Displaying items by tag: Results
Bosnia & Herzegovina: Tvornica Cementa Kakanj’s (TCK) sales revenue grew by 13.3% year-on-year to Euro48.5m in 2017 from Euro42.8m in 2016. Its sales volumes of cement rose by 12.3% to 0.49Mt from 0.43Mt. Its earnings before interest and taxation (EBIT) rose by 12.5% to Euro8.89m from Euro8.09m. It attributed the growth to continued growing market at home in Bosnia & Herzegovina.
General director Branimir Muidža said that the subsidiary of Germany’s HeidelbergCement started adding new cement silos to its plant in 2017 with completion scheduled for 2018. It has also started preparing its plants to use refuse-derived fuel (RDF).
Total consumption of cement in Bosnia & Herzegovina was estimated to be 1.2Mt in 2017, a rise of 6% from 2016. The boost was pinned on construction of a new road project.
Update on China in 2017
28 March 2018Many of the Chinese cement producers have released their annual results for 2017 over the last week, giving us plenty to consider. The first takeaway is the stabilisation of cement sales since 2014. As can be seen in Graph 1, National Bureau of Statistics data shows that cement sales grew year-on-year from 2008 to 2014. This trend stopped in 2015 and then government mandated measures to control production overcapacity kicked-in such as a industry consolidation, shutting ‘obsolete’ plants and seasonal closures. Although it’s not shown here, that last measure, also known as peak shifting, cans be seen in quarterly sales data, with an 8% year-on-year fall in cement sales to 578Mt in the fourth quarter of 2017.
Graph 1: Cement sales in China, 2007 – 2017. Source: National Bureau of Statistics.
Looking at the sales revenue from the larger producers in 2017 doesn’t show a great deal except for the massive lead the two largest producers – CNBM and Anhui Conch – hold over their rivals. CNBM reported sales roughly twice as large as Anhui Conch, which in turn reported sales twice as large as China Resources Cement (CRC). With everything set for the merger between CNBM and Sinoma to complete at some point in the second quarter of 2018, that leader’s advantage can only get bigger.
Graph 2: Sales revenue of selected Chinese cement producers. Source: Company reports.
What’s more interesting here is how all of these companies are growing their sales at over 15% in a market where cement sales volumes appear to have fallen by 1.67% to 2.31Bnt in 2017. CNBM explained that its sale growth arose from improving cement prices in the wake of the government’s supply side changes. It added that national cement production fell by 3.1% to 2.34Bnt. CNBM’s annual results also suggested that the cement production capacity utilisation rate was 63% in 2017.
Anhui Conch’s results were notable for its large number of overseas projects as it followed the state’s ‘One Belt, One Road’ overseas industrial expansion strategy. Projects in Indonesia and Cambodia were finished in 2017 with production set for 2018. Further plants are in various states of development in Laos, Russia and Myanmar. The other point of interest was that Anhui Conch is developing a 50,000t CO2 capture and purification pilot project at its Baimashan cement plant. Given the way the Chinese government has been able to direct the local industry, should it decide to promote CO2 capture at cement plants in the way it has pushed for waste heat recovery units or co-processing, then the results could be enormous.
CRC reported its continued focus on alternative fuels. Municipal waste co-processing projects in Tianyang County, Guangxi and Midu County, Yunnan are under construction and are expected to be completed in the first half of 2018. Construction of its hazardous waste co-processing project in Changjiang, Hainan was completed in February 2018.
As ever with the Chinese cement industry, the worry is what happens once the production overcapacity kicks in. The state–published figures and state-owned cement companies suggest that the industry is in the early stages of coping with this. In February 2018 Reuters reported that the Ministry of Industry and Information Technology (MIIT) had banned new cement production capacity in 2018. The detail here is that new capacity is allowed but that it has to follow specific rules designed to decrease capacity overall. This followed an announcement by the China Cement Association that it would eliminate 393Mt of capacity and shut down 540 cement grinding companies by 2020. The aim here is to hold capacity utilisation rates at 80% and 70% for clinker and cement respectively and to consolidate clinker and cement production within the top ten producers by 70% and 60%. If the utilisation rate from CNBM is accurate then the industry has a way to go yet.
Titan’s turnover remains stable in 2017
28 March 2018Greece: Titan Group’s turnover fell slightly to Euro1.51bn in 2017. Bad weather, the devaluation of the Egyptian Pound and weakening of the US Dollar affected its operating results despite a buoyant US market. Its earnings before interest, taxation, depreciation and amortisation (EBTIDA) fell by 1.9% year-on-year to Euro273m in 2017 from Euro279m in 2016. Its net profit fell by 66.5% to Euro42.7m from Euro127m.
The cement producer’s turnover grew by 9.9% to Euro873m in the US despite Hurricane Irma in September 2017 and other poor weather effects. In Greece it reported that build activity weakened further in 2017. It said that although export volumes remained high, its profit margins were hit by the lowering value of the US Dollar and increased fuel prices. Overall, the turnover of its Greece and Western Europe region fell by 4.8% to Euro249m. In Southeastern Europe turnover rose by 10.5% to Euro226m due to increased demand for building materials. Turnover in the Eastern Mediterranean region fell by 36.5% to Euro158m due to negative currency effects in Egypt and a fall in cement demand.
Kenya: Bamburi Cement’s turnover fell by 6% year-on-year to US$357m in 2017 from US$380m in 2016. The subsidiary of LafargeHolcim attributed the decline to poor weather, a prolonged election period and lower construction activity, especially in the individual home builder segment, in Kenya. In Uganda it described the market as ‘broadly flat’ for both domestic and export sectors. The cement producer’s profit fell by 66.5% to US$19.6m from US$58.4m.
Chairman John Simba said, “While the 2017 results reflect a mixed performance in a challenging market environment, we remain positive that the market conditions in both countries will continually improve and rebound in line with the projected growth in both domestic and regional markets. The expected commissioning of the new capacity in the second half of 2018 will see the business enhance its market leadership position and underscores our belief in the growth of East African economies, underpinned by a robust construction industry.”
Huaxin Cement grows revenue by 54% to US$3.33bn in 2017
27 March 2018China: Huaxin Cement’s sales revenue grew by 54% year-on-year to US$3.33bn in 2017 from US$2.15bn in 2016. Its net profit more than tripled to US$331m from US$72m. Cement production rose by 33% to 66.1Mt from 50Mt.
In 2017 Huaxin Cement obtained permission for upgrade projects including 3000t/day at Tibet Shannan, 3000t/day at Shigatse, 4000t/day at Yunnan Luquan and 2.85Mt/yr at Huangshi. Work at Tibet Shannan and Shigatse started in 2017. Construction at Yunnan Luquan and Huangshi is due to start in 2018.
The cement producer reported that an unnamed pilot plant was the first to adopt a co-processing rate of 100% of alternative fuels at the ‘head and end’ of the kiln. It also said that all of its domestic cement plants have been licenced for pollution discharge.
Eurocement Ukraine reduces loss in 2017
27 March 2018Ukraine: Eurocement Ukraine has reduced its loss by 14% year-on-year to Euro4.47m in 2017. It nearly doubled its production to 1.12Mt of cement, according to Nezavisimy Stroitelny. Of this total 1.1Mt was shipped to consumers.
Nigeria: Cement Company of Northern Nigeria’s (CCNN) sales revenue rose by 39% year-on-year to US$54.7m in 2017 from US$39.3m in 2016. Its profit after tax more than doubled to US$9m from US$3.5m, according to This Day newspaper. However, its cost of sales also rose, by 18% to US$33.4m from US$28.3m.
China National Building Material’s cement sales up in 2017 despite production overcapacity
26 March 2018China: China National Building Material’s (CNBM) revenue from its cement operations rose by 22% year-on-year to US$12.4bn in 2017 from US$10.1bn in 2016. Its adjusted earnings before interest, taxation, depreciation and amortisation (EBTIDA) rose by 27% to US$2.94bn from US$2.32bn.
Cement production volumes from the group’s four main divisions – China United, South Cement, North Cement and Southwest Cement – remained stagnant at 258Mt in 2017. However, the group’s cement production capacity for the four divisions was 411Mt/yr giving it a capacity utilisation rate of 63%. Overall the group said it had a cement production capacity of 525Mt/yr.
As well as following government-mandated structural reforms, including environmental changes and production peak shifting, CNBM said that China United started production at a new plant in Mongolia. North Cement completed a merger between its Harbin and Longbei subsidiaries. Southwest Cement completed a merger between Southwest Sichuan Cement and Chongqing Southwest Cement to form Chuanyu Southwest Cement.
Anhui Conch sales up by 35% to US$11.9bn in 2017
23 March 2018China: Anhui Conch’s sales revenue grew by 35% year-on-year to US$11.9bn in 2017 from US$8.85bn in 2016. Its net profit nearly doubled to US$2.51bn from US$1.36bn. The cement producer said that it had, ‘seized the favourable opportunities arising from the state’s further deepening of supply-side structural reform and the promotion of off-peak season production.’
During the year Anhui Conch opened eight cement grinding plants including Quanjiao Conch Cement, Anhui Xuancheng Conch Cement and Nantong Conch Cement. Outside of China the company completed phase two of its Merak grinding plant in Indonesia and started cement production and completed construction of the North Sulawesi Conch plant in Indonesia and the Battambang Conch plant in Cambodia. The units in Indonesia and Cambodia are due to start production in 2018. A new plant, Luang Prabang Conch, is being built in Laos and preliminary work on projects at Volga Conch in Russia, Vientiane in Laos and Mandalay in Myanmar is underway. At the end of 2017 Anhui Conch says it has a clinker and cement production capacity of 246t/yr and 335Mt/yr respectively.
The cement producer also announced that its Baimashan Cement plant was intending to start operating a CO2 collection and purification pilot project in the first half of 2018. The initiative is part of the group’s moves to implement the government’s low-carbon development strategy.
China: Tianrui Cement grew in sales revenue in 2017 due to higher sales prices. However, its sales volumes of cement fell slightly to 29.3Mt in 2017 from 29.5Mt in 2016. This followed government mandated supply side reform and environmental measures such as production suspension. Its sales revenue rose by 40% year-on-year to US$1.33bn from US$950m. Its profit nearly tripled to US$157m from US$39.5m.
The cement producer added that by the end of 2017 all of its clinker production lines were equipped with denitrification systems and bag filters. These upgrades brought the concentration of emitted nitrogen oxides and particulates below the national pollutant emission standards and the concentration of emitted sulphur dioxide also met national standards.
It also completed its acquisitions of majority stakes in Henan Yongan Cement and Tianrui Xindeng Zhengzhou Cement.