growth in sales volumes, due to the additional capacities and a more or less significant increase in demand in Russia and central Asia, is being somewhat muted by the latest decline in demand in Poland and the Czech Republic," said HeidelbergCement.

Egypt: FLSmidth has been awarded a contract by the Egyptian National Cement Company for operation and maintenance of two of their production lines located in Cairo, Egypt. The parties have agreed not to disclose the value of the contract which covers a period of seven years but the order will contribute beneficially to FLSmidth's earnings until 2019.

The contract which is the largest operation and maintenance contract awarded to FLSmidth to date includes supply of spare parts and consumables, development of a full operation and maintenance organisation, knowledge transfer to local employees and implementation of industry best practice.

FLSmidth is currently carrying out an upgrade of the two production lines, which were originally supplied by German KHD and have been in operation since the mid 1980s. When the upgrade is completed in early 2014 each line will rise in capacity to 5200t/day from 3800t/day at present.

"We are now for the first time also taking over the operation and maintenance of a plant, which was built by a competitor and consists of a competitor's equipment, and still FLSmidth is in a better position to meet production and quality targets and optimising the customer's earnings capacity," commented group CEO Jørgen Huno Rasmussen.

Nepal: Bishal Cement Industries (BCI) formally commenced operation on 28 July 2012. The factory based in Manahiya VDC-4 in the Rupandehi district, produces 300t/day of OPC and 400t/day of PPC brand cement.

"We are planning to use 70% and 30% of the total capacity to produce Pozzolanic Portland Cement (PPC) and Ordinary Portland Cement (OPC)," said Jayendra Chudal, executive director of the company.

Costing over US$5.6m the factory has an inbuilt dust controller and six dust bag collectors to control the emissions. The company has been sourcing raw materials such as gypsum from India, Pakistan and Bhutan but using locally produced clinker. Direct employment opportunities have been provided to 150 skilled and semi-skilled workers.

With the opening of Bishal the number of cement factories operating along the Bhairawa-Lumbini Industrial corridor has reached 11. Producers estimate that Nepal has been importing 30% of its cement from India to meet its total domestic demand for 25Mt.