Displaying items by tag: US

US: Tim Breen, the president and chief executive officer (CEO) of Motion Industries, has died suddenly. The 58-year old began his career with Berry Bearing Company in 1982 and worked as a Sales Representative, Branch Manager, Regional Manager, and Corporate Accounts Manager, according to the Birmingham Business Journal.

His responsibilities continued to grow after Berry Bearing and Motion Industries joined forces in 1993. He worked as a Division Officer and Group Officer and took responsibility of all the US locations in 2011 as Executive Vice President and chief operating officer (COO). Breen was promoted to Motion Industries President and COO in 2013, before his promotion in November 2014 to President and CEO.

"Motion Industries has lost a great leader and the world has lost an amazing human being," said Motion Industries. "Those of us who have been fortunate enough to know and work with Tim have lost a dear friend and an inspiration. Tim leaves behind a great company, a great culture and a great team that he affectionately referred to as 'The Motion Family.' His spirit will forever live on at Motion."

Motion Industries is an industrial parts distributor of bearings, mechanical power transmission, electrical and industrial automation, hydraulic and industrial hose, hydraulic and pneumatic components, industrial products, safety products, and material handling.

UK: Refractory producer RHI Magnesita says that its cement and lime segment was ‘flat’ in the first half of 2018. It blamed this on on-going low capacity utilisation in China and Brazil and ‘some’ market share losses due to its prices. The adjusted sales revenue of its Industrial Division, including cement and lime, rose by 14.3% year-on-year to Euro413m in the first half of 2018 from Euro362m in the same period of 2017. Overall, the company reported a 24.6% increase in revenue to Euro1.51bn from Euro1.21bn.

In a separate release RHI Magnesita subsidiary Magnesita said that the company’s revenue rose by 81.6% to US$133m. This was attributed to sales to the cement business in North America and higher deliveries in Europe in 2018. However, Magnesita’s services business suffered from a poor cement market in Brazil.

US: Eagle Materials Inc. has announced that Michael Haack has been named as its new President in addition to his role as Chief Operating Officer (COO). The announcement was made by Dave Powers, Eagle’s Chief Executive Officer (CEO). "Michael has been serving as our COO since 2014 and has distinguished himself across all of our lines of business,” said Powers. “This expansion of Michael's role reflects the company's significant growth in recent years and the opportunity to build our leadership capacity, as we extend Eagle's track-record as the benchmark operating performer in the industry."

Michael Haack added, "I am excited to take on this expanded responsibility, as we continue to pursue our well-established strategy of value creation and capitalise on the many opportunities we see ahead."

Prior to joining Eagle, Haack spent 17 years at Halliburton Energy Services, holding successively senior operating positions, culminating with the management of Global Operations for Sperry Drilling, a multi-billion dollar company in the drilling and evaluation division of Halliburton. Haack holds a Master of Science degree from Texas A&M University and a Bachelor of Science degree from Purdue University, both in Industrial Engineering, as well as an MBA from Rice University.

Nigeria: A team of US investors announced that it will seek to revitalise Nigercem, located in Nkalagu, Ebonyi State. Addressing a cross section of stakeholders on 9 August 2018, the Chief Executive of Ibeto Nigeria Limited, Chief Cletus Ibeto said, “I am standing before you with a team of American financiers, who are here on an assessment visit to the plant.”

In her remarks, the leader of the American foreign investors, Amanda Wester, said, “We extol Ibeto Nigeria Limited the core investor in Nigercem in its commitment to establish a new 6000t/day process cement plant and 45MW capacity power plant in this first phase of the project at Nkalagu.

US: Monarch Cement’s net sales fell by 3% year-on-year to US$74.3m in the first half of 2018 from US$76.8m in the same period in 2017. Its net income decreased by 42% to US$4.8m from US$8.23m. The building materials company operates a cement plant at Humboldt, Kansas and a terminal at Des Moines, Iowa.

Nigeria: A group of investors from the US have visited Ibeto Cement’s Nigercem plant in Nkalagu. The visit was part of an assessment to prepare Ibeto Cement for a listing on a stock exchange in the US, according to the This Day newspaper. Cletus Madubugwu Ibeto, the chief executive officer (CEO) of Ibeto Group said that Chinese contractors were due to work on upgrading the plant to a production capacity of 6000t/day with a 45MW waste heat recovery unit. In May 2018 Beta Cement signed an investment deal with US-based private equity firm Milost Global for US$850m.

China/US: China’s Ministry of Commerce has proposed placing retaliatory tariffs on products from the US, including cement. The list covers 5207 items and proposes adding import taxes of up to 25% on them. It includes clinker, white cement, limestone, quicklime, slaked lime, gypsum, refractory products and cement packaging machinery. The ministry said that the new tariffs will take effect at a date to be announced later on.

US: The Federal Trade Commission (FTC) has approved a final order settling changes for Ireland’s CRH acquisition of Ash Grove Cement following a period for public comment. The FTC issued its consent for the transaction in June 2018 on the condition that CRH sell the Three Forks cement plant in Montana to Mexico’s Grupo Cementos de Chihuahua (GCC).

Also under the settlement, because the CRH cement plant in Montana currently sells a significant amount of cement into Canada through two CRH terminals in Alberta, GCC will have the option to use those terminals for three years. CRH also has agreed to purchase, at GCC’s option, cement produced at the plant for distribution in Canada for up to three years. The FTC also forced CRH to sell other assets in Montana, Nebraska and Kansas.

US: Summit Materials’ mid-year results have been negatively affected by poor cement sales and lower aggregate sales from its Houston operations. Revenue rose by 15% year-on-year to US$717m in the first half of 2018 from US$623m in the same period in 2017. However, its sales volumes of cement fell by 10% to 0.97Mt from 1.08Mt. The company’s net loss rose to US$19m from US$3m.

“Organic sales volumes in our cement segment were impacted by a combination of high precipitation levels during April and May, together with competitive pressures in the markets we serve,” said chief executive officer (CEO) Tom Hill.

The building materials producer operates an integrated cement plant under the Continental Cement subsidiary at Hannibal in Missouri.

Cemex joined the divestment party this week with the news that it plans to sell up to US$2bn worth of assets by the end of 2020. Put that together with LafargeHolcim’s own divestment plan of selected assets worth up to US$2bn as part of its Strategy 2022 and there is potentially a lot of cement production infrastructure going on sale over the next few years.

Both companies say that they will start announcing the latest round of divestments in the second half of 2018. Prices vary considerably around the world - and remember this is not only cement - but at, say, US$250m per integrated plant that could amount to 16 units. That’s a big enough manufacturing base to build your very own cement production empire! So, which markets might the two companies be considering leaving?

Cemex’s weaker areas in its half-year report were its South, Central America and the Caribbean region and, to a lesser extent, its European region. The former reported falling sales, cement volumes and earnings. The latter reported falling earnings on a like-for-like basis with issues noted across cement, ready-mix concrete and aggregate business lines in the UK. Back in Central and South America, problems were noted in Colombia due to a 10% fall in cement sales in the first half. An important point to make here is that despatch figures from the National Administrative Department of Statistics (DANE) out this week suggest that Colombia’s overall cement market has picked up since April 2018 (see Graph 1), in contrast to Cemex’s experience. Panama, meanwhile, saw cement volumes wither by 22% due to the 30-day strike by construction workers. Other operations to consider for the chop might include Cemex Croatia, which the company attempted to sell to HeidelbergCement and Schwenk Zement in 2017, before the European Commission put an end to that idea.

Graph 1: Annual change of cement despatches in Columbia in 2017 and 2018. Source: DANE.

When asked directly during its second quarter results call which assets it was intending to sell, chief executive officer (CEO) Fernando Gonzalez didn’t answer on commercial grounds. What he did say though was that the company had faced ‘headwinds’ in the Philippines, Egypt and Colombia, particularly in relation to fuel prices. He also said that Cemex had finished its market analysis, that it knew exactly which assets it would like to sell already and that it was in ‘execution’ mode. In Gonzalez’s own words, “we do have a number of assets to be divested, either because they are low growth, or because they are not necessarily integrated to other business lines.”

As covered a couple of week ago, the obvious location for LafargeHolcim to exit is Indonesia. CEO Jan Jenisch continued to refuse to comment on rumours that the company was leaving the country during its second quarter results call. Yet, local production overcapacity, falling earnings and profits and an underperforming but still sparky market make it the ideal candidate. What Jenisch did reveal was that the country had ‘positive momentum.’ Perhaps more importantly he added, “We are not selling because we want to sell. We are selling for high valuations only.”

Other potential locations for LafargeHolcim to leave might include Brazil and parts of the Middle East and Africa. Brazil’s cement market recovery has been a few years coming and was delayed again by a truck drivers’ strike in May 2018. The Middle East Africa area was the worst performing region in LafargeHolcim’s mid-year results with problems noted in South Africa.

With all of this in mind we have a rough idea of what Cemex and LafargeHolcim might be considering selling. The obvious candidates for both companies seem to be solid markets that promise growth after a period of underperformance. Just like Colombia and Indonesia in fact. Looking at the track record for both of them in recent years Cemex has seemed to be more ready to sell individual plants such as the Odessa and Fairborn plants in the US to different buyers. LafargeHolcim for its part has generally gone for larger more complete sales of regional or country-based chunks of its business such as in Chile or Sri Lanka.

Finally, don’t forget that Cemex’s Fernando Gonzalez said in March 2018 that the company was considering acquisitions again after a decade of austerity. He mentioned an interest in India and in Brazil. If he meant that last one then maybe he should give LafargeHolcim’s Jan Jenisch a call.