Global Cement News

Germany: HeidelbergCement has continued to benefit from its acquisition of Italy’s Italcementi. Its sales revenue rose by 2.1% year-on-year on a like-for-like basis to Euro17.3bn in 2017 from Euro17.1m in 2016. Its cement sales volumes increased by 1.1% to 126Mt from 124Mt.

“The challenges were numerous: energy cost inflation, increased competition in emerging markets, especially in Indonesia, uncertainties following the Brexit decision and bad weather, especially in the USA,” said Bernd Scheifele, chairman of the managing board of HeidelbergCement. “Nevertheless, we were able to increase our result from current operations as guided. The consistent focus on efficiency and margin improvement and the successful integration of Italcementi that led to higher than expected synergies contributed to this success. Overall, 2017 was a record year for sales volumes, revenue and result from current operations.”

The group reported increasing cement deliveries in all areas except Africa-Eastern Mediterranean in its preliminary results. In this region cement sales volumes fell by 0.6% to 19Mt from 19.1Mt due to a poor market in Egypt. Otherwise it described its market development in the region as ‘varied.’

France: Vicat’s earnings have suffered from by falling cement sales volumes in Egypt and a ‘sharp’ increase in production costs caused by the devaluation of the Egyptian Pound in late 2016. Its earnings before interest, taxation, depreciation and amortisation (EBTIDA) fell by 5.9% at constant scope and exchange rates to Euro444m in 2017 from Euro458 in 2016. Despite this, its consolidated sales rose by 6.4% to Euro2.56bn from Euro2.45bn. The cement producer’s cement sales volumes rose by 4.9% to 22.9Mt from 21.9Mt.

“Vicat posted a healthy performance in 2017 amid a very mixed environment,” said group chairman and chief executive officer (CEO) Guy Sidos. He added that the group had faced ‘difficult’ weather conditions, currency trends and geopolitical tensions in some of its markets. “In spite of these headwinds, our businesses in France, Asia and the US made healthy progress and offset the contractions in the Africa and Middle East region.”

India: Ambuja Cements has benefited in 2017 as the impact of demonetisation and general sales tax eased. The subsidiary of LafargeHolcim reported that its sales rose by 12% year-on-year to US$1.58bn in 2017 from US$1.41bn in 2016. Its operating earnings before interest, taxation, depreciation and amortisation (EBTIDA) rose by 14.9% to US$300m from US$261m. Its cement sales volumes rose by 8.7% to 23Mt from 21Mt.

“During the year, we focused on providing specific solutions to address customer needs, value offerings, particularly for the retail segment products, and made strong investments in building brand equity. Our strategy to focus on premium products, core markets and managing costs has delivered higher sales and EBITDA growth,” said Ajya Kapur, managing director and chief executive officer (CEO) of Ambuja Cements.

India: Dalmia Bharat Cement and UltraTech Cement have each submitted bids of around US$930m for Binani Cement. The amount also includes upfront cash payments, as well as an offer of close to 20% stake in Binani to lenders, according to sources quoted by the Hindustan Times. A winning bid is expected to be chosen by the end of February 2018.

Both bidders have been asked for additional details related to their bid to allow the creditors to make their final decision. UltraTech Cement, for example, has been asked to provide information on a Competition Commission of India (CCI) penalty imposed upon it in 2016.

Ireland/UK: Breedon Aggregates is reportedly in talks to buy a part or all of Ireland’s Lagan Group, according to the Sunday Times newspaper. Breedon Aggregates and Lagan’s subsidiary Whitemountain operate an asphalt joint venture at present. However, Lagan Group did not respond to a request for comment on the talks.

Breedon Aggregates purchased Hope Construction Materials in 2016, which included the Hope cement plant. The acquisition boosted Breedon’s financial results in 2017 giving it a revenue of Euro523m and it described the year as the, “…most eventful year in the group’s history.”

Lagan Cement operates a 0.7Mt/yr plant in Kinnegad in Ireland. In late 2012 it proposed a joint venture with Quinn Building Products. However, the deal fell through in early 2013 following the receipt of a package containing a bullet which was sent in the post to the Lagan's chief executive, Kevin Lagan. The bullet, which was sent to Lagan at his Belfast office, was accompanied by a message stating, "Quinn ... is this what you want".