Displaying items by tag: CRH

Finland: Miikka Riionheimo has been appointed as the chief executive officer (CEO) of Finnsementti with effect from 1 June 2017. He will replace the current CEO Kalervo Matikainen when he retires. Riionheimo has worked in a variety of roles for Hella since 2004 and also worked for Sandvik. He became the chief operating officer of Finnsementti in 2016.

Philippines: Republic Cement & Building Materials has approved a five-year capital expenditure programme to increase its clinker and cement production capacity to meet local demand. One of the cement producer’s owners, Aboitiz Group, announced that it was making the investment to take advantage of infrastructure development plants by the Duterte administration, according to the Philippines Star newspaper. The upgrade is expected to increase the company’s production capacity by 1Mt/yr from its current level of 7Mt/yr. The investment will be spent on both production efficiency improvements at existing plants and by building a new kiln.

Ukraine: The supervisory board of Podilsky Cement has appointed Leonard Barry as its supervisory board chairperson. Previously, he was the director of CRH in the country, according to the Ukrainian News Agency. Barry, aged 52 years, is an Irish national. He joined Irish Cement in 1989 as a process engineer before becoming its managing director in 2011. He trained as a chemical engineer at University College Dublin and holds an MBA from the University of Limerick.

Other personnel changes include the appointment of Declan Maguire, CRH’s chief operational director for Eastern Europe, as deputy supervisory board chairperson. Alan Connolly has also been appointed as secretary of the supervisory board.

The Philippines has been messing up the balance sheets of cement producers so far in 2017. Over the last week Holcim Philippines, CRH and Cemex have each reported lacklustre first quarter results dragged down by poor performance in the country. CRH’s chief executive officer Albert Manifold seemed to receive the worst kicking when analysts in a conference call refused to let it pass that the company’s sales had dropped by 12% year-on-year in Asia. Although to be fair to him the group’s Asian division only represented 2% of global sales at Euro0.5bn…

CRH’s quarterly financial reports tend to be in the form of sparse trading updates. So this lack of detail and CRH’s plans to invest over Euro300m in the market may have prompted Manifold’s grilling. According to the Irish Times he blamed the situation on cheap imports from south-east Asia pulling down the price. He then defended the investment on the grounds that local producers would have an advantage as they increase production capacity due to constant production and ‘guaranteed’ regulation and certification.

CRH isn’t the only organisation that has been burned by the Philippines. Before Christmas this column was praising the local industry for being in a boom. Cement sales had risen by 10.1% year-on-year to 20.1Mt according to CEMAP data in the first nine months of 2016 and the Duterte Infrastructure Plan was starting to target hundreds of billions of US dollars towards infrastructure spending. In the end cement sales rose by 6.6% to 26Mt for the full year in 2016 and this was a solid performance despite being brought down by the fourth quarter.

From the cement producers mentioned above, Cemex reported that its Ordinary Portland Cement sales volumes fell by 9% in the first quarter. It blamed the fall on bad weather and a tough quarter to compare against in 2015. Holcim Philippines said that its net sales fell by 12% to US$176m and it attributed it to lower public infrastructure spending, tighter industry competition and higher production expenses. Eagle Cement meanwhile, the fourth of the country’s major producers, is preparing to float on the local stock market in May 2017 to fund an expansion drive. The poor results of the other three cement producers may dent its proceeds from the initial public offering (IPO).

The words CRH’s Albert Manifold used in his defence were that, “Brand matters over there.” Funnily enough the other big Philippines cement industry news story that has been rumbling away for the last few months is an investigation by the Philippine Competition Commission (PCC) into the conduct of the Cement Manufacturers Association of the Philippines (CEMAP) and some of the leading cement producers. Naturally this includes CRH’s joint venture Republic Cement. The enquiry was prompted in mid-2016 by the accusation of anti-competitive agreements by a former trade official. He also made direct allegations against Ernesto Ordonez, the head of CEMAP. The investigation is on-going and perhaps it will find out exactly how much ‘brand matters’ in the Philippines.

Philippines: Albert Manifold, the chief executive officer of CRH, has defended his company’s investment of up to Euro350m in the Philippines despite reporting a 12% drop in sales in the first quarter of 2017. Under questioning from analysts in a conference call admitted that about a quarter of cement demand in the country is currently being served by imports from Southeast Asia that is also reducing local prices, according to the Irish Times. However, he insisted that local producers, including CRH, will have an advantage as they increase production capacity due to constant production and ‘guaranteed’ regulation and certification. Manifold also conceded that his company’s performance in the Philippines illustrates the ‘volatility of emerging markets.’

Ireland: CRH’s sales in Asia dropped by 12% year-on-year in the first quarter of 2017. The building materials producer blamed the fall on a slow start to the year in the Philippines due to poor weather, high competition and low prices. No exact figures were provided in the company’s April 2017 trading update.

Overall, across all business lines, the group’s sales rose by 3% on a like-for-like basis. It reported that in the Americas sales were ‘in line’ with the prior year. In Europe sales rose by 6% due to stabilising markets with rises in cement sale volumes noted in Poland, Finland and France. Cement volumes were reported as ‘marginally behind’ in the UK.

Switzerland: Jura Cement’s Wildegg plant has been given permission to extend its limestone quarry at Auenstein and Veltheim. However the decision by the Grand Council is subject to adoption by the local communities, according to Swiss Radio and Television. Jura Cement, a subsidiary of Ireland’s CRH, will also need a building permit for the extension. The cement producer previously had expansion plans for its quarry cancelled in 2014.

Germany: Schwenk Zement has been confirmed as the buyer of Opterra Zement’s Karsdorf cement plant. The transaction remains subject to the Germany competition body and this is expected to take up to six months, according to the Naumburger Tageblatt newspaper. Employees are reportedly ‘concerned’ about the acquisition because Schwenk Zement operates its Bernburg plant in the same state, Saxony-Anhalt. The deal also includes a cement grinding plant.

Germany: CRH has agreed to sell one integrated cement plant and one grinding plant in Germany to an unnamed party. These assets were purchased as part of a group of sites acquitted by CRH from LafargeHolcim in 2015. The transaction is subject to approval by the German Competition Authority (Bundeskartellamt). No exact value for the transaction has been released but the Irish building materials company has placed a sale including these assets and others including a clay business in Northern Europe and a concrete business in Belgium, the Netherlands and Luxembourg for Euro400m. CRH currently operates two integrated cement plants in Germany at Wössingen and Karsdorf.

Ireland: CRH’s sales revenue rose by 4% year-on-year to Euro27.1bn in 2016 from Euro23.6bn in 2015. Its earnings before interest, taxation, depreciation and amortisation (EBITDA) rose by 41% to Euro3.13bn from Euro2.22bn. The group attributed the growth in sales and profits to positive sales in the Americas and Europe and benefits from its first year of full ownership of some assets purchased from LafargeHolcim in 2015.

"2016 was a year of significant profit growth for CRH, with margins and returns ahead of last year in every division. We benefited from positive momentum in the Americas and also in Europe, particularly in the Northern and Eastern regions where we operate," said chief executive Alfred Manifold.

By region, the group’s Europe Heavyside division reported boosts in sales revenue and operating profits. However, its cement operations grew sales volumes in several countries where it faced price pressure and production overcapacity including Ireland, Spain and France. In Germany the group noted that sales volumes grew in its first full year of full ownership due to growth in residential building but that prices remained under pressure. Weak activity in Poland also affected pricing and reduced sales and operating profits.

Outside of Europe, the Americas Materials division also grew its sales and profits. Demand in North American cement markets increased as declines in Western Canada were offset by increases in Quebec and the US. In Brazil it reported that cement consumption fell by 12% in the southeast region and competition remained high. Finally, the group’s new Asia division said that cement demand grew in 2016 due to the private sector and government infrastructure spending. Its operating profit was also boosted by higher prices and lower input cost, including a lowered price of imported clinker. In China the group said that prices fell by due to a poor construction market and production overcapacity.