Displaying items by tag: GCW53

France: Lafarge intends to cut its costs by Euro1.3bn from 2012 to 2015. The French-company announced that it is speeding up cost-cutting measures, boosting sales revenue and cutting net debt over the next four years in a bid to improve its profitability.

At least Euro400m of cost savings are scheduled for 2012 and at least Euro350m are planned for 2013. The plan seeks to raise Euro450m from innovation and efficiency gains and boost earnings before interest, taxes, depreciation and amortization (EBITA) by Euro1.75bn. As a result of the higher EBITDA, Lafarge will cut its net debt below Euro10bn 'as soon as possible' in 2013.

The company seeks to boost return on capital employed to above 8% by 2015.
"All our actions will contribute to higher cash generation, improved returns, and cash flow from operations to net debt of 28% to 30% no later than 2015," Lafarge said in a statement.

Lafarge has struggled over the past few years from its heavy debt load and the global economic downturn. Its debt peaked at Euro17bn in 2008, following a series of acquisitions culminating in the Euro8.8bn takeover of Egyptian rival Orascom Cement. The company had already managed to reduce its debt to Euro12.36bn at the end of the first quarter of 2012.

Lafarge Chief Executive Bruno Lafont reiterated the company will raise Euro1bn in asset sales in 2012 and doesn't plan any major acquisition over the coming years. He added that the company's ultimate goal is to raise dividends and resume investing once its financial structure is stabilised.

Vietnam: The Vietnamese minister of construction has claimed that the master development plan for the country's cement industry from 2011 to 2020 approved by the Prime Minister is still in line with market movements and that there is no 'cement crisis' in the country.

Trinh Dinh Dung said that Vietnam consumed 55Mt out of 64Mt of cement produced in 2011, with consumption accounting for 89% of production. "I confirm that there is no cement crisis caused by the development scheme as raised by some people," said the minister.

The country currently has a huge cement surplus given its low domestic consumption. Under a policy of public spending cuts, the amount of construction work is actually falling, pushing down consumption of building materials.The country is forecast to use 55-56Mt of cement in 2012, accounting for just 80% of its own output. "We can't say that the cement development plan triggers an oversupply crisis," said Dung.

One of the biggest questions is why the country still imports cement when it faces huge inventories. The minister explained the country must stick to local commitments that stipulate that ASEAN members cannot impose import bans or tariff barriers on cement. Furthermore, market forces also prompt cement imports, he said.

Cement is mainly produced in the north of Vietnam, resulting in high cement prices in the south due to transport fees. Sometimes, the price of local products gets higher than that of products imported from Thailand.

"In a market economy, the country must import goods from overseas markets at competitive prices if domestic production shows low efficiency," said the minister.

Canada: Politicians and community leaders were on hand yesterday to celebrate the fact that St Marys Cement's Bowmanville Plant has received North America's first International Organisation for Standardisation's (ISO) ISO 50001 certification.

Erik Madsen, CEO of St Marys Cement Inc. accepted the certificate at a ceremony at the plant. The award presentation was made by Michael Delisle, CEO of International Certification Services Inc. (ICS). Although the ceremony was official recognition of the plant had achieved certification the company was officially registered as the first North American recipient of ISO 50001 on 15 November 2011.

Upon receiving the Certificate, Madsen observed, "St Marys identified the benefits and embraced the certification process early. The ISO 50001 programme and cement plants are a logical fit. Our Bowmanville plant has a rated capacity of over 1.8Mt/yr of product, operates 24/7 and consumes significant amounts of energy. Managing these energy costs is a no brainer. it is good for the environment and our bottom line."

Fabio Garcia, Operations Manager at the Bowmanville Plant, told ceremony attendees, "Receiving this prestigious certification was not something that happened overnight. The origins of this certification can be traced back to 2005 when we were given the green light by senior management to move forward with an integrated strategy to reduce the plant's energy consumption.  This quickly became an initiative supported and made possible by all of our employees."

CEO Madsen concluded, "The  commitment to energy conservation, and the continual desire to improve processes by the entire staff at our Bowmanville plant,  is the reason that this is the first North American site to receive ISO 50001 certification. The energy conservation elements of ISO 50001 certification means we are on track for over US$1m in savings in 2012 alone.  I want to thank each and every one of our employees, who helped to make this possible."

Ethiopia: In what would be its maiden overseas venture, India's Birla Corp has announced plans to set up a cement plant in Ethiopia. The MP Birla group company has recently formed a wholly-owned subsidiary, Birla CorpCement Manufacturing plc, in Ethiopia to establish a plant.

"We plan to go there for exploration of limestone to set up a cement plant," said a Birla Corp official. "We would also explore opportunities to set up power plants there."

While Ethiopia is economically poor it is endowed with significant limestone deposits. Cement companies have started eyeing projects in the country after the government started facilitating the import of coal. The country currently imports cement because local demand far outstrips supply and acute power shortages keep new investments away.

This is not the first time that Birla Corp has tried to enter the Ethiopian cement market. In 2010 it made a contract bid for the construction of a cement plant at Habesha but lost out to Chinese competitors. Chinese mining companies have taken up extensive limestone mining contracts in Ethiopia in recent years, firming up long-term off-take contracts.