Displaying items by tag: Cementos Argos
Cementos Argos persists with waste tyres scheme
02 February 2015Colombia: Cementos Argos innovation vice-president Camilo Restrepo has persisted with a project to use waste tyres as an alternative fuel in Colombia. Some 120,000 - 130,000/yr tyres are wasted in Colombia.
Cementos Argos is already using waste tyres as fuel in the US and Honduras and says that the same will be done in Colombia. It put forward its plans to local associations and has been discussing these for five years. Cementos Argos could use 60,000 - 70,000t/yr. Its kilns will have to be adapted at cost of US$5 – 20m each. It will start with its unit in Rioclaro, where tests are underway already. The plant can use 15,000 - 20,000t/yr of waste tyres.
Protests held in Boyaca against cement companies
09 January 2015Colombia: Demonstrations have been held in Boyaca, Colombia by residents from Firavitoba and Tibasosa in order to protest against the operations of cement manufacturers Cementos del Oriente, Cementos Tequendama, Holcim and Cementos Argos. The communities claim that the cement operations are having a harmful effect on their health and are affecting the state of the local roads. Local authorities have agreed to meet with representatives from the communities on 19 January 2015 to discuss the matter.
American focus shifts back north
10 December 2014This week we heard news of two potential bidders for Lafarge and Holcim divestments. However, for a change it was where they will not be bidding that was of interest: Brazil. India's UltraTech Cement and Colombia's Cementos Argos now seem to have no interest in developing their positions in South America's largest cement market, having both previously stated their interest.
The Brazilian assets to be sold are three integrated cement plants and two grinding plants that share a capacity of 3.6Mt/yr (as well as a one ready-mix plant). Cementos Argos came out and said that it would not be bidding. UltraTech's position is more of a rumour, given by 'a source close to the company' that was not revealed by local media. However, both stories suggest that Brazil is currently not a good place for cement producers to buy up assets.
The reasons for these decisions are related to the state of the Brazilian economy, which has seen sub 2% growth in the last 11 quarters. The economy actually contracted by 0.9% in the second quarter of 2014 and by 0.25% in the third quarter of 2014. A 0.2% rise in the fourth quarter will be negated by a fall of 0.28% in the first quarter of 2015. Over the course of 2015 the IMF forecasts growth of 1.4%.
Although Brazilian cement production has risen from around 40Mt/yr in 2006 to around 70Mt/yr in 2013, it has been growing by lower and lower amounts each year. In 2013, it rose by 1.5% year-on-year, down from a 6.7% rise in 2012, an 8.3% rise in 2011 and a near 16% rise in 2010. Taken along with the IMF's GDP growth forecast, there is a genuine chance that Brazilian cement sales could plateau in 2014 or 2015. There will certainly be better places to try to sell cement over the next couple of years, hence the eagerness with which Cementos Argos declared its position.
One country that Cementos Argos has said it's looking at Lafarge and Holcim assets in is Mexico. Its economy is anticipated to grow by 3.5% in 2015, more than twice as quickly as Brazil and far more than the Americas as a whole (2.2%). Another anticipated strong performer in 2015 will be the US (3.1%), where Cementos Argos acquired assets in 2013. This week also saw the news that the Portland Cement Association's 8.1% cement consumption forecast for 2014 will be met.
Taking this all together, it appears that economic growth, and hence cement demand growth, will return to North America in earnest in 2015. Meanwhile South America's largest market is starting to lag behind. How will the rest of the two continents fare in 2015 and beyond?
Brazil: Colombia's Cementos Argos has decided not to 'do battle' for cement-sector assets in Brazil that currently belong to the European giants Lafarge and Holcim. The Colombian multinational has informed the Superintendencia Financiera that it does not see such a purchase as being likely to generate the value its investments would expect.
Thus, Argos puts an end to three months of expectation regarding a possible debut in Brazil for the company. The assets in Brazil's Sudeste region are up for grabs so that the merger can meet with anti-monopoly requirements and amount to some US$1bn. Argos had been in consultation with local financial giant Itau concerning a possible bid. The Colombian cement group's foreign eye will most likely focus now on Mexico, another nation mentioned fondly by company president Jorge Mario Velasquez.
Colombia: Cementos Argos plans to use more than 26,000t/yr of used tyres generated in the Valle de Aburra region as fuel for its cement plant. Tyres could be incorporated in Cementos Argos processes by the end of 2014 or the beginning of 2015. Executives have commented that one of the main obstacles is the collection of used tyres.
Argos gets green light to access more cash
08 October 2014Colombia: Directors at Cementos Argos have given the green light for an ordinary bond issuance of up to US$495m to be used as working capital and to swap financial liabilities. The company will have three years to carry out the issuance, although it will most likely do so in the coming months.
Previous issuances by Cementos Argos, such as those carried out in 2012 to raise US$495m, have helped the firm expand in Colombia, Latin America and the United States. Argos revealed in August 2014 that it is considering buying Holcim and Lafarge assets in the region, particularly Mexico and Brazil, and has announced that it will also build a US$450m plant.
Cementos Argos assesses US$1bn of LafargeHolcim assets
01 October 2014Colombia/Brazil: Colombia's Cementos Argos, part of Grupo Argos, is reportedly assessing assets worth US$1bn that Lafarge and Holcim will be forced to sell in Brazil as part of their planned merger.
Argos, which is working closely with Banco Itau BBA in terms of potential Lafarge-Holcim acquisition deals in Brazil, aims to grow organically and via acquisitions across the Americas. The firm wants to have a presence in markets where there is potential for cement consumption per capita to grow. Cementos Argos already operates nine cement plants in Colombia, three in the United States and one in Honduras.
Cementos Argos to boost Colombian capacity with new 2.3Mt/yr line
16 September 2014Colombia: Cementos Argos plans to expand its Sogamoso cement plant, located in the Boyacá department of Colombia, with a new 2.3Mt/yr line, involving an investment of US$450m.
The strategic location of the Sogamoso plant will enable Cementos Argos to serve the Bogota market as well as growing demand in the centre of Colombia, where around 70% of cement consumption for the country's infrastructure plant will be concentrated. As well as Bogota, the location of the plant allows for efficient access to the Eastern Plains, Santander and North Santander.
"This investment reflects our confidence and commitment to the development of Colombia," said Jorge Mario Velásquez, Argos' CEO. "Factors such as institutional and regulatory strengthening for infrastructure development; the important 4G projects for more than US$25Bn and greater resources for housing development, will drive the growth in cement consumption in the next few years. As a Colombian company, we are committed to assisting the country in its development."
The new project will boost Argos' installed capacity in Colombia from 9.5Mt/yr to 11.8Mt/yr, an increase of 24%. Completion of the Sogamoso expansion is scheduled for 2018. Argos said that up to 40% of fossil fuels would be replaced with alternative fuels. Water and fuel consumption will be 24% and 18% lower than at standard plants, respectively, while emissions of particulate matter will be 67% below the national limit. Cementos Argos will also invest in developing the local community's educational infrastructure.
"The intensive infrastructure programmes carried out in neighbouring countries such as Panama, Peru and Ecuador, have propelled the simultaneous decrease in unemployment rates and upsurge in home construction, creating a virtuous cycle to improve people's quality of life, which we wish to see in Colombia," added Velásquez.
Colombia: Cementos Argos has reported an 87% increase in its net profits for the second quarter of 2014. This was driven by the positive behaviour in its main markets, most notably in the US, as well as an organisational excellence plan that has allowed the company to improve efficiency in various aspects.
Corporate earnings before interest, taxes, depreciation, and amortisation (EBITDA) for the second quarter of 2014 rose to US$142m, some 11% more than in the same period in 2013. EBITDA for the first half of 2014 reached US$272m, despite non-recurring expenses of US$20m that mainly stemmed from recent acquisitions. After integrating the cement and concrete assets that were acquired in Honduras, the US and French Guiana, consolidated revenues for the quarter grew by 18%, while cement sales volumes rose by 9.3%.
"The results that were recorded for this second quarter came from a solid demand in most of the geographies in which we operate," said Jorge Mario Velásquez, Argos' CEO. "It is especially satisfactory to see the recovery of profitability in the United States, the successful integration of the company's recent acquisitions and the strategic advantage that Argos draws from the fact that it operates in 12 countries that have dynamic markets and different economic cycles."
In the US its EBITDA generated during this second quarter of 2014 was nearly twice as high as the EBITDA recorded for the whole of 2013. The country's performance was driven by increasing sales volumes during the first half of 2014, with an upturn of 59% for cement dispatch.
In Colombia, cement sales volumes increased by 3% and revenues amounted to more than US$604m for the first half of 2014, which was a result similar to 2013. During this period, Cementos Argos recorded a bigger increase in sales of the bulk cement segment and in concrete dispatching, as well as positive trends in housing construction, thanks to the approval of an increased number of building permits and the continuation of mortgage subsidies.
In the Caribbean and Central American Regional Division, revenues rose by 20% and EBITDA improved by 38% in the first half of 2014, reflecting the positive effect of including the results of the plant in Honduras and of the cement grinding plant in French Guiana.
Sweden/Colombia: Swedish engineering firm SKF has signed a three-year deal with Cementos Argos to provide engineering products and services for its operations in Colombia. SKF will provide everything from bearings, housings and seals to training and application engineering, to support Argos' operations in 10 plants throughout the country. Argos has expanded the scope of the agreement to include seals and more bearing products than SKF had supplied previously.
"SKF has an extensive partnership to support Argos in maximising the utilisation and reliability of its assets, thereby achieving its business objectives," said Vartan Vartanian, President, SKF Industrial Market, Regional Sales and Service. The deal expands SKF's existing contract for maintenance services, mechanical services, reliability engineering services and condition monitoring solutions for conveyors, gearboxes and mills at four of Cementos Argos' plants in Colombia.