Displaying items by tag: Cemex
Latin America: Cemex Latam Holdings, Cemex's Latin American subsidiary, has reported net consolidated sales of US$864m during the first half of 2014, representing a year-on-year rise of 6%. Company earnings before interest, taxes, depreciation, and amortisation (EBITDA) fell year-on-year by 8% during the first six months of 2014, reaching US$283m, due to scheduled maintenance works. EBITDA levels are expected to improve during the second half of 2014. Cemex Latam Holdings recorded net profits of US$121.2m in January - June 2014, 14% down on the same period in 2013.
Mexico: Cemex has announced its financial results for the second quarter of 2014, which show that consolidated net sales reached US$4.2bn during the second quarter of 2014, an increase of 4% compared to the comparable period in 2013. Operating earnings before interest, tax, depreciation and amortisation (EBITDA) increased by 1% during the quarter to US$737m compared to the same period in 2013. On a like-for-like basis and adjusting for business days in its operations during the quarter, consolidated net sales increased by 5% and operating EBITDA increased by 3% versus the second quarter of 2013.
Cemex said that the increase in consolidated net sales was due to higher prices of its products in local currency terms in most of its operations, as well as higher volumes in the US and the Mediterranean, South & Central America and the Caribbean and Asia regions.
Fernando A González, Chief Executive Officer, said, "We are pleased with the year-to-date trends we have seen in volumes for our three core products and the continued success of our value-before-volume strategy. We expect improved performance from our Mexican operations during the second half of the year which should lead to stronger overall EBITDA generation for the full year 2014."
Breakdown by geographical area
Net sales in Cemex's operations in Mexico decreased by 4% in the second quarter of 2014 to US$816m, compared with US$847m in the second quarter of 2013. Operating EBITDA decreased by 1% to US$247m versus the same period of 2013.
Operations in the United States reported net sales of US$957m in the second quarter of 2014, up by 10% compared to the same period in 2013. Operating EBITDA increased to US$119m for the quarter, compared to US$80m in the same quarter of 2013.
In northern Europe, net sales for the second quarter of 2014 reached US$1.1bn, a 5% increase compared with the second quarter of 2013. Operating EBITDA was US$121m for the quarter, 12% higher than a year earlier.
Second-quarter net sales in the Mediterranean region were US$449m, 12% higher than sales of US$400m during the second quarter of 2013. Operating EBITDA increased by 6% to US$100m for the quarter versus the comparable period in 2013.
Cemex's operations in South & Central America and the Caribbean reported net sales of US$562m during the second quarter of 2014, remaining flat compared to the same period of 2013. Operating EBITDA was down by 16% to US$178m in the second quarter of 2014, from US$211m in the second quarter of 2013.
Operations in Asia reported a 2% decrease in net sales for the second quarter of 2014 to US$160m, versus the second quarter of 2013. Operating EBITDA for the quarter was US$34m, down by 11% compared to the same period of 2013.
Spain: The European Commission (EC) has objected to Cemex's plan to acquire Holcim's Spanish units, according to Reuters.
Cemex and Holcim unveiled the deal in August 2013, part of which included Holcim taking over Cemex's German businesses. The EC cleared this deal unconditionally earlier in July 2014. However, the Spanish part of the deal triggered an in-depth probe by the EC in April 2014. The preliminary review showed that the takeover would substantially curb competition in the grey cement market in certain parts of Spain.
"The EC has sent a statement of objections to the companies," said an EC spokesperson.
"We cannot comment and the process is following its normal course," said Cemex. "Proper disclosure will be made when we have to make it." Cemex had offered some concessions during the EC's preliminary review, but these were not considered to be sufficient. The EC has set a 5 September 2014 deadline for its decision.
UK: Sublime Nature, a new book launched by Cemex UK, became the first in the new Nature Series from global building materials supplier Cemex when it was launched on 18 June 2014. The book has stunning photographs of the natural world and follows the 20-volume Cemex Conservation book series.
Sublime Nature, developed in partnership with National Geographic and Christina Mittermaier, dedicated conservationist and photographer, includes spectacular photographs taken by award-winning photojournalists interspersed with inspiring words from renowned writers and environmentalists. It is aimed at creating awareness of the great beauty of the planet and promoting preservation and conservation.
Jesus Gonzalez, President of Cemex UK, said, "As a leading supplier of cement, aggregates and readymixed concrete, we recognise the need to balance the requirements of the natural world with the demands of communities for building materials to be used in new schools, homes, infrastructure and the built environment. Although recent government announcements have seen a reduction in green objectives, I remain passionate about maintaining sustainability momentum while playing a key role in delivering on our built environment challenges. Our key activities focus on driving down CO2, boosting nature around our operations, developing more sustainable solutions and being more efficient with natural resources."
Colombia: Cemex, via its Colombian subsidiary Cemex Colombia, will launch a new business division called Cemex Energy. The initial objective is to reach energy self-sufficiency and it will also sell any excess energy generated to the national electricity system.
At present, Cemex generates 41MW of energy that covers 65% of its needs, via hydropower (12MW) and thermal and natural gas plants (29MW). Cemex's announcement follows the approval of renewable energy legislation in the country, which allows companies to participate in this area. Cemex added that energy self-sufficiency signifies major savings in relation to market tariffs. It plans to focus on biogas and wind power schemes, potentially requiring investments of US$50m during the next five years.
Dominican Republic: Cemex is carrying out investments of US$22.8m in the Dominican Republic. They include US$18.4m of improvements to its San Pedro de Macoris cement plant and US$4.35m for various activities to strengthen the business. Among the investments will be a waste heat recovery (WHR) system to generate 7MW of electricity, improvements in the calcination system to cut Cemex's carbon footprint, purchases of equipment to increase bagging efficiency by 30% and more trucks to make its concrete mixer fleet the largest of its Caribbean operations at 110 units. Cemex is also involved in housing projects to ease the country's shortage.
UK: Repairs to the flood-damaged Cemex UK cement plant at South Ferriby are said to be making 'good' progress according to Cemex UK. The 0.8Mt/yr plant was flooded by a tidal surge from the River Humber in early December 2013.
Partial production started in April 2014 and a Cemex UK spokesman has reported to the Scunthorpe Evening Telegraph that they plan on resuming full production later in 2014. Repair efforts are now focusing on the kiln systems and the two raw mills and coal mills. Cemex UK has declined to comment on how much the repairs have cost although it is rumoured to have cost as much as Euro14m. The plant employs 150 people and contributes Euro 12.5m/yr to the economy of North Lincolnshire.
Colombia: Cemex is pursuing alternative energy sources, including landfill biogas, wind and solar energy, for its operations in Colombia. It has planned some US$50m of projects for the next five years. The company will look for partners among financial entities and investment funds, according to Edgar Angeles, Cemex's vice president of operations for Central, South America and the Caribbean.
Since the elaboration of Colombia's law on renewable energy, Cemex has been studying projects of this type. The law allows companies to invest in their own power supply and to sell any surplus on the wholesale market. Cemex wants to guarantee 100% of its power supply, compared to 65% now. It already has three small hydroelectric stations and a gas-fired plant in Colombia's Junin, Bucaramanga and Ibague municipalities.
The creation of Lafarge Africa, the clearance of the Cemex West acquisition by Holcim in Germany and the sale of Lafarge's assets in Ecuador all hint at the scale of business that LafargeHolcim will command when it comes into existence. Despite the media saturation of coverage on the merger the implications in developing markets are still worthwhile exploring, especially in Latin American and Africa.
In sub-Saharan Africa, Lafarge is merging its cement companies in Nigeria and South Africa to create Lafarge Africa. Analysts Exotix have described the move as, 'the birth of a leading player on a continental scale'. Indeed, if Lafarge wanted to grow Lafarge Africa to encompass its many other African cement producing subsidiaries it could hold at least 17 integrated cement plants (including plants in north Africa) with a cement production capacity of at least 40Mt/yr in 10 countries and infrastructure in others. That puts it head-to-head with Dangote's plans to meet 40Mt/yr by the end of 2014 through its many expansion projects. Following these two market leaders would come South African-based cement producer PPC with its expansion plans around the continent.
Meanwhile across the Atlantic in Latin America the Lafarge-Holcim merger threatens Cemex. Unlike in Africa where Lafarge has a ubiquitous but disparate presence, Lafarge and Holcim's cement assets are more evenly scattered around the Caribbean, Central and South America. In terms of cement production capacity Cemex and Lafarge-Holcim will both have around 30Mt/yr, with Cemex just in front. The next biggest cement producers in Latin America will be Votorantim (present mainly in Brazil) with just over 20Mt/yr and Cementos Argos (Columbia) with about the same. This includes some new acquisitions in the United States for the growing Columbian producer. In Ecuador Lafarge and Holcim held over 50% of the market share, hence the sale by Lafarge of its assets to Union Andina de Cementos for US$553m.
Depending on how well the merger integrates the two companies, corals the various subsidiaries and implements strategic thinking the merger could just create business as usual with little disruption to the existing order. Yet in both continents the merger has the opportunity to shake up and reinvigorate the cement markets as existing players suddenly discover serious new competition and react accordingly.
Africa has a population of 1.1bn and it had a Gross Domestic Product (GDP) of US$2320/capita in 2013. South America had a population of 359m in 2010 and a GDP of US$8929/capita. This compares to US$27,250/capita in Europe and US$54,152/capita in the US. The economic development potential for each continent is humongous. Post-merger, LafargeHolcim will be first or second in line for some of this potential in Latin America and Africa.
Germany: Holcim has received unconditional clearance by the European Commission (EC) for its proposed acquisition of Cemex West in Germany. The decision follows a detailed Phase II review by the EC. Closing of the transactions is expected for the second half of 2014.
The acquisition in Germany is part of Holcim's strategic portfolio optimisation in Europe that includes a series of transactions together with Cemex, which is separate from the intention to merge with Lafarge.
Holcim said that the decision marks a further milestone towards the optimisation of its strategic portfolio in Europe, which was announced in 2013. It will allow Holcim to create value through an optimised footprint in north-western Germany. It will also allow it to further improve the service and support of existing and new customers.
The transaction includes one cement plant and two grinding stations with a total cement production capacity of 2.5Mt/yr, one slag granulator, 22 aggregates locations and 79 ready-mix concrete plants. They would be combined with Holcim's existing Northern German operations.