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Saudi cement firms make large year-on-year gain 10 June 2011
Saudi Arabia: Cement companies in Saudi Arabia recorded a 16% increase in sales in April 2011, the highest in more than a year. Domestic cement sales grew to 4.2Mt in April 2011, compared with 3.6Mt in the same period of 2010. Private projects, notably those for housing and schools boosted demand for the material.
"In 2010 people were very wary. The last thing they wanted to do was commit money, but now the outlook is looking brighter," said Farouk Miah, an analyst at NCB Capital in Riyadh. "There is also a lot of activity for plans to develop the rest of the country, in Makkah, Madina and Jeddah," he added.
Saudi Arabia is expected to need two million more homes by 2014 to keep up with the demands of a population that has quadrupled in 40 years. Shares of cement companies have already had a decent run in 2011, up an average of 24% over the same period of 2010.
It is expected that Saudi Cement, Southern Province Cement and Yamama Cement should benefit from the demand because they have the largest volume. Smaller cement companies, which are already running at full capacity, will be less well positioned to benefit.
Tsunami reconstruction demand calculated 09 June 2011
Japan: Post-earthquake reconstruction demand is expected to boost pre-tax profits at four major Japanese cement firms by a combined USD 411m until 2016.
Assuming that their market shares remain the same, reconstruction demand will push up pre-tax profits by USD 187.2m at Taiheiyo Cement Corp, USD 100m at Sumitomo Osaka Cement Co., USD 62.4m at Mitsubishi Materials Corp. and USD 62.4m at Ube Industries Ltd.
The Japan Cement Association estimates that 10Mt of cement will be used for reconstruction projects. The figure was arrived at based on damages estimated by the Cabinet Office and how cement sales increased in the aftermath of the 1995 Kobe earthquake. The trade group believes that full reconstruction will take about five years.
Cement firms each book an operating profit of about USD 50/t of cement sold. Taiheiyo Cement controls almost 40% of the market in Japan's north-eastern Tohoku region. Reconstruction demand will push up the firm's cement sales by nearly 4Mt, translating to a USD 37.4m contribution to pre-tax profit annually for the next five years.
New President for Cemex UK 08 June 2011
UK: Cemex has appointed Jesus Gonzalez as the company's new president for its UK operations. He was previously employed by Cemex in Panama, where he acted as president for the company's Central American operations.
Gonzalez has been employed by Cemex since 1998 and replaces Gonzalo Galindo, who has been appointed to the position of regional president, USA East.
Holcim back into profit in Q1 07 June 2011
Switzerland: Holcim has reported a return to profitability in its first quarter 2011 financial results, with net income of Euro8.07m on a 1.8% decline in sales. For comparison Holcim made a loss of Euro54.9m in the same period of 2010. The group's revenue for the first quarter of 2011 was Euro3.67bn compared to Euro3.83bn in the first quarter of 2010. The group's earnings before interest, tax, depreciation and amortisation (EBITDA) was down by 17.1% compared to the first quarter of 2010 at Euro608.2m. The company attributed the decline to negative currency impacts of Euro59m. When looking at like-for-like EBITDA, however, the decline was only 1.8%. The company added that like previous first quarters, the cash flow from operating activities was minus Euro434m due to seasonal factors.
Holcim said that it expects the construction market to continue to recover in 2011. Reporting its expectations for the rest of 2011 Holcim said, "We are still of the opinion that the construction sector in the mature markets will recover and that the growth in emerging markets will continue." Holcim added that it was confident of, "securing its share of future growth in the emerging market and that its lean cost structures will enable it to benefit above average from continuing economic recovery in Europe and North America."
French Lafarge's Frangey site to close doors in 2012 06 June 2011
France: On 1 June 2011 Lafarge announced that it would close its plant in Frangey, northern France, by the end of 2012. The site, which employs 74 people, is struggling due to overcapacity and high production costs. The workers will be offered alternative positions within the group. Workers at 10 cement plants and four grinding facilities in France staged a one-day strike on 6 June 2011 in protest at the closure.