
Displaying items by tag: Lafarge WAPCO
Geoffrey Ndugwa appointed as head of Lafarge Cement Zimbabwe
05 January 2022Zimbabwe: Lafarge Cement Zimbabwe appointed Geoffrey Ndugwa as chief executive officer (CEO) in mid-December 2021. He succeeds Precious Murena, who stepped down in September 2021.
Ndugwa was previously the CEO for Lafarge Malawi from late 2019. He brings experience in the cement industry spanning over 17 years working in various capacities across Africa. Some of his notable appointments include being the Commercial Director for Bamburi Group in Kenya, the General Manager Innovation and Marketing for Lafarge WAPCO Nigeria, the General Manager for Bamburi Special Products in Kenya, the Head of Business Support for Barclays Bank of Uganda and the Sales Manager for Hima Cement in Uganda.
Ndugwa holds a master’s degree in Business Administration from Heriot-Watt University in the UK, a post graduate diploma in marketing from the Chartered Institute of Marketing in the UK and a Civil Engineering degree from the University of East London.
Lafarge Africa – was it worth it?
19 September 2018Nigerian financial analysts Cordros Securities concluded this week that the merger of some of Lafarge’s Sub-Saharan African businesses had reduced earnings at Lafarge Africa. The report is interesting because it explicitly points out a situation where the consolidation of some of Lafarge’s various companies have failed in the wake of the formation of LafargeHolcim.
Cordros Securities’ criticism is that Nigeria’s Lafarge WAPCO performed better in 2013 alone before it became part of Lafarge Africa, with a higher standalone earnings before interest, taxation, depreciation and amortisation (EBITDA) margin. Lafarge Africa formed in 2014, a year before the LafargeHolcim merger was completed, through the consolidation of Lafarge South Africa, United Cement Company of Nigeria, Ashakacem and Atlas Cement into Lafarge WAPCO. Since the formation of Lafarge Africa, Cordros maintains that its earnings per share have consistently fallen, its share price has dropped, its debt has risen, its margins have decreased and its sales volumes of cement have also withered.
Cordros mainly focuses on the Nigerian parts of Lafarge Africa’s business, given its interest in that market and the fact that about three quarters of the company is based in the country. It blames the current situation on growing operating costs since the merger, skyrocketing financing costs for debts and efficiency issues. In Nigeria, Lafarge Africa has had to cope with disruptions to gas supplies. Nigeria’s Dangote Cement had similar problems domestically in 2017 with falling cement sales volumes in a market reeling from an economic recession but Cordros reckoned that Dangote is picking up market share in the South West due to an ‘aggressive retail penetration’ strategy. Finally, Lafarge Africa faced a US$9m impairment in 2017 due to its abandoned pre-heater upgrade project at AshakaCem. The project has been suspended since 2009 due to security concerns in the North-East region. The plant faced an attack by the Boko Haram militant group in 2014 and the group has seemed reluctant to invest further in the site subsequently.
Cordros’ final word on the matter is that with the Nigerian cement market performing slower than it has previously, the local market has become a battleground between the established players of Dangote Cement, BUA Group and Lafarge Africa. What little the report does have on South Africa covers problems with old and inefficient hardware, labour disputes, low prices due to weak demand, high competition and a negative product mix.
Lafarge Africa itself presents a more mixed picture, with market growth picking up in Nigeria following end of the recession but continued market problems in South Africa. Overall, its reported sales grew by 4.8% to US$448m in the first half of 2018 but its EBITDA fell by 25% to US$76.4m. Overall cement sales volumes were reported as up by 5.4% to 2.6Mt in the first half but volumes were still falling in South Africa in the second quarter.
Part of the backdrop to all of this is the intention of Lafarge Africa to cut its debt. In May 2018 its chairman Mobolaji Balogun said that the company wanted to cut its debts by 2020 before continuing with its expansion programme. Part of this process will include a new rights issue later in 2018 to allow shareholders to buy stock at a discount.
It must have made sense, on paper at least, to merge the Lafarge subsidiaries in the two largest economies in Sub-Saharan Africa. Once the merger had settled in, with synergies generating extra revenue, the group could have considered adding extra territories such as Kenya. However, it’s not turned out like that. Two recessions in Nigeria and South Africa respectively, old equipment, debt and serious competition from locally owned producers have piled on the pressure instead. From a stockholder perspective, Cordros is not impressed by the performance of Lafarge Africa. The wider question is: what else did Lafarge and Holcim get wrong when they joined to form LafargeHolcim?
Nigerian analysts blame earnings loss at Lafarge Africa on merger
17 September 2018Nigeria: Financial analysts Cordros Securities have blamed falling earnings at Lafarge Africa on the merger of its Nigerian businesses with Lafarge South Africa. In a research report the analysts found that the merger increased operating costs and reduced shareholder value, according to the Vanguard newspaper. Lafarge WAPCO’s earnings per share, earnings before interest, taxation, depreciation and amortisation (EBITDA) and profit before tax have all fallen since 2013. It also found that operating costs had increased ‘significantly’ following the merger, debt had risen and that earnings had also been hit by efficiency issues.
Lafarge announced plants to merge its businesses in Nigeria and South Africa in 2014. The move saw the consolidation of Lafarge South Africa, United Cement Company of Nigeria, Ashakacem and Atlas Cement to Lafarge WAPCO. It was subsequently renamed Lafarge Africa.
Adepeju Adebajo resigns from Lafarge Africa
05 April 2017Nigeria: Adepeju Adebajo has resigned as an executive director of Lafarge Africa. Adebajo was the Managing Director, Wapco Operations and then Managing Director, Geo-Cycle and Project Management Office at Lafarge Africa. Her resignation from Lafarge follows her appointment as the Honourable Commissioner for Agriculture in Ogun State.
Nigeria/South Africa: French cement maker Lafarge intends to combine its businesses in Nigeria and South Africa. The new company Lafarge Africa, which will be 73% owned by Lafarge Group, will remain listed on the Nigerian Stock Exchange. The new company will have a cement production capacity of about 12Mt/yr in South Africa and Nigeria as well as operations in aggregates, ready-mix and fly ash. The new company will be worth more than US$3bn.
"I am proud to be part of the creation of this leading African building materials platform. It will provide access to growth in two of the largest economies on the continent. It will mean that our shareholders are invested in a larger and more geographically diverse business and it will contribute significantly to the economic growth of both our nations, " said Chairman of Lafarge WAPCO, Chief Olusegun Osunkeye.
Under the proposed terms, Lafarge Group will transfer its direct and indirect shareholdings in Lafarge South Africa Holdings (Pty) Limited (100% - representing 72.4% of underlying companies in South Africa), United Cement Company of Nigeria Limited (35%), Ashakacem plc (58.61%) and Atlas Cement Company Limited (100%) to Lafarge WAPCO. The transaction is subject to Lafarge WAPCO shareholder approvals and obtaining required regulatory and other customary authorisations. The group anticipates completion during the second half of 2014.
Nigeria: Lafarge Cement WAPCO, Ashaka Cement and Unicem have started court action against the Standards Organisation of Nigeria (SON) regarding its plan to limit the application of 32.5 grade cement. The action follows a publication by SON restricting the application of 32.5R grade cement to plastering use only.
"We have instituted a suit against the SON over its recent pronouncement and plan to implement a new mandatory industrial standard order for cement manufacturing, distribution and usage in the country," said the three cement producers at a briefing in Lagos. The producers added that 32.5 grade cement is a widely used multi-purpose product and has 'never' been associated with building collapses.
Guillaume Roux appointed Country CEO of Lafarge in Nigeria
16 October 2013Nigeria: Lafarge has announced the appointment of Guillaume Roux as the Country Chief Executive Officer for Nigeria and Benin Republic effective from September 2013. He succeeds Jean-Christophe Barbant.
Roux, a joint French and US national, is a graduate of the Institut d'Etudes Politiques in Paris. He joined the Lafarge Group in 1980 as an Internal Auditor.
After holding several key positions in the Finance Department in France and the United States, he was appointed as Vice President, Strategy and Marketing for North America in 1996 and later as Chief Executive of Lafarge operations in Turkey in 1999.
In 2002 he was given responsibility for Lafarge's cement operations in South-East Asia, a position he held until he joined the Executive Committee of Lafarge Group as Executive Vice President and Co President of the Cement Division, with the responsibility for the cement business in Eastern Europe, the Middle East and Africa in 2006.
Roux is a member of the Executive Committee for Lafarge Group and combines this role with his current responsibility for Lafarge's operations in Nigeria and Benin Republic. This is the first time a member of the Group Executive Committee will also be a Country CEO.
Nigerian producers hit back at Ibeto
03 January 2013Nigeria: Cement manufacturers have hit back at Ibeto Cement Company over its resolve to continue to import cement into Nigeria, despite the capacity of local manufacturers to meet demand.
A statement by Dangote Cement's head of corporate communications Anthony Chiejina said that Dangote and Lafarge WAPCO Cement were worried about the glut created by, according to him, importers.
Cement manufacturers, under the aegis of Cement Manufacturers Association of Nigeria (CMAN), have also said that unless the federal government fulfils its promise of halting importation the cement sub-sector of the economy might go into serious decline, with inventories building up at plants and reduced production. Cement producers are strongly lobbying for the development of concrete roads in Nigeria.
CMAN chairman, Joseph Makoju, said that the domestic cement production level of 18.5Mt/yr was being threatened. "The target of 18.5Mt/yr represents just 65% of the present total installed capacity of the industry," he explained. "Between 2002 and May 2012 a total of US$6bn in new investment was made by local manufacturers, while the ongoing expansion and new plants are estimated to have cost another US$3.5bn. Due to continuous rapid growth the nation no longer requires cement imports as local demand is being effectively met and even surpassed."
The reported oversupply in the the Nigerian market has already forced Dangote to halt production in its 4Mt/yr Gboko plant in Benue State and has prompted Lafarge WAPCO to reduce production. According to the plant manager at Lafarge's Ewekoro cement plant, Lanre Opakunle, 50% of Lafarge's Shagamu plant had been shut down. The Ewekoro plant has reportedly been running on a skeletal staff to prevent it from being closed completely. The manufacturers stress that, if the cement glut continues, it may force 'hundreds of thousands' of Nigerians out of jobs.