Displaying items by tag: HeidelbergCement
Authority sets out terms for Italcementi’s Cementir purchase
30 November 2017Italy: The Italian Competition Authority (ICA) has approved the purchase of Cementir Italia by HeidelbergCement’s subsidiary Italcementi, subject to the sale of certain assets. They are: The Cagnano Aminterno (L'Aquila) cement plant and the terminal at Reggio Calabria, currently owned by Cementir; the Maddaloni (Caserta) plant, currently owned by Cementir; the production facility at Spoleto,, currently owned by Cementir, and the production plant at Salerno, currently owned by Italcementi.
The ICA says that the sales are necessary to prevent excessive concentration in the sector.
CRH, LafargeHolcim and HeidelbergCement among 15 firms interested in bankrupt Binani
22 November 2017India: As many as 15 companies have shown interest in Binani Cement, which is facing bankruptcy proceeding from its lenders, according to senior officials quoted by India’s The Economic Times. Among them are Ireland-based CRH, Swiss-based LafargeHolcim and Germany’s HeidelbergCement, each of which have shown interest in response to initial bids called by the resolution professional. Other bidders include local firms India Cement, Orient Cement, Ramco Cement, Shree Cement, UltraTech Cement and Piramals. Senior officials said that a total of nine domestic players and three financial investors have shown interest in the company.
The bidders will provide a binding bid with a detailed resolution plan, which would involve acquiring equity and recasting the debt, by 22 December 2017. The bidders will have to provide plans to either acquire the company fully or acquire its assets only. Binani has a manufacturing capacity of 11.3Mt/yr, with integrated plants in India and China and grinding units in Dubai, UAE.
Suez Cement to merge with Helwan Cement
15 November 2017Egypt: The board of directors of Suez Cement has agreed to merge with Helwan Cement. It also agreed to sell a 5% stake in Tura Cement. Both Suez Cement and Helwan Cement are owned by HeidelbergCement. Suez Cement operates two plants at Suez and Kattameya. Helwan Cement runs a single plant at Helwan.
HeidelbergCement sells half of its Georgian business
13 November 2017Georgia: HeidelbergCement has sold 50% of the voting rights in its Georgian business to Cement Invest, an investment company jointly managed and owned by the Georgian Co-Investment Fund (GCF) and Hunnewell Partners. HeidelbergCement and Cement Invest will jointly control the resulting joint venture. The transaction will contribute in total about Euro115m to cutting HeidelbergCement’s net debt.
“The joint venture’s competitiveness will be improved with the modernisation of the Kaspi cement plant, where the construction of a modern dry kiln line already started in 2016 and is expected to be finalised by the end of 2018. The disposal is part of our portfolio review and optimisation with the goal to generate additional cash flow in order to support our disciplined growth and increase shareholder returns,” said Bernd Scheifele, chairman of the managing board of HeidelbergCement.
HeidelbergCement started operating in Georgia in 2006. The new joint venture operates three integrated cement plants, a cement grinding facility and a cement terminal on the Black Sea coast. The cement production capacity exceeds 2Mt/yr. A network of 13 ready-mixed concrete plants and two aggregate quarries supports the cement business.
Appeals to Italian competition regulator deferred until June 2018
13 November 2017Italy: Appeals by Italian cement producers to the judiciary of Lazio against fines imposed by the Italian Competition Authority (AGCM) has been deferred to June 2018. Italcementi, Buzzi Unicem, Colacem, Cementir, Sacci, Holcim, Cementirossi, Barbetti, Cementeria di Monselice, Cementizillo, Calme, Moccia, TSC and the Italian Cement Association (AITEC) were penalised more than Euro184m in July 2017 for allegedly coordinating sales prices and agreeing market share from June 2011 to January 2016, according to the ANSA news agency. The majority of the fine was levied on Italcementi and Buzzi Unicem at around Euro84m and Euro60m respectively. Itacementi started appealing against the sanctions in August 2017.
Sinoma wins Luban Prize for Devnya project
09 November 2017Bulgaria/China: Sinoma has won the Luban Prize for its work on the Devnya Cement Plant in Bulgaria. The company won the award for building a 4000t/day clinker production line at the site operated by Italcementi and now owned by HeidelbergCement. The Luban Prize, initiated in 1987, is an award for quality in Chinese construction projects.
Q3 multinational cement producer roundup
08 November 2017The third quarter financial results for HeidelbergCement are out today. They aren’t perfect but the company is hanging in there following its acquisition of Italcementi in late 2016. As one would expect both cement sales volumes and sales revenue are up on a double-digit basis. After all, HeidelbergCement has absorbed a major competitor, including assets, staff, cement plants and all. Its volumes and revenue have improved, more importantly though, on a like-for-like basis, even if it is modest. With the US and Europe driving sales the cement producer has time to make its promised synergies following the Italian acquisition and hopefully wait out recovery in places like Indonesia and Egypt.
Graph 1: Cement sales volumes for selected multinational cement producers during the first nine months of 2017. Source: Company financial reports.
That growth on a like-for-like basis is crucial compared to HeidelbergCement’s big rival, the world’s biggest cement producer, LafargeHolcim. As Graph 1 shows sales volumes data for the major multinational cement producers shows quite a varied picture. LafargeHolcim’s sales volumes have fallen by 12% year-on-year to 156Mt but the company has also been reducing its production capacity. Despite this, a rough calculation of its production utilisation rate suggests that it is selling less cement proportionally, although the company’s like-for-like figures disagree, positing a rise of 1.8%. Cemex’s sales volumes declined slightly to 51.3Mt. The larger regional companies show interesting trends. UltraTech Cement has managed to increase its sales volumes by 5% to 40.4Mt overcoming a poor third quarter in 2016. What to watch here will be whether this will be enough to overcome the effects of demonetisation that rocked India’s economy in late 2016.
Graph 2: Sales revenue for selected multinational cement producers during the first nine months of 2017. Source: Company financial reports.
The stronger regional positions of those last two companies really hits home when sales revenue is examined. As can be seen in Graph 2 both UltraTech Cement and Dangote Cement are growing their sales revenue, the latter despite dropping sales volumes. UltraTech Cement is suffering from falling profits due to rising fuel costs and it may yet suffer from ‘corporate indigestion’ as it digests its acquisition of 21.2Mt/yr cement production capacity from Jaiprakash Associates that took place in June 2017. Dangote Cement seems to have increased its earnings and profits despite problems at home in Nigeria by improving its fuel mix. Yet, flirtations with South Africa’s PPC aside, its expansion plans remain in a holding position. Dangote Cement presents another fascinating situation. Its overall sales volumes have fallen but this reflects a failing market at home in Nigeria and doesn’t show the company’s booming sales in the rest of Sub-Saharan Africa.
Results from CRH and the Brazilian companies Votorantim and InterCement will further flesh out the situation when they are released. Yet, the difference between worldwide producers and regional producers seems to be clear. The likes of LafargeHolcim and Cemex with a global presence are generally battling stagnation in the cement markets overall with a couple of key markets holding them back. Meanwhile, larger regional producers in the right locations are growing. However, the absence of the Brazilian producers is critical here as their experience of the floundering market in Brazil is very different to that of, say, UltraTech Cement’s in India. Looking ahead, the next quarter will be particularly interesting to see how demonetisation skewed UltraTech Cement’s performance, to start to see the first results from HeidelbergCement a year after its purchase of Italcementi and how well LafargeHolcim’s new chief is doing.
HeidelbergCement sales start to build so far in 2017
08 November 2017Germany: HeidelbergCement has started to build its sales revenue following its acquisition of Italcementi with growth in Europe and North America. Its sales rose by 19% year-on-year to Euro13bn in the first nine months of 2017 from Euro10.9bn in the same period in 2016. On a like-for-like basis this rose by 1.1%. Its cement and clinker sales volumes rose by 29.2% to 94.4Mt from 73Mt or by 0.3% on a like-for-like basis.
“As expected, the positive trend reversal in May 2017 led to a significantly improved development of results in the third quarter”, said chairman of the managing board, Bernd Scheifele. “North America, Australia, Morocco, India, as well as Northern and Eastern Europe have developed very strongly. The countries of Southern Europe are showing clear signs of recovery, and the emerging countries have passed their lowest point. We have succeeded in reducing the rise in energy costs through the flexible use of various fuels.” He added that the synergies from the acquisition of Italcementi have already ‘significantly’ exceeded the target for 2017.
By region cement sales volumes rose in all regions on both a consolidated and pro forma basis except for the group’s Northern and Eastern Europe - Central Asia and its Asia-Pacific regions. In the US strong markets were noted in California and Washington alongside price growth. In Indonesia the cement producer said that despite the market showing signs of recovery it was still facing price pressure. In Egypt continued reduced market demand was reported.
Invercem to open modular cement plant in April 2018
07 November 2017Peru: Invercem plans to build a cement grinding plant in Ica for US$20m. The modular plant will have a production capacity of 0.25Mt/yr, according to the Gestión newspaper. Construction is scheduled to start from December 2017 with completion planned for April 2018.
Previously, Invercem has imported cement from HeidelbergCement via the port of Salaverry. It then bagged and sold it locally under the Qhuna brand. As well as building its own plant the cement importer is also considering expansion plans in Ayacucho, Cusco and Iquitos.
Workers launch global union network at HeidelbergCement
03 November 2017Germany: Union delegates representing workers at HeidelbergCement have created a trade union network. Forty delegates from Europe, Middle East and North Africa, North America, Asia-Pacific and South Asia met in early November 2017 in Bremen. The meeting was organized by IndustriALL Global Union with support of the Friedrich Ebert Foundation, also involving IndustriALL‘s sister organisation Building and Wood Workers’ International.
“With the creation of the HeidelbergCement union network, we open the door to social dialogue if management is willing, and we hope union activists will contribute seriously to the promotion of workers’ rights and interests in the company. To this end, the steering committee will be in close interaction with the national unions. Finally, we strongly believe that HeidelbergCement will only win through workers’ active participation and engagement,” said Matthias Hartwich, director for materials industry at IndustriALL.
The meeting discussed recent developments in the cement sector and sustainability issues. The experience of global and national unions interacting with management at another big cement giant company, LafargeHolcim, was also raised. At the end of the meeting, delegates unanimously adopted a Bremen declaration and elected a steering committee for the network, which will coordinate the work in between its global meetings. No representative of the group’s global management attended the event despite being sent invitations.