02 August 2019
Vicat fights poor markets in Turkey, Switzerland, Indian and West Africa in first half of 2019 02 August 2019
France: Vicat’s sales rose by 4.6% year-on-year to Euro1.34bn in the first half of 2019 from Euro1.28bn in the same period in 2018. This was mainly due to its acquisition of Brazil’s Ciplan in late 2018. At constant scope and exchange rates its sales fell by 0.6% due to poor markets in Turkey, Switzerland, Indian and West Africa. Its earnings before interest and tax fell by 9.4% to Euro97m from Euro107m. Cement sales volumes dropped by 4.9% to 10.8Mt from 11.4Mt and concrete volumes decreased by 6.7% to 4.3Mm3 from 4.57Mm3.
“In the first half of 2019, solid performances in France, Asia and the US drove an increase in our sales and earnings before interest, taxation, deprecation and amortisation (EBITDA). These results reflect a marked improvement in the operational profitability given the on-going increase in consumed energy costs, the deteriorating macroeconomic situation in Turkey and the exceptional rainfalls in California that we experienced in the first half,” said Guy Sidos, the group’s chief executive officer (CEO).
By region, the group’s sales and earnings rose in France but fell in the rest of Europe. Sales grew in the Americas region, even without the Ciplan acquisition, but earnings fell due to a Euro10.6mn settlement payment booked in the US in the first half of 2018. The group’s sales fell in India but earnings rose due to price increases. Poor markets in Turkey and Egypt hit sales and caused a loss.
US: Summit Materials' revenue rose by 3% year-on-year to US$739m in the first half of 2019 from US$717m in the same period in 2018. Its adjusted earnings before interest, taxation, deprecation and amortisation (EBITDA) grew by 4% to US$147m from US$141m. Cement sales volumes increased by 2% to 1Mt from 0.97Mt. Tom Hill, the chief executive officer of Summit Materials, noted that flooding on the Mississippi River had presented ‘significant’ challenges for its cement business during the second quarter of 2019.
Summit Materials is active in the aggregates, asphalt and concrete sectors. It also owns Continental Cement, a cement producer that runs two integrated cement plants at Hannibal, Missouri and Davenport, Iowa.
India: Dalmia Bharat has blamed the general election for its slow cement sales volumes growth in its first quarter. Its sales volumes of cement increased slightly to 4.55Mt. Its revenue grew by 7% year-on-year to US$365m in the first fiscal quarter to 30 June 2019 from US$340m in the same period in 2018. Its earnings before interest, taxation, deprecation and amortisation (EBITDA) rose by 27% to US$95.7m from US$75.2m.
The cement producer also said that its power and fuel costs per tonne had been negatively affected by its Kalyanpur plant operating at low capacity utilisation levels, partly due to a lack of coal. However, it noted that its raw material costs had been ‘moderated’ due to falling slag prices.
Egypt: Medhat Istafanos, the head of the Cement Division at the Federation of Egyptian Industries (FEI), says that the market is only supporting 40% of local production. He blamed this on a slowdown in building activity and a lack of government-backed infrastructure projects to make up the shortfall, according to the Al-Ahram newspaper. Noha Bakr, an executive director at the cement division of the FEI, also blamed a construction ban on agricultural land.
The country’s 24 cement plants have a production capacity of 85Mt/yr but only 48Mt were sold in 2018. Cement sales have fallen since 2017 and are expected to reach 49Mt in 2019.
Producers are exploring options to increase cement exports. Walid Gamaleddin, the president of the Export Council for Building Materials and the Metallurgical Industries, has called for the government to support industry exports. The minister of trade and industry discussed a programme for cement-export subsidies with officials from the sector in late July 2019 that would include encouraging agreements to export cement to the African countries. The Central Bank of Egypt (CBE) has also instructed the banking sector to support cement companies that needed to restructure their debts. The merger of smaller companies to form larger conglomerates has also been encouraged.
However, growing exports of Egyptian cement is challenged by its relative high cost compared to other countries. Istafanos said that Egyptian cement is US$12/t higher than its competitors.
Association of Cement Manufacturers of Andalusia calls on government to increase infrastructure projects 02 August 2019
Spain: The Association of Cement Manufacturers of Andalusia (AFCA) has lobbied the Regional Government of Andalusia to invest more in infrastructure projects. At a meeting the cement producers asked the local government to support the sector, according to Europa Press. The region’s consumption of cement grew by 8.5% year-on-year to 2.5Mt in 2018 but it is still at a historically low level. Exports fell by 30% to 1.6Mt in 2018 due to rising costs associated with the European Union Emissions Trading Scheme and high local electricity costs.
Cemex Mexico launches concrete sales website 02 August 2019
Mexico: Cemex Mexico has launched a new website to sell concrete. It is intended to serve builders, contractors, small business owners, architects, construction entrepreneurs and the general public for any size of project from 1m3 upwards.
The site includes an online calculator to help customers work out the amount of concrete required for a project and technical support to aid the transaction. It also supports scheduling delivery at a specific time and date, as well as having visibility and tracking of the order in real time. The company says it is the first conle concrete sales channel in the country with ‘express’ service and full coverage.
Mississippi Lime completes acquisition of Southern Lime 02 August 2019
US: Mississippi Lime has completed its acquisition of Southern Lime, the lime business of Covia based in Calera, Alabama. The purchase increases Mississippi Lime’s production facilities to nine locations, supported by a network of distribution sites throughout the country. The Southern Lime business and its Calera plant will be fully integrated into Mississippi Lime. No value for the transaction was disclosed.