Global Cement News

Indonesia: Yostinus Hulu, the chairman of the Association of North Nias Community (Himni) has urged the city administration of Gunungsitoli, Nias in North Sumatra to set up a government-backed company to cope with cement shortages. He said that cement supplies had been disrupted by infrastructure projects in the region, according to the Antara news agency. The city has faced frequent cement shortages.

Germany: Beumer has opened a new sales office in the Ruhr area. The new ‘West’ office will enable Beumer Customer Support to handle worldwide retrofitting and modernisation projects including, for example, currently operating conveying systems like bucket elevators and clinker conveyors, and those from other suppliers. The engineering company says that its goal is to cooperate closely with its headquarters in Beckum and provide everything from one source, from receiving a query, to technical dimensioning and on-site installation.

China: Austria’s Semperit has closed its Sempertrans Best (Shandong) Belting plant in Shandong. The decision was made as part of review of the group’s production footprint. The plant had a higher margin than other sites. The closure is also expected to reduce the complexity of operations at the group level. 120 employees will be affected and the shutdown is expected to burden the group’s earnings before interest and taxation (EBIT) by Euro10m in 2018.

The groups subsidiary in Shandong was founded by Semperit as a joint venture with the state-owned energy company Wang Chao Coal & Electricity Group in 2010. The Chinese partner currently holds a 16.1% stake. The production site manufactures textile and steel cord belts and has served the export markets and the Chinese market so far.

South Africa: PPC’s profit rose due to strong performance in Zimbabwe and Rwanda. Its gross profit rose by 3% year-on-year to US$174m in the financial year that ended on 31 March 2018 from US$169m in the same period in 2017. Its revenue grew by 7% to US$762m from US$715m. However, its earnings before interest, taxation, depreciation and amortisation (EBITDA) fell by 9% to US$140m from US$153m.

"Our performance has been resilient against the backdrop of challenging economic and political environments in markets in which we operate. While our rest of Africa operations, particularly Zimbabwe and Rwanda, achieved good results, our materials division faced reduced demand and increased competition. Our results have also been impacted by a number of significant abnormal items: corporate action, impairment of Democratic Republic of the Congo (DRC) operations and restructuring costs,” said chief executive officer (CEO) Johan Claassen.

By region, the group’s sales in South Africa and Botswana fell slightly due to a fall in cement sales volumes of 2 – 3%. Imports rose by 32% although PPC said it was from a low base. Elsewhere in Africa, PPC’s sales volumes rose by over 50% supported by ‘robust’ volume growth in Rwanda and Zimbabwe. The group’s PPC Barnet cement plant in Democratic Republic of Congo was commissioned in November 2017.

PPC’s lime division increased its revenue by 2% to US$59m, with volumes and selling prices similar to 2017. Volumes were constrained by key steel-customer shutdowns and non-extension of a significant contract. Lime's EBITDA contracted by
18% after higher variable costs for maintenance and raw material inputs.

Tanzania: Kenya’s ARM Cement has improved a deal to sell its non-cement businesses by adding additional assets in Tanzania worth US$8.5m for free. Previously, the company said it had reached an agreement to sell its fertiliser and mineral production businesses in Kenya to Switzerland’s Omya & Pinner Heights, a company owned by its ARM’s chief executive officer (CEO) Pradeed Paunrana, for US$15.8m, according to the Citizen newspaper. ARM has added in its annual report
that potential buyers could acquire its non-cement operations in Tanzania for free.

The cement producer reported a loss of US$55m in 2017 due to poor demand in Kenya and Tanzania. It said it was undergoing a ‘significant’ review of its current operations, asset base and financing structure to address its problems.