Displaying items by tag: Lafarge

Philippines: Aboitiz Equity Ventures Inc, a Philippine investment holding company, has signed a US$400m loan to help fund the acquisition of the Philippine assets and business of cement maker Lafarge SA. The loan is being provided by The Bank of Tokyo-Mitsubishi UFJ Ltd.

Aboitiz Equity signed a deal with CRH in May 2015 to allow it to join the Irish building materials company in buying Lafarge's cement plants in the Philippines. CRH earlier agreed to buy the assets as part of Lafarge and Holcim assets that were due to be sold off prior to the formation of LafargeHolcim. Aboitiz Equity had said the investment is part of efforts to expand in infrastructure development.

Germany: Lafarge's assets in Germany, which were recently sold to Ireland's CRH as part of the LafargeHolcim merger, have been rebranded by CRH as 'Opterra.' The assets include two integrated cement plants and one grinding plant.

UK: Investment boutique Perella Weinberg Partners has hired LafargeHolcim co-chairman Wolfgang Reitzle as an advisory partner.

Reitzle, also a former chief executive of the German gas maker Linde and chairman of the supervisory board of German car supplier Continental, will provide counsel in a senior role to the investment firm and its clients, especially in Europe, according to Perella Weinberg. He will continue in his role at LafargeHolcim.

Reitzle has had previous dealings with Perella Weinberg Partners; Holcim appointed Perella Weinberg banker Dietrich Becker to renegotiate the terms of its merger with Lafarge. "Reitzle has an exceptional track record of successfully managing growth across a variety of industries," said Joseph Perella, co-founder and chairman of Perella Weinberg Partners.

Europe: LafargeHolcim has decided to initiate a squeeze-out process for all issued and outstanding shares of Lafarge. After surpassing the necessary 95% threshold in the share capital and voting rights and following a decision by the board of directors, LafargeHolcim plans to request that the AMF implement a squeeze-out procedure pursuant to their general regulations for Lafarge shares not tendered to the Public Exchange Offer. LafargeHolcim will publish further details on the squeeze-out upon filing with the AMF.

US: Summit Materials has reported increased net revenue, operating income and gross profit in the second quarter of 2015, which ended on 30 June 2015.

"During the second quarter of 2015, we produced significant growth in net revenues and margins across all of our lines of business. This strong improvement reflects the steady demand improvement in all of our regions, despite some weather-related challenges, mainly in Texas and Kansas, and our disciplined focus on price optimisation across our vertically integrated lines of businesses. We achieved this while also expanding our adjusted EBITDA margin by 300 basis points and generating incremental margins in excess of 50%. The success of our acquisition strategy was also evident in our results, with more than half of our profit growth contributed by our accretive acquisitions," said Tom Hill, president and CEO of Summit. "We believe our sustained progress is a direct result of the steps we have taken to expand our business into attractive markets and establish leadership positions throughout our diversified footprint. Our completion of the Davenport assets acquisition was an exciting milestone for our company and significantly advanced our position as a leading cement producer in the Midwest. We are now better positioned to continue enhancing our materials earnings exposure and overall profitability as we integrate these assets onto our platform. As we look to the back half of 2015, we plan to capitalise on the improving demand environment to improve our profitability while also remaining opportunistic with our capital to further expand our businesses in select target markets."

In the second quarter 2015, net revenue increased by 12.5% to US$329m. The increase in net revenue was primarily attributable to an increase in volumes across all lines of business, led by the West and Central regions. Net revenue grew organically by 3.2% to US$9.3m. Adjusted earnings before interest, taxes, depreciation and amortisation (EBITDA) increased by 28.4% to US$78.1m, with growth in all regions. As a percentage of net revenue, adjusted EBITDA improved to 23.8%, compared to 20.8% in the prior year quarter.

Adjusted EBITDA in the west region grew by 28.4% to US$8.7m, primarily driven by a higher mix of net revenue from aggregates, organic volume and price growth and the impact of acquisitions, mainly in the Houston and Midland / Odessa, Texas and British Columbia, Canada markets. In the central region, adjusted EBITDA increased by 23.2% to US$6.7m, largely attributable to price growth across all lines of business, stronger volume in aggregates and ready-mixed concrete and the favourable impact of acquisition activity. Adjusted EBITDA in the east region improved by 20.8% to US$1.6m, primarily as a result of higher volume in aggregates leading to a larger mix of net revenue derived from materials.

Gross profit increased by 25.1% to US$116m. As a percentage of net revenue, gross profit improved to 35.2%, compared to 31.6% in the prior year quarter, primarily attributable to a higher mix of net revenue from materials and products as a result of organic improvement and acquisition activity. Net revenue from materials increased by 29.6% to US$88.1m. Cement volumes and prices increased by 0.7% and 9.1%, respectively, both driven by additional market demand. Gross profit from materials grew by 34.7% to US$52.7m.

On 17 July 2015, Summit Materials completed the acquisition of the Davenports Assets, including a 1.2Mt/yr cement plant, a quarry and seven cement distribution terminals, from Lafarge for US$450m in cash and a cement distribution terminal in Bettendorf, Iowa. The Davenport Assets are being integrated with and will operate as Continental Cement Company, an existing wholly-owned subsidiary of Summit.

Ireland: On 2 February 2015, CRH announced that it had reached an agreement to acquire certain assets from Lafarge and Holcim for Euro6.5bn. The deal has now been completed, with the exception of the Philippines, which is expected to close in the third quarter of 2015.

"Today we extend a warm welcome to 15,000 new colleagues joining CRH. With their expertise and talent on board, combined with the strength of our existing employee base, CRH is a step closer to achieving our aim of becoming the world's leading building materials company. The businesses we are acquiring, which represent an excellent geographic fit with CRH's existing operations, are all strong performers in their respective areas. The integration of these high quality assets, which we have acquired at an attractive valuation and at the right point of the cycle, will strengthen our presence in a number of key markets as well as providing new platforms for strategic growth. The additional scale will help us to improve efficiency, speed up innovation and provide an even better service to our customers," said Albert Manifold, CRH chief executive.

The transaction more than doubles CRH's cement production volumes and will further expand its aggregates and ready-mixed concrete portfolios. The acquired assets consist of more than 685 locations in 11 countries and include:

- The largest cement producer in central Canada; an excellent fit with CRH's existing Americas Materials business;
- Major cement and aggregates operations in western Europe's three largest markets: The UK, France and Germany;
- Leading cement and aggregates companies in the growth regions of central and eastern Europe, creating a strong regional cluster in which CRH becomes the number one heavy-side building materials company;
- Entry positions of scale in two emerging economic regions; Brazil and the Philippines.

With the closure, Tarmac and Blue Circle come together to form Tarmac, under the new ownership of CRH, according to Agg-Net. The company's new branding combines the heritage and innovation associated with the Tarmac name and the unique identity of the Blue Circle logo. The newly combined business is now the market leader in aggregates, asphalt, contracting services, lime and powders and is a leading player nationwide in cement, concrete and other building products.

"This is an exciting evolution for our business. With our new owner CRH in place to support the ongoing development and delivery of our strategic vision, we're in an exceptionally strong position to deliver our growth ambitions and continue creating value for our customers, our shareholders and our employees," said Tarmac's CEO, Cyrille Ragoucy, said. Tarmac has confirmed that there will be no change to its relationships with customers, suppliers and other stakeholders.

Europe: The Autorité des marchés financiers (AMF) has published the final results of the re-opened public exchange offer initiated by LafargeHolcim for the shares of Lafarge.

Some 25,901,191 additional Lafarge shares have been tendered. Following the settlement-delivery of the re-opened offer, which is expected to occur on 4 August 2015, LafargeHolcim will hold 278,131,864 Lafarge shares representing 96.41% of the share capital and at least 95.25% of the voting rights of Lafarge. As at least 95% of the share capital and voting rights in Lafarge have been tendered, LafargeHolcim could request the AMF to implement a squeeze-out procedure pursuant to the general regulations of the AMF for all issued and outstanding Lafarge shares not tendered to the public exchange offer. As of yet, no decision by the LafargeHolcim board of directors of LafargeHolcim has been taken in this regard.

Nigeria: Lafarge's Ashaka Cement has reported a 5% year-on-year fall in half year pre-tax profit to US$21m in the first half of 2015, according to Reuters. Its revenue also dropped to US$54m from US$61.8m in the same period of 2014. The company's gross income fell to US$21.8m from US$25.9m in 2014.

Romania: Lafarge's like-for-like cement sales in Romania rose by 25.2% year-on-year in terms of value in the first half of 2015, according to SeeNews. In terms of volume, cement sales in Romania climbed by 30.4% year-on-year in the first six months of 2015. "In Romania, cement volumes rose by 37% in the second quarter of 2015, bolstered by solid trends in the residential and the non-residential segments," said Lafarge in a statement.

France: Lafarge has reported mixed results for the second quarter and first half of 2015, with lower cement volumes but higher sales for both periods.

In the second quarter of 2015, cement volumes decreased by 3% due to lower export sales. On its domestic markets, Lafarge's volumes increased by 2%. Cement prices fell by 0.5% year-on-year but rose by 0.5% quarter-on-quarter. Volumes were supported by continuing positive trends in many markets such as Romania, the Philippines, Egypt and Canada, while adverse weather limited growth in the US. Some markets faced more challenging economic and/or political environments. This was notably the case in France, where the construction sector remains subdued. In Brazil, Lafarge faces a very challenging overall environment. In Iraq and Syria difficulties in transporting cement across the country have prevailed since June 2014.

Lafarge's sales grew by 5% year-on-year to Euro3.54bn in the second quarter of 2015. Exchange rates continued to be favourable with a positive impact on sales of Euro249m or 8%, while the impact of Lafarge's divestments, notably in Ecuador, Russia and Pakistan, reduced its sales by 3% or Euro75m. Its earnings before income, taxes, depreciation and amortisation (EBITDA) improved by 1% to Euro820m, supported by favourable exchange rates with a positive impact of Euro52m or 6%. Its operating income fell by 3% year-on-year to Euro608m.

Results in the second quarter of 2015 were impacted by one-off items in connection with the creation of LafargeHolcim that was finalised on 10 July 2015. These one-off items include Euro450m of impairment on some of the assets to be divested to CRH in the third quarter of 2015. Pre-tax merger costs of Euro94m were booked in the second quarter of 2015 and one-off restructuring costs, mainly reflecting reorganisation measures in France, amounted to Euro51m, compared to Euro32m in the same period of 2014. Excluding one-off items, Lafarge's net income was Euro210m in the second quarter of 2015, down by Euro27m from the same period of 2014.

Lafarge received Euro232m in cash for divestments in the second quarter of 2015, mainly reflecting the proceeds for its operations in Pakistan. Investments totalled Euro262m. Capital expenditures remained limited at Euro82m compared to Euro67m in the second quarter of 2014. Development investments amounted to Euro180m, mainly including projects in North America (Exshaw in Canada and Ravena in the US) and in Algeria, as well as a few debottlenecking projects, notably in the Philippines.

For the first half of 2015, Lafarge has reported a 4% year-on-year reduction in cement sales to 54.7Mt, while its sales grew by 5% to Euro6.32bn. Its EBITDA grew by 6% to Euro1.22bn and its operating income grew by 8% to Euro813m.

For the entirety of 2015, Lafarge expects cement market growth of 1 - 4%. Cost inflation should continue albeit at a slower pace than in 2014, given the evolution of fuel oil prices. This should result in higher prices overall. Lafarge should also benefit from more favourable exchange rates.