Displaying items by tag: Results
Italcementi loss grows to Euro69.3m in 2015
19 February 2016Italy: Italcementi’s loss has grown by 41.7% year-on-year to Euro69.3m in 2015 from Euro48.9m in 2014. The multinational cement producer blamed this on falling revenue per unit amidst general poor markets, particularly in Egypt. Despite this its revenue grew by 3.5% to Euro4.3bn in 2015 from Euro4.16bn in 2014, boosted by a stronger fourth quarter and currency effects.
Overall cement clinker sales volumes remained unchanged in 2015 at 43.4Mt. Growth in North Africa, Middle East (Egypt and Kuwait) and the more contained growth in North America was counterbalanced by downturns in Europe, Asia and Trading.
Italcementi expects growth in North America, moderate sales growth Egypt and stability in emerging markets in 2016. Demand for building materials is expected to be stable overall in Italy, France and Belgium, with a general recovery elsewhere in Eastern European and Mediterranean markets. It plans to raise prices in all areas except for India and Thailand.
The group also announced that it has completed the procedures for the sale of non-core assets to Italmobiliare, under the agreements signed by Italmobiliare with HeidelbergCement. Italcementi will sell to its parent Italmobiliare the stakes it holds in renewable energy company Italgen and e-procurement specialist BravoSolution, in addition to a building in the centre of Rome. The asset sales will be wrapped up on finalisation of the agreement between Italmobiliare and HeidelbergCement.
Bestway Cement profit rises by 47% to US$54.4m in first half
19 February 2016Pakistan: Bestway Cement has reported that its profit after tax has risen by 47% year-on-year to US$54.4m from July to December 2015 from US$372m in the same period in 2014. Its revenue rose by 45.5% to US$201m from US$138m. It attributed the growth to the acquisition of Pakcem, an increase in domestic demand and stable prices during the period.
Domestic sales volumes for the company increased by 47% to 3.1Mt from 2.1Mt. It reported that overall dispatches by the Pakistan cement industry increased by 6.3% to 18.2Mt from 17.1Mt. Overall exports dropped by 26% to 3Mt from 4.1Mt. Bestway reported that it maintained its market share in the north of Pakistan and retained its position as the largest exporter of cement to Afghanistan and India, despite fierce competition.
Work on Bestway Cement’s 12MW waste heat recovery plant at Pakcem Kallar Kahar progressed during the period. The upgrade project is expected to cost US$15m.
China Tianrui Group expects net profit to drop by 30% in 2015
18 February 2016China: China Tianrui Group Cement has said that it expects that its 2015 net profit will drop by more than 30% year-on-year in 2015. It has blamed the downturn on China's economic slowdown that has reduced demand for cement and lowered the selling price. The cement producer didn’t release a figure for its expected net profit in 2015 but it reported a net profit of US$86.6m in 2014. It intends to release its full financial results for 2015 at the end of March 2016.
Cementos Pacasmayo’s profit rises by 12.1% to US$60.4m in 2015
17 February 2016Peru: Cementos Pacasmayo’s net income rose by 12.1% year-on-year to US$60.4m in 2015 from US$53.8m in 2014. Its revenue fell slightly to US$351m from US$354m. Its cement production volumes fell slightly by 0.7% to 2.3Mt from 2.35Mt.
The cement producer attributed its profit growth to cost savings despite a ‘challenging’ operating environment. It managed to hold its cement production volumes at a stable level due to the ramping up of its Piura cement plant in the fourth quarter of 2015 despite falling volumes at its Pacasmayo and Rioja cement plants.
HeidelbergCement profit rises by 16% in 2015
16 February 2016Germany: HeidelbergCement has reported that its operating income or profit has risen by 16% year-on-year to Euro1.85bn in 2015 from Euro1.6bn in 2014 in its preliminary results for 2015. Its revenue grew by 6.7% to Euro13.5bn from Euro12.6bn in the same period. It attributed the growth to efficiency drives, price increases in key markets, lower energy costs and currency effects due to a weakening Euro.
“2015 was by far the best year for HeidelbergCement since the financial crisis,” said Bernd Scheifele, Chairman of the Managing Board. “Despite the slowdown of the global economy in the course of the year, we were able to significantly increase our operating income as anticipated. Our strict focus on improving efficiency and margins in recent years, our advantageous geographical positioning, and continuous investments in growth have made a significant contribution.”
The group reported that sales volumes of cement remained stable in 2015. A rise in cement deliveries in North America and Africa almost compensated for the decrease in Europe and Asia. Sales also benefited in the fourth quarter of 2015 from mild weather extending the construction period in parts of Europe. Overall the group reported that sales volumes of cement, clinker and ground-granulated blast-furnace slag (GGBS) fell slightly to 81.8Mt in 2015 from 81.1Mt in 2014. A similar trend was reported in the fourth quarter of 2015.
By region, overall sales revenue rose in Western and Northern Europe in 2015 driven by demand for building materials in the UK, price increases, currency effects and reduced energy costs. Despite all of this cement sales volumes fell slightly. In Eastern Europe and Central Asia both sales revenue and volumes fell in 2015 mainly due to decreased demand in Ukraine and Russia. In North America both sales revenue and volumes grew in 2015 with a particular positive trend in the west of the US. Revenue grew by 22.9% to Euro3.75bn. Sales volumes in cement grew by 1.9% to 12.3Mt. Asia-Pacific reported both sales revenue and volumes falling in 2015 led by a downturn in Indonesia and Malaysia. Sales revenue and volumes grew in Africa-Mediterranean Basin in 2015 in most countries with the exception of Ghana, where sales volumes fell due to negative effects due to the falling oil price.
HeidelbergCement noted in its preliminary results that the ‘evaluation of potential synergies was provisionally concluded at the start of 2016’ for its takeover of Italcementi. As such its cost-saving target for the takeover has been raised from Euro300m to Euro400m. Approvals have been granted by the competition authorities in India, Canada, Morocco, and Kazakhstan. Discussions with the competition authorities in the US and in Europe are currently ongoing. HeidelbergCement expects the purchase of the 45% stake to be concluded in the first half of 2016.
Raysut Cement profit drops by a fifth in fourth quarter
12 February 2016Oman: Raysut Cement reported a 21.5% drop in fourth-quarter net profit, according to Reuters’ calculations. The largest cement firm by market value in the sultanate made US$13.4m in the three months ending 31 December 2015, compared with US$17.0m in 2014. Raysut’s net profit for 2015 was US$54.6m, down by 23.6% on the US$71.2m it earned in the previous year.
ACC reports 69% drop in profit
12 February 2016India: ACC Ltd has reported a 69% drop in its consolidated net profit for the quarter ending 31 December 2015, on account of lower income from avenues other than its core business.
The consolidated net profit was US$14.9m compared to U$47.8m in 2014. Net sales rose by 3% to US$417.3m from US$404m in 2014. Its earnings before interest, tax, depreciation and amortisation (EBITDA) rose by 9% to US$41.0m from US$37.7m in 2014.
Buzzi Unicem sales revenue rises by 6.2% to Euro2.66bn in 2015
11 February 2016Italy: Buzzi Unicem has reported that its revenue rose by 6.2% year-on-year to Euro2.66bn in 2015 from Euro2.51bn in 2014. Clinker and cement sales volumes increased by 1.7% to 25.6Mt from 25.1Mt. It attributed the growth to market recovery in the US and Eastern Europe and an additional contribution from the Korkino cement plant in Russia.
Following a sharp drop in business during the first six months of 2015, the group reported that the recovery in international trade recorded in the second half of the year was weaker and less than expected, especially in mature countries. Subsequently, its growth in 2015 was half of its previous estimate. Construction activity in the last quarter of 2015 was bolstered by a dry and mild climate in Italy, Central and Eastern Europe allowing construction activity to remain at levels above the seasonal average.
The group’s net debt fell to Euro1.03bn in 2015 from Euro1.06bn in 2014. It expects from preliminary data that its earnings before interest, taxation, depreciation and amortisation (EBITDA) will be Euro470m in 2015.
Cementir profit rises by 3.1% to Euro103m in 2015
11 February 2016Italy: Cementir Holding has reported that its profit rose by 3.1% year-on-year to Euro103m in 2015 from Euro100m in 2014. Its revenue rose by 2.2% to Euro969m from Euro948m. It attributed the growth to good performance of operations in the Scandinavian countries, Malaysia, Italy and Egypt.
“The Group ended 2015 with earnings before interest, taxation, depreciation and amortisation (EBITDA) in excess of the target of Euro190m. Improved performance in Scandinavian countries and Italy, plus the stable contribution of the Far East, offset the lower earnings in Turkey and Egypt caused by socio-political tensions across the Mediterranean and the Middle East, as well as the negative impact of the depreciation of some foreign currencies,” said Francesco Caltagirone Jr, Chairman and Chief Executive Officer of Cementir. He added that the group reduced its net debt to Euro222m in 2015.
The Italy-based building materials company produced 9.37Mt of cement in 2015, a decrease of 2% year-on-year from 9.56Mt in 2014.
Cemex: wrong place, wrong time?
10 February 2016Cemex trumpeted last week that it had returned to positive net income for the first time in six years in its fourth quarter results for 2015. In effect the multinational building materials company was saying it is putting its house in order following taking on too much debt in the late 2000s. Similar reassuring noises have repeatedly been made as it has cut its debts down since that time.
The figure Cemex was shouting about this time was its controlling interest net income or the net income attributable to the controlling shareholder. It has risen to a gain of US$75m after being negative, or in loss, since 2010. In that year the sting from the financial crash in 2008 caused havoc and net sales for the company hit a low of US$14bn, having been at over US$20bn in the boom times of 2007 and 2008.
Meanwhile, the company has been steadily whittling away at its total debt reducing it down to just US$15.3bn in 2015. This is a massive figure given that its total equity was US$9.5bn in 2015.
By comparison, Lafarge was reporting a net debt of Euro9.3bn in 2014 compared to a total equity of Euro17.3bn. Its debt-to-equity ratio was far smaller than Cemex’s despite being perceived as the weaker partner financially going into the merger with Holcim in 2015. Unsurprisingly, it was news in August 2015 when Cemex refinanced a bank loan agreement for a US$15bn debt that was previously renegotiated in 2009. Everyone is watching Cemex’s debts keenly.
Against this financial backdrop Cemex’s cement business has been steadily producing fairly static levels of cement since 2009. It 2015 it has reported that it produced 66Mt. However, net sales fell in 2015 by 8% year-on-year to US$14bn, a disappointing result following sales growth since 2012. Fernando A Gonzalez, Cemex’s Chief Executive Officer, blamed it on a ‘challenging’ macroeconomic environment.
Notably overall net sales have been down in Mexico, Northern Europe and Central and South America in 2015. Although Cemex hasn’t released cement sales volumes, volumes fell by 3% in Northern Europe, 2% in its Mediterranean region and 4% in Central and South America in 2015. Thankfully, growth continued to pick up the US, bolstered by housing and infrastructure spending. The Philippines has remained a powerhouse in cement consumption in Asia.
Reviewing Cemex’s expansion projects in 2015 suggest muted capital expenditure with a focus on upgrades and side projects rather than clinker production growth. Such announcements included projects in Nicaragua, the Dominican Republic, Colombia and Mexico. The exception was in the Philippines where a full-on US$300m project including a new 1.5Mt/yr plant was announced in May 2015. Given the surging cement volume sales in the country this is likely a safe investment.
As discussed previously in this column and elsewhere Cemex has suffered from high debts at exactly the time its major international rivals have started to merge. At the same time its Chinese rivals in terms of production capacity have undergone similar capacity consolidation as part of state mandated capacity reduction initiatives. This has left Cemex between the mega-cement producers like LafargeHoclim and HeidelbergCement and the up-and-comers such as Eurocement or Votorantim.
Now, its reliance on markets in the Americas it hitting a roadblock from reducing growth south of the US as global commodity prices tumble and economies suffer. It couldn’t have happened at a worse time for the company. Bar the odd bright spot such as the US and the Philippines it seems that all Cemex can do is wait it out.