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Holcim announced yesterday a shock profits warning after it included Euro641m in one-off charges in its 2011 accounts. Over half of this amount, a massive Euro343m, came from writedowns at its former South African subsidiary AfriSam, which has been unable to deal with poor trading conditions there. Writedowns in the US and parts of Europe made up the rest of the one-off costs. The move has prompted fears from analysts that other cement manufacturers may follow suit, taking the sector into unknown territory. What other skeletons are hiding in the cupboards of the big multinationals?

Meanwhile, an old cement industry problem that is not unfamiliar to AfriSam, cartelisation, has reared its ugly head again. After five Spanish producers were ordered to pay a combined Euro11.1m over an alleged cartel in northern Spain, authorities in Pakistan searched the offices of its national cement association, the APCMA, on Monday. They were following a tip-off that cement companies have been monitoring each others' dispatches, a practice deemed illegal in previous investigations. A previous cartel case from 2009-2010 is still pending in Pakistan so any action against producers will likely to take years to be brought.

Elsewhere, the situation has gone from bad to worse at the East Africa Portland Cement Company in Kenya, with protests over the re-instatement of previously-fired board members turning violent on Monday. With one worker hospitalised after being shot by an over-zealous security guard, it is hard to see how the current situation can be resolved without the removal of the current management. The government has assured the workers that it is working on the problem.

At the same time in Kenya, National Cement Company's (NCC) plans to build a quarry and clinker plant south of Nairobi have been slammed by local Massai groups, environmental NGOs and even the state-owned Kenya Wildlife Service. NCC plans to 'buy-off' the Massai with a jobs scheme, but this doesn't address the conservation issues. Global Cement urges NCC to re-examine its plans and the location of its proposed plant, and to work closely with the Kenya Wildlife Service.

The Spanish cement producer Cementos Portland Valderrivas has approved the nominations of Juan Bejar and Jose Manuel Burgos as board members. Bejar currently occupies the post of executive chairman at domestic motorway operator Globalvia and Burgos is a vice-chairman at the real estate firm GMP. They will replace Rafael Martinez-Ynzenga Canovas del Castillo and Feliciano Fuster.

UK: A worker was killed in an industrial accident at the Cemex plant in Rugby in the early hours of this morning.

A spokesman for the plant confirmed that a man working for a sub-contractor was killed at the plant and emergency services attended the scene. Police officers and the Health and Safety Executive are currently at the site investigating what happened. Another man suffered a broken arm in the incident and had to be taken to hospital for treatment.

Cemex community affairs manager Ian Southcott said, "Regrettably one person has died and our thoughts and sympathies are with their family and friends. Cemex is cooperating fully with all of the investigations taking place." Southcott refused to reveal any more details about the accident while investigations are on-going.

The cement plant is currently in its annual shutdown period for regular maintenance. There are a number of contractors working on the site as a result. In December 2011 Cemex was fined for a worker's death in 2008 at the same plant.

Kenya: The activism of local Massai groups and environmental NGOs is preventing the National Cement Company from installing its clinker plant south of Nairobi.

Narendra Raval, head of the National Cement Company Ltd (NCC), known as 'Guru', is facing stiff resistance to installing a clinker plant south of Nairobi and operating limestone quarries. His company has acquired land from the local county council to build its second cement plant in the country, but environmental NGOs are opposed to this project. Massai groups are doing likewise, saying in their case, that the land belongs to them. The strongest resistance comes from state-owned Kenya Wildlife Services (KWS), which argues that the land should remain a migration corridor for wildlife between the national parks of Amboseli and Nairobi.

A subsidiary of the Devki Group (which is also the parent of DevkiSteel Mills), NCC argues its case by promising to reserve 200 new jobs for Massai youth.

Pakistan: The Competition Commission of Pakistan (CCP) has conducted searches and inspections at the premises of the All Pakistan Cement Manufacturers Association (APCMA) and Kohat Cement in Lahore under Section 34 of the Competition Act 2010. It said that it carried out the searches to look for proof of suspected cartelisation in the cement sector.

According to a statement issued by the CCP, it had obtained information from an informant that contained copies of certain e-mails that had been sent by the Secretary of APCMA to cement manufacturers. The contents of the e-mails provided by the informant revealed that the cement manufactures had prima facie collectively devised a vigilance plan by which the cement dispatches at one cement production unit are monitored by a team of another unit and vice versa.

Such monitoring of cement dispatches was previously recognised as an integral part of a collusive arrangement among the cement manufacturers. The CCP has declared such arrangements to be in violation of Section 4 of the Competition Act 2010. It imposed a penalty of nearly US$700m on the APCMA and its members. This matter has been taken to court and is still pending.

The fresh probe by CCP was based on a separate set of facts that suggested that the cement manufacturers have again formed a collusive arrangement and to ensure compliance the monitoring function is being performed by cement manufacturers themselves under the auspices of APCMA. When the CCP search and inspection team arrived at the APCMA premises, it discovered that the APCMA secretary was not present in the office and all the records were locked. After initial hesitation the APCMA allowed the CCP to access the data. A search and inspection was also carried out at of the office of the APCMA President, who is also the Chief Executive of Kohat Cement.

Local media has long speculated that cartelisation was in place in the cement sector based on rapid cement price increases in recent months. Pakistan's cement capacity utilisation also dropped to a 10-year low of 69.7% in the six months to 31 December 2011. "The expected turn around in the economy did not materialise because the capacity of the sector continued to increase," said a spokesman from the APCMA, commenting before the CCP inspections were made. He said that expansions in the cement sector had been planned several years ago when the economy had been in a far better situation.

Spain: Spain's competition watchdog CNC has imposed a fine of Euro11.1m on five cement companies, namely Cementos Portland, Beriain, Cetya, Vresa and Cemex España, which have been accused of setting up a cartel in northern Spain.

Cementos Portland was ordered to pay Euro5.72m, followed by Beriain with a Euro2.5m fine. Next came Cetya and Vresa with fines of Euro1.14m and Euro0.96m respectively. Cemex España will be forced to forfeit Euro0.5m.

South Korea: South Korea's cement exports reached an all-time high in 2011 as domestic manufacturers turned their eyes overseas amid a deepening domestic property slump.

The Korea Cement Association (KCA) said that South Korean cement manufacturers exported a total of 4.49Mt of cement in 2011, up a massive 62% from the 2.77Mt exported in 2010. The total amount of clinker and cement exported by South Korea rose to 9.97Mt, surpassing the 2010 record of 7.53Mt.

The KCA said that the long-running slump in the local construction market had forced its domestic companies to make inroads into overseas markets and diversify their business portfolios. "Cement makers sought to sell their products in overseas markets because the local demand for cement was so low," said an official from a local cement manufacturer.

India: Dalmia Cement Bharat Ltd. (DCBL), a subsidiary of Dalmia Bharat Enterprises, has picked up a 50% stake in Assam-based Calcom Cement India (Calcom) for an investment US$47m. Calcom is in the process of expanding its consolidated cement manufacturing capacity to 2.1Mt/yr.

Amit Chaudhery, group corporate communications at Dalmia Bharat Group, said, "DCBL has arrived at an in-principle agreement with Assam-based Calcom Cement for a 50% stake in that company. Calcom Cement has a robust presence in markets of the northeast. The 50% ownership of this 2.1Mt/yr semi-commissioned plant is the first concrete example of the non-organic, acquisition-based growth strategy of DCBL."

DCBL's move is part of its larger aims to expand its cement business to northern and northeastern. Dalmia has 9.5Mt/yr capacity and holds little over 45% in Orissa Cements, which has a capacity of around 5.5M/yr. The company is also looking to set up two greenfield plants in Karnataka with a capacity of 2.5Mt/yr each.

US: Four Roanoke Cement Company distribution terminals have achieved the US Environmental Protection Agency's Energy Star Challenge for Industry, which recognises plants that demonstrate a commitment to the environment by achieving a 10% reduction in energy intensity within five or fewer years.

"This achievement was the result of a supreme team effort," said Don Ingerson, VP of Cement and Aggregates, Sales and Marketing at Roanoke Cement, "The focus on reducing energy by each and every one of our people at the terminals is an excellent example of our commitment to continuous improvement. With that, our energy management knowledge continues to grow as we share it with our customers and our community."

The recognised operations include terminals in Richmond, Front Royal and Chesapeake (all in Virginia) and Castle Hayne, North Carolina. The average energy intensity reduction for all four terminals was 21.76%. "We are proud that these four facilities are the first to be awarded among the cement sector," stated Steven Drzymala, Energy Systems Engineer with Titan's Corporate Engineering Department. "This is a great achievement."

Switzerland: Holcim surprised investors with a profit warning today, after announcing it would take a Euro641m hit in one-off charges on its 2011 accounts. The bulk of the impairment relates to a Holcim-specific issue in South Africa regarding AfriSam but analysts noted the decision to write down the value of assets in parts of Europe and the US on the back of sharply lower demand could be echoed by other cement makers.

"Some mature markets will never again see the record levels of profitability of the mid-2000s. Other players could be forced to do the same," warned Josep Pujal of Kepler Capital Markets.

Euro343m of Holcim's charges stemmed from completely writing down its remaining South Africa investment following a steep fall in demand for construction materials in the country since 2010. Holcim's South African exposure stems from its former local subsidiary, the country's biggest cement maker by sales, AfriSam. The remainder of the write-offs stem from adjusting property, equipment and goodwill lines in the group's accounts to much weaker markets. Some Euro271m in writedowns related to Spain and eastern Europe and Euro26m related to the US.