Displaying items by tag: Mexico
Mexico: Holcim will start a programme to use biomass as fuel in August 2014 at its Orizaba cement plant. Its subsidiary Ecoltec has installed a system to utilise biomass, using residual heat from the cement furnaces. The company will use coffee bagasse and biomass from the paper and beer industries, according to spokesman Gustavo Gastelum. Apart from limiting fossil fuel consumption, the project will also reduce methane gas emissions from organic waste. Since 1990 Holcim Mexico has cut its net carbon dioxide emissions by 19%.
Additional management adjustments at Cemex
23 May 2014Mexico: Further management changes have been implemented at Cemex, including the inclusion of six executive vice presidents, instead of five. The six vice presidents will report directly to the director general, Fernando Gonzalez, with the position of executive vice president of finance to be filled by Jose Antonio Gonzalez.
Juan Pablo San Agustín will continue as executive vice president of strategic planning and business development, while Maher Al-Haffar has been appointed as executive vice president of investor relations, corporate communications and public affairs. Luis Hernandez will continue as executive vice president of organisation and human resources, as well as security and administrative services, while he will also be responsible for processes, IT, innovation, global service organisation (GSO), the securities funding corporation (VMO) and the Neoris project. Ramiro Villarreal will remain head of legal affairs, taking up the position of executive vice president of legal, while he will continue as secretary of the board of directors. Mauricio Doehner has been appointed as executive vice president of corporate affairs and business risk management.
No changes have been made at the regional director level. Cemex executives have also expressed a desire to recover investment grade at the firm, lost during the crisis in 2009.
Mexico: Cementos Moctezuma has announced US$200m of investments to increase its cement production capacity by 1.3Mt/yr to 2.6Mt/yr at its plant in Apazapan, Veracruz. The company, which is owned by Buzzi Unicem, Cementos Molins and Carso, runs three plants in Mexico with a total production capacity of 6.4Mt/yr. Moctezuma's income grew by11% to US$164m in the January - March 2014 period.
Mexico: Cemex has announced that it has promoted its chief financial officer (CFO), Fernando Gonzalez, to chief executive. Gonzalez replaces Lorenzo Zambrano, who died suddenly on Monday 12 May 2014. It also named Rogelio Zambrano, a cousin of the late executive, as its new chairman. Lorenzo Zambrano had been chief executive since 1986 and chairman since 1995.
"We will stay focused on creating value for all of our stakeholders," said Rogelio Zambrano in a statement. "I am very optimistic about Cemex's future." He has been a member of the Cemex board since 1987 and president of the company's finance committee since 2009.
Fernando Gonzalez joined the company in 1989 and held senior positions in a number of regions before being named executive vice president for finance and administration several years ago. "We are encouraged by the positive outlook and the improving business environment in the markets where we operate," he said in the release.
The board's decision to replace Lorenzo Zambrano from within the company is likely to reassure investors of continuity at Cemex, which is seeing a recovery in earnings after the recent economic crisis led the highly leveraged firm to refinance debt, sell assets and lay off around 10% of its workforce. The speed at which the board has responded is also likely to instill confidence.
After taking over the company, Zambrano embarked on a rapid and ambitious international expansion that transformed Cemex from a regional producer into a global supplier of cement and building materials, borrowing heavily to acquire companies and aggressively paying down debt.
Mexico: The board of Cemex may soon decide on a new CEO to replace the late Lorenzo Zambrano, who died of heart failure in Madrid on 12 May 2014. A funeral Mass was held on 14 May 2014.
Directors are likely to hold a meeting in the next few days, according to CFO Fernando Gonzalez. "The board meeting should occur this week," said Gonzalez. "What I can't tell you is the result." A swift decision by directors on a new CEO may reassure investors about the course of Cemex after Zambrano's three-decade tenure. He led the company to the top of the regional industry with US$29bn of acquisitions and became one of Mexico's best-known CEOs, while leaving no publicly anointed successor. Gonzalez, Cemex's CFO, is the odds-on favourite to succeed Zambrano according to analysts.
Gonzalez said that he didn't know whether the board would consider hiring a leader from outside of the company and that major shifts in the business are unlikely. "Cemex's strategy should be maintained," he said. "The strategy is to participate in the global market of the building materials industry." Gonzalez, who isn't a director, said that only the board knows the details of Cemex's succession planning. Even if the board meets this week, there's no guarantee it will make a final decision on new leadership.
Cemex CEO Lorenzo Zambrano dies
13 May 2014Mexico: Lorenzo Zambrano, CEO of Cemex died on 12 May 2014 in Madrid aged 70. There were no immediate details about the cause of death in a statement released by Cemex and there had been no reports of illness. The company added that it will continue to operate normally.
Founded by Zambrano's grandfather more than a century ago, the company started producing cement in the northern city of Monterrey, which later became one of Mexico's industrial hubs. Zambrano was born on 27 March 1944. He joined the company after graduate school in 1968, when he earned his master degree in business administration at Stanford University. By 1985 the board of directors give him full power as CEO. Then, through a series of acquisitions, Zamrano extended Cemex's reach to five continents with operations in 50 countries.
However a US$16bn acquisition of Australian building materials company Rinker in 2007 subjected Cemex to the subprime housing crisis. At the time, Zambrano put a brave face on it. "We've shown that a company that is born in a developing country can compete in the whole world and we want to keep doing it," he said. Cemex spent the following years coping with large debt obligations, struggling to make deals with lenders and trimming costs by outsourcing and restructuring jobs.
Article updated: 14 May 2014
Cemex loss deepens despite increased earnings
30 April 2014Mexico: Cemex has announced that its net sales reached US$3.6bn in the first quarter of 2014, an increase of 8% compared to the same period of 2013. Operating earnings before interest, tax, depreciation and amortisation (EBITDA) increased by 3% year-on-year. The group made a net loss of US$293m for the quarter, a deterioration compared to a loss of US$281m in the first quarter of 2013.
Net sales in Cemex's operations in Mexico decreased by 6% in the first quarter of 2014 to US$737m, compared to US$780m in the first quarter of 2013. Operating EBITDA for the country decreased by 5% to US$250m versus the year-earlier period.
Cemex's operations in the United States reported net sales of US$792m in the first quarter of 2014, up by 8% from the same period in 2013. Operating EBITDA in the country increased by 48% to US$28m.
In Northern Europe, net sales for the first quarter of 2014 increased by 21% to US$912m, compared with US$756m in the first quarter of 2013. Operating EBITDA increased to US$13m in the quarter, versus a loss of US$17m in the same period of 2013.
First-quarter net sales in the group's Mediterranean region were US$412m, 19% higher than the US$347m taken during the first quarter of 2013. Operating EBITDA increased by 11% to US$81m.
Cemex's operations in South, Central America and the Caribbean reported net sales of US$538m during the first quarter of 2014, representing an increase of 8% over the same period of 2013. Operating EBITDA remained flat at US$187m.
Operations in Asia reported a 3% increase in net sales for the first quarter of 2014, to US$146m, versus the first quarter of 2013. Here, operating EBITDA for the quarter was US$26m, up by 8% year-on-year.
Fernando A González, Executive Vice President of Finance and Administration at Cemex, said, "We are pleased with the growth in our operating EBITDA during the quarter, on a like-to-like basis, adjusting for the seasonal maintenance and inventory-drawdown effects, which we expect will revert throughout the rest of the year. We also saw positive dynamics in consolidated volumes and prices for our main products."
Cemex to invest US$600m in wind energy in Nuevo Leon
24 March 2014Mexico: Cemex plans to develop a wind power project in Nuevo Leon state, Mexico with an investment of US$600m, according to chairman and CEO Lorenzo Zambrano. The project will consist of two wind farms that cost US$300m each, which could be installed within two years.
Cemex will use at least 10% of the power output and has identified potential customers that could purchase the remainder. The complex, dubbed Las Ventikas, is expected to generate energy savings of US$15m/yr for the company. Cemex could also install wind farms for its operations abroad, for example in the Philippines, where it is seeking a government permit for a project of this type.
Cemex reports sales up 2% globally in 2013
06 February 2014Mexico: Cemex has anounced that its consolidated net sales increased by 4% during the fourth quarter of 2013 to approximately US$3.9bn and increased by 2% for the whole of 2013 to US$15.2bn versus the comparable periods of 2012. Operating earnings before interest, tax, depreciation and amortisation (EBITDA) increased by 4% during the fourth quarter of 2013 to US$642m and increased by 1% for the whole of 2013 to US$2.6bn versus 2012.
Cemex said that the increase in consolidated net sales was due to higher volumes in the US and its operations in the Mediterranean, Northern Europe, Asia and South, Central America and the Caribbean, as well as higher product prices in local currency terms in most regions. Operating earnings before other expenses in the fourth quarter increased by 30% to US$359m and increased by 17% to US$1.5bn for the full-year 2013.
Cemex reported a narrower controlling interest net loss of US$255m during the fourth quarter of 2013, down from a loss of US$494m in the same period of 2012. For the full-year 2013, controlling interest net loss improved to US$843m from a loss of US$913m in 2012.
Operating EBITDA during the fourth quarter increased by 4% to US$642m. For the full year 2013, operating EBITDA increased by 1% to US$2.6bn versus 2012. On a like-to-like basis and also adjusting for the pension plan effect, full-year 2013 operating EBITDA increased by 4%.
Fernando A González, Executive Vice President of Finance and Administration, said, "During 2013 we continued to deliver. This is our third consecutive year of EBITDA growth, driven by improvement in pricing and volume in most of our regions, the favorable operating leverage effect in the US and our continued initiatives to improve our operating efficiency."
The fourth quarter of 2013 by region
Net sales in Cemex's operations in Mexico decreased by 6% in the fourth quarter of 2013 to US$785m, compared with US$832m in the fourth quarter of 2012. Operating EBITDA decreased by 17% to US$247m versus the same period of 2012.
Cemex's operations in the US reported net sales of US$819m in the fourth quarter of 2013, up by 8% from the same period in 2012. Operating EBITDA increased to US$77m in the quarter, versus a US$13m profit in the same quarter of 2012.
In northern Europe, net sales for the fourth quarter of 2013 increased by 5% to US$1.1bn, compared with US$1.0bn in the fourth quarter of 2012. Operating EBITDA was US$79m for the fourth quarter, 1% lower than the same period of 2012.
Fourth-quarter net sales in the Mediterranean region were US$394m, 11% higher when compared to sales of US$354m during the fourth quarter of 2012. Operating EBITDA decreased by 5% to US$78m for the quarter versus the comparable period in 2012.
Cemex's operations in South, Central America and the Caribbean reported net sales of US$577m during the fourth quarter of 2013, representing an increase of 11% over the same period of 2012. Operating EBITDA increased by 15% to US$183m in the fourth quarter of 2013, from US$159m in the fourth quarter of 2012.
Operations in Asia reported a 4% decrease in net sales for the fourth quarter of 2013, to US$133m, versus the fourth quarter of 2012. Operating EBITDA for the quarter was US$32m, up by 12% from the same period of 2012.
MINTed cement industries
08 January 2014There was a great quote on BBC News from Nigerian cement mogul Aliko Dangote to start 2014 with: "Can you imagine, can you believe, that [Nigeria] has been growing at 7%/yr with no power, with zero power? It's a joke."
In the article Dangote is describing economic growth in Nigeria and the BBC points out that 170 million people in Nigeria use the same amount of power as 1.5 million people do in the UK. The author then goes on to predict that Nigeria could grow at a rate of 10 – 12%, by just solving power infrastructure in the country.
For the start of 2014 the British state broadcaster has been running a radio series on the so-called MINT economies. The term refers to the growing economies of Mexico, Indonesia, Nigeria and Turkey and is being used as a new buzzword in the same fashion as BRIC (Brazil, Russia, India and China) to describe broadly similar growing economies outside the traditional western bloc dominated by the G7.
Comparing the cement industries in the MINT countries raises some discrepancies between the desires of Western economists and the local cement industries. Mexico has a population of 118m, a Gross Domestic Product (GDP) of US$1.85tr and a cement production capacity of 50Mt/yr. Indonesia has a population of 238m, a GDP of US$1.29tr and a cement production capacity of 47Mt/yr. Nigeria has a population of 175m, a GDP of US$479bn and a cement production capacity of 28Mt/yr. Turkey has a population of 74m, a GDP of US$1.17tr and a cement production capacity of 82Mt/yr.
Mexico and Turkey have the lower populations in the MINT group, the highest (and most similar) Gross Domestic Product (GDP) per capita at US$15,000 and are the more developed cement industries in the group with the higher cement production capacities per capita. All of the MINT countries have infrastructural issues that will require large amounts of cement in the coming years.
Highlighting Dangote's concerns we cover a cement industry news story this week from Nepal, where Dangote is considering potential locations for a cement plant. Part of the publicly reported meeting between Dangote and the Nepalese government concerned power requirements for the project. Dangote intends to generate 30MW itself and has asked Nepal to provide 30MW. From the CEO downwards the cement producer clearly understands the problems of underdeveloped infrastructure. This is not surprising given his comments above!
That MINT economies are growing powers will not surprise the cement industry. In this week's Global Cement Weekly, in addition to the Dangote story, we feature two news stories focusing on direct industry capital investment in Indonesia. Looking more widely nearly half the stories are from BRIC or MINT countries.
With this in mind Global Cement has developed its own buzzword for the cement industry in 2014: the VISA group. This group includes Vietnam, Italy, Spain and Australia, countries that have all had problems with their cement industries in 2013 such as a production overcapacity or financial losses. If readers have any nicknames of their own for groups of cement producing nations let us know at This email address is being protected from spambots. You need JavaScript enabled to view it..