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Anhui Conch chooses grinding aid supplier for 2019 14 February 2019
China: Anhui Conch has chosen Conch New Materials, a fellow subsidiary of Conch Holdings, as one of its grinding aids suppliers for 2019 following an open tender process. The value of the deal is estimated to be worth no more than around US$125m for no more than 0.15Mt of cement grinding aids. Conch New Materials develops, produces and sells cement additives, concrete admixtures, related chemical products and technical services. The other supplier has not been named.
ThyssenKrupp details new leadership structure for new companies 14 February 2019
Germany: ThyssenKrupp has announced the leadership structure of its two future companies: ThyssenKrupp Industrials and ThyssenKrupp Materials. At each company the number of board directorates will be reduced to three and central functions will be combined.
From 17 corporate and service functions at present, there will be 14 at ThyssenKrupp Industrials and 10 at ThyssenKrupp Materials. The current matrix structure will be dissolved. In the future there will be no regional structure besides the business areas at headquarters level. The tasks in the regions will be performed by the operating units or central functions. The shared service units will also be allocated according to business requirements and focused more closely.
“With the separation we will create strategic clarity and enable the businesses to develop more dynamically. The new leadership structures are key to this. The new set-up is tailored to business requirements and reflects the different market requirements. Both ThyssenKrupps will become leaner, faster and better,” said Guido Kerkhoff, chief executive officer (CEO) of ThyssenKrupp.
ThyssenKrupp Industrials will comprise the elevator, automotive, and plant engineering businesses, including manufacturing equipment for the cement sector. ThyssenKrupp Materials will operate in the materials sector.
ThyssenKrupp will take a final vote on the separation plans in January 2020. The composition of the two management teams will be decided in spring 2019. Details of the financial structure, brand identity and strategy of the two new companies will be announced in May 2019. Both companies are to commence operations at the start of the company’s next financial year on 1 October 2019.
Cemex in 2018
Written by David Perilli, Global Cement
13 February 2019
Cemex was the first of the big multinational cement producers to release its fourth quarter results this week. Revenue, sales volumes of cement and gross profit were all up in single digits. Earnings growth was less impressive, with operating earnings before interest, taxation, depreciation and amortisation (EBITDA) rising by 1% year-on-year on a like-for-like basis to US$2.56bn in 2018. This was a decrease of 1% in real terms. Cemex blamed this on rising energy costs and on lower earnings from its territories outside of Mexico and the US.
Figure 1: Breakdown of Cemex’s net sales in 2018 by region: Source: Cemex.
As Figure 1 shows, over three quarters of Cemex’s sales come from Mexico, the US and Europe. Elsewhere its presence is smaller but it does have plants in key countries like the Philippines and Egypt. The former, for example, saw its cement sales rise by 7% in 2018 bringing along the rest of the Asia, Middle East and Africa region into volume growth.
Some other non-financial results to consider lead with the good news that 2018 was the first year ever that Cemex has had without any employee fatalities. This probably doesn’t include contractors or third parties, we’ll have to wait for the next sustainability report to find out for sure, but this is undoubtedly a milestone. Another point of interest was the growth of Cemex Go, its online sales platform. In 2018 it was responsible for around 40% of the company’s sales volumes. Around 85% of its recurring clients use it and it has nearly 30,000 customers. The analytics alone from the system and the potential for further tailoring it towards both customer and company objectives sound promising. Lastly, Cemex was also keen to note its alternative fuels substitution rate of 27% in 2018.
In recent years the other metric that the analysts have been watching is Cemex’s debt. It dropped by 8% year-on-year to US$10.4bn in 2018 compared to a high of US$17.5bn in 2013. Its plan is to reach an ‘investment-grade’ balance sheet by 2020.
In this way Cemex has been ahead of the curve of the major European cement multinationals like LafargeHolcim and HeidelbergCement that have taken on ‘indigestible’ acquisitions more recently. Possibly behind all of these companies is CRH, which has steadily been growing in recent years through acquisitions. It made the headlines this week on the corporate side when Swedish so-called ‘activist investor’ Cevian bought what is thought to be around a 3% stake in the Irish company. The financial press thinks it’s after a seat on the board to try and influence CRH to focus on margins rather than its acquisition strategy. CRH’s EBITDA margin was 12% in 2017 compared to 23%, 19% and 19% for LafargeHolcim, HeidelbergCement and Cemex respectively. This is just one way of comparing these companies. CRH, for example, might be keen to promote how its other metrics like cash generation and return on capital employed perform compare favourably to its competitors.
The point though is that it has taken Cemex over a decade since its acquisition of Rinker to rebuild its finances. All being well, it stands ready to take advantage of whatever the cement market holds in the 2020s.
Janusz Miluch appointed as chief executive officer of Cement Ożarów
Written by Global Cement staff
13 February 2019
Poland: Cement Ożarów has appointed Janusz Miluch as its chief executive officer (CEO). He succeeds Andrzej Ptak, who retired at the end of December 2018, according to Wirtualny Nowy Przemysl.
Guillermo Rojo de Diego appointed general manager of Trinidad Cement
Written by Global Cement staff
13 February 2019
Trinidad: Trinidad Cement has appointed Guillermo Rojo de Diego as the general manager. He succeeds Rodolfo Martinez, who held the position from mid-2017. Martinez will take up another role with Cemex, the owner of Trinidad Cement.