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With the annual results for 2012 in from Lafarge, Holcim and CRH we now return to look at how the European markets coped.

Holcim summed up the mood perfectly in its media release on its annual results for 2012. First it pushed the big positive (net sales up overall) but then finished its first (!) sentence with: '...despite the difficult economic environment in Europe.'

Overall in Europe, Lafarge saw its cement volumes fall by 9% to 29.6Mt from 32.5Mt. Notably sales volumes fell significantly in Spain and Greece, by 26% and 37% respectively.

Holcim saw its cement volumes fall by 2% in Europe to 26.3Mt from 26.8Mt. There were specific country figures from Holcim but it did comment that the 'severe crisis' in southern Europe had 'contaminated' economies further north such as a France, Benelux, Germany and Switzerland.

CRH was less candid about its cement business in Europe although it did report that its sales revenues fell by 10% to Euro2.69bn in 2012 from Euro2.99bn in 2011. Notable losses occurred in Poland (11% volume decline), Ireland (17% decline) and Spain (30% decline).

These figures compare against a 4% decline in volumes in Western and Northern Europe to 22.1Mt from 21.3Mt by HeidelbergCement, a 13% drop in overall net sales to Euro3.05bn in Cemex's Northern Europe section and a 16% drop in volumes to 16Mt from Italcementi in its Central Western Europe region.

The question to ask at this point is how HeidelbergCement and Holcim managed to suffer smaller losses compared to everybody else. Less exposure to southern Europe is one answer. Depressingly though they both suffered similar drops in profit indicators such as earnings before interest, taxes, depreciation, and amortisation (EBITDA) to the others (20% and 33% respectively).

Both Holcim and CRH are expecting continued tough conditions in Europe in 2013. However, both companies are mildly optimistic that the worst has passed, with talk of the work of the European Central Bank supporting peripheral Eurozone economies showing some effect. Lafarge doesn't even mention Europe in its outlook.

As mentioned in Global Cement Weekly #87 on 13 February 2013, EU regional GDP growth is forecast to become positive in 2013. Everybody is going to be watching the European quarterly results for the cement majors in 2013 very carefully indeed. In the meantime all every cement producer with a presence in Europe can do is to carry on cutting costs.

Ireland: Myles Lee, the Group Chief Executive of CRH, has confirmed to the board that he intends to retire from the company at the end of 2013 having reached the age of 60. CRH has indicated that it was likely that Albert Manifold, CRH's CEO, would become the new chairman.

Lee has completed a five year term as chief executive and 10 years as an executive director. Lee joined CRH in 1982, joining the board in November 2003 as finance director, later becoming chief executive in January 2009.

India: JK Lakshmi Cement Ltd has informed the Bombay Stock Exchange that Shri Hari Shankar Singhania, chairman of the board of directors of the company and president, JK Organisation, passed away on 22 February 2013 at the age of 80.

Colombia: Growth in cement and concrete sales has helped Colombia's largest cement firm, Cementos Argos, to increase its 2012 profits by 5.9% to US$218m, the company has announced in a financial statement.

Overall revenue was up by 23% to US$2.44bn in 2012 compared to 2011. Earnings before interest, taxes, depreciation, and amortisation (EBITDA) rose by 29% to US$440m. Cementos Argos increased its cement sales by 6% to 10.8Mt in 2012. In the company's Colombian division cement sales rose by 2% to 5.1Mt. In the US division cement sales rose by 13% to 1.6Mt. In its Caribbean division cement sales rose by 21% to 2.8Mt.

"There was a positive trend towards accelerated growth in segments in both infrastructure and construction in general," said the statement.

Switzerland: Swiss-based multinational building materials producer Holcim has reported a 2.5% rise in cement sales to 148Mt in 2012 from 144Mt in 2011. In its media release Holcim mentioned that the increase came, 'despite declines in the European businesses.'

Holcim's net sales rose by 6.4% to Euro17.9bn in 2012 from Euro16.8bn in 2011. Operating earnings before interest, taxes, depreciation and amortisation (EBITDA) rose by 3.1% to Euro3.30bn from Euro3.20bn. However, operating profit fell by 3.7% to Euro1.51bn from Euro1.57bn.

In cement deliveries were up in all major group regions except Europe, where only Russia and Azerbaijan posted significant increases in sales, partly also in connection with capacity expansion.

By region, Holcim singled out its Asia Pacific as its 'key growth' area. Sales of cement rose by 5% to 79.2Mt from 75.6Mt. Total net sales rose by 9% to Euro5.47bn from Euro5bn. Thailand and the Philippines were singled out as performing well, while Australia turned in a 'less dynamic performance than in 2011.'

In Latin America sales of cement increased by 3% to 24.9Mt from 24.2Mt. Total net sales rose by 9% to Euro2.29bn from Euro2.11bn. Amidst positive performance in most countries, Argentina witnessed a 'significant' downturn in 2012.

In Europe sales of cement fell by 2% to 2.3Mt from 2.4Mt. Total net sales fell by 3% to Euro2.16 from Euro2.23bn. As Holcim's annual report put it, 'the severe crisis dogging Southern Europe contaminated other countries, also affecting hitherto relatively stable economies such as France, the Benelux states and Germany, with repercussions for Switzerland'. Only Russia and Azerbaijan avoided this.

In North America sales of cement rose by 5% to 12Mt from 11.4Mt as the US economy recovered. Total net sales rose by 13% to Euro1.13bn from Euro1.01bn.

In Africa/Middle East sales of cement fell by 4.4% to 8.4Mt from 8.7Mt. Total net sales fell by 1% to Euro697m from Euro706m. Here, performance was impacted upon by the 'political uncertainties in North Africa and the civil war in Syria.'

In its outlook for 2013 Holcim anticipated an increase in sales of cement in 2013, led by its Asia Pacific, North America and Latin America regions. Margins are expected to improve as its cost saving programme, the 'Holcim Leadership Journey', continues.

Ireland: Irish building materials supplier CRH has reported a loss before tax of 5% to Euro674m in 2012 from Euro711m in 2011. Chief executive Myles Lee pinned the blame on weakening consumer and investor confidence within the Eurozone, although this was tempered by the recovering US market.

The group's sales revenue rose by 3% to Euro18.7bn in 2012 from Euro18.1bn in 2011. Earnings before interest, taxes, depreciation and amortisation (EBITDA) remained flat at Euro1.64bn compared to Euro1.66bn.

By region, CRH's Europe Materials division, which includes cement production, saw its sales revenue fall by 10% from Euro2.99bn to Euro2.69bn. EBITDA fell by 7% to Euro405m from Euro 436m. However, CRH's cement production volumes increased in Ukraine by 32% due to a new cement plant and an acquisition in Odessa. Ireland and Spain only comprised 5% of the division's EBITDA. Ireland saw a 17% decline in cement volumes and CRH declined to present any data about Spain other than a 30% decline across 'all sectors.'

America Materials saw its sales revenue increase by 13% to Euro4.97bn from Euro4.40bn. EBITDA increased by 7% to Euro566m from Euro530m.

In its outlook CRH expects its American operations to make progress in 2013, fuelled by the continued recovery of the US economy. Its European forecasts suggest only modest growth at best for 2013. American improvements and further profit improvement initiatives are expected to outweigh continued trading pressures in Europe.

India: Indian cement producers are poised to pass on a 5.79% increase in the freight rate to consumers following the Railway Budget. However a cement producer quoted by the Press Trust of India said that a final decision would be taken after the Union Budget.

"With the hike in freight charges, the impact will be US$2.41/t - US$2.78/t of cement production," said Shree Cements managing director H M Bangur.

An analyst tracking the cement industry said that cement makers never absorb the hike in freight costs and these are always passed through. In the budget Railway Minister Pawan Kumar Bansal raised the freight charges for cement, diesel, LPG, steel and iron-ore by up to 5.8%.

Nigeria: Edo Cement Company's new US$500m plant in Okpella, with a cement production capacity of 3Mt/yr, will be ready for commissioning in early 2014, the chairman of parent company BUA Group has said.

Alhaji Abdulsamad Rabiu made the announcement at the signing of a US$35m contract agreement between BUA Group and Siemens to build a new gas turbine power plant for the plant. The contract, which was signed with Siemens at BUA's London office, was for Siemens to supply three SGT 500 turbines manufactured by Siemens Industrial Turbo Machinery AB in Finspang, Sweden with a total capacity of about 45MW. These will supply power to the Edo Cement plant, which is currently under construction.

"I am particularly very impressed so far by the civil construction work done by Julius Berger. 70% of the cement plant equipment has been shipped and is currently on site and the pace of work is very comprehensive and impressive. By early 2014 the cement factory will be ready for use," commented Rabiu on the plant's progress.

South Africa: Sephaku Holdings, the listed company with a 36% shareholding in Sephaku Cement, has nearly doubled its headline loss to US$1.11m in the six months to 31 December 2012 compared to US$0.63m in the same period of 2011. However, the company is in a strong cash position according to CEO Lelau Mohuba.

Sephaku Cement plans to commission a clinker plant towards the end of the 2013, which will produce 2.5Mt/yr of cement. It is 64%-owned by Nigeria's Dangote Cement. Mohuba said the commissioning was on schedule and that Sephaku would become a major player in the South African cement market, which currently produces 14Mt/yr.

Meanwhile shareholders have approved the acquisition of Metier Mixed Concrete on 11 January 2013. The company concluded a 10 year funding agreement deal valued at US$220m with Standard Bank and Nedbank in October 2012. Sephaku's directors said this agreement would close the gap in terms of the capital they would require for Sephaku Cement to be fully prepared for market entry and for it to become a significant competitor in the wholesale and retail cement trade.

Dangote has, according to reports, invested more than US$124m in the cement venture at Aganang, near Lichtenburg in North West Province, making it the largest foreign direct investment in South Africa by a company from elsewhere in Africa.

Croatia: Croatian building materials producer Nexe Grupa has submitted a motion for the opening of a pre-bankruptcy settlement procedure. The company also said in a bourse filing that its affiliates Nasicement, Dilj, Luka Tranzit, Igma and Nexe Beton have likewise filed for pre-bankruptcy settlement before the competent authorities.

By setting the bankruptcy procedure in motion, Nexe Grupa wishes to accelerate the financial and operational restructuring of the company, having in mind the large number of creditors involved, the company said in a separate statement.

Nexe Grupa comprises around 20 companies operating in Croatia, Bosnia, Serbia and Montenegro. It runs the Nasicecement cement plant in Nasice with a cement production capacity of 1Mt/yr.