Global Cement News
Search Cement News
Oman Cement awards US$11m contract to FLSmidth 11 May 2015
Oman: Oman Cement Co has awarded a US$11.3m contract for the upgrade of pollution control equipment at a production line to FLSmidth. "To reduce emission levels, the company has awarded the upgrade work for the pollution control equipment for line 2 to FLSmidth. The company has issued a letter of intent in this regard which has been accepted by FLSmidth," said Oman Cement. In a recent report, Oman Cement said that its project for installing an additional 150t/hr cement mill with supporting infrastructure of cement silos and bulk despatches is in progress and is expected to be completed in the fourth quarter of 2015.
Croatia: Holcim's Croatian unit has recorded an operating profit in the first quarter of the year, for the first time since 2009. Holcim Croatia said that its revenues fell by Euro463,000 in the first three months of 2015 compared to the same period of 2014. However, the revenues were 10% above its plan.
In July 2014, Holcim Croatia's board chairman Alan Sisinacki said that the ongoing 2015 Plus Turnaround Programme should get the company back to profitability in 2015. However, the company said on 8 May 2015 that it is still not certain that it will turn to profit in 2015. Holcim Croatia cut its loss to Euro1.78m in 2014 from Euro6.34m in 2013.
Greece: Titan Group has reported that in the first quarter of 2015 its consolidated turnover grew by 12.7% year-on-year to Euro284m. Its earnings before interest, tax, depreciation and amortisation (EBITDA) fell by 23.7% year-on-year to Euro23.2m. Its net profit after minority interests and the provision for taxes grew to Euro6.6m compared to a Euro11m loss in the prior year period.
The continuing recovery in the US and the improvement in the Greek market due to the continuation of public works and the higher profit margins on exports had positive effects on operating results. However, profitability declined significantly in Southeastern Europe and Turkey due to the heavy winter, as well as in Egypt, where prolonged gas shortages necessitated the production of cement through imported clinker in order to meet domestic demand. The group is currently undertaking significant investments in Egypt which will enable the utilization of solid and alternative fuels and allow for the gradual recovery of the plants' operating capability.
Group net debt at the end of the first quarter stood at Euro660m, increased by Euro119m compared to 2014 year-end. Group debt levels reflect the increased investments undertaken primarily in the US and in Egypt, increased working capital requirements in growth markets, the seasonality in demand, as well as the negative effect on US Dollar and Egyptian Pound-denominated debt owing to foreign exchange movements.
Total turnover for Greece and Western Europe in the first quarter of the year declined by 2% to Euro65.3m. EBITDA grew to Euro9.4m compared to Euro3.9m in the same period in 2014.
In the US, despite the severe weather witnessed in the first two months of the year, the construction industry continued to recover, resulting in a tangible improvement in Titan America's results. The strengthening of the US Dollar also contributed to results. Total turnover in the US for the first quarter of 2015 grew by 37.5% to Euro130m while EBITDA reached Euro5.8m compared to Euro0.9m in 2014.
In Southeastern Europe, the harsh winter considerably affected building activity, resulting in a significant decline of results compared to the favourable winter experienced in 2014. Turnover declined by 31.2% to Euro28.2m while EBITDA reached Euro4.2m compared to Euro9.7m in 2014.
In Egypt, demand remained stable. The utilisation rate of production facilities improved compared to the second half of 2014 low levels due to the completion of the investment in solid fuels grinding at one of Titan's production lines at Beni Suef. However, the continuing disruptions in natural gas supply at other production lines led to the need for lower margin imports in order to meet demand. Overall, turnover in Egypt increased by 21.9% to Euro60.2m. Compared to the first quarter of 2014, when sales were met by domestic production, EBITDA declined from Euro15.9m to Euro3.9m.
In Turkey, due to the heavy winter, demand for building materials declined. Adoçim Çimento (in which Titan Group holds a 50% stake) posted lower volume sales and results versus the first quarter of 2014.
The market trends recorded in the beginning of the year are consistent with the group's positive outlook for 2015, despite significant uncertainties and challenges. This reserved optimism can be attributed to the expectation of improved operating results from the group's two most important markets: the US and Egypt. The recovery of the US market continues unabated within the context of a broader US economic recovery. In order to meet higher demand and improve competitiveness, the group is increasing capital spending. In Egypt, demand for building materials is expected to remain at high levels, supported by both private and public construction. The group expects to recover production and sales volumes in 2015, following the investments undertaken in order to ensure the gradual self-sufficiency of the plants, in terms of their fuel needs.
In Greece, private construction continues to decline with no recovery expected in 2015 due to the dire economic conditions prevailing in the country. Cement consumption in 2015 is expected to remain at the same levels as in 2014, mainly supported by roadwork activity. Construction activity in Southeastern Europe appears stable, although cement demand is considerably below the group's capacity. No significant improvement is expected in the short-term since the region continues to be affected by the weakness of Eurozone neighbour countries.
India: Birla Corporation has reported a 9% growth in its standalone net profit at US$4.45m for the quarter that ended on 31 March 2015. Its total standalone income rose marginally to US$125m in the quarter of the last fiscal from US$124m in the prior year period. During the fourth quarter of its 2015 financial year, cement production declined by 2.7% year-on-year to 1.87Mt. Cement dispatches also fell by 1.31% to 1.88Mt during the period.
During the 2014 - 2015 financial year, cement production was up by 3.77% year-on-year to 7.62Mt, while cement dispatches rose by 4.42% to 7.67Mt. Birla Corp's consolidated net profit during the year rose by 35% year-on-year to US$27.4m from US$20.3m in the same period of the previous year. Revenue grew by 6% year-on-year to US$502m.
"Barring the first quarter of the current financial year, cement demand and prices remained sluggish. East, North and Central markets, in particular, were the worst hit," said Birla Corp. Weak monsoon and widespread unseasonal rain during the last quarter of the year in the North and Central parts of the country reduced cement demand.
The performance of the company was 'severely impacted' due to coal shortages. According to Birla Corp, it had to procure coal from the open market, including imports, at a substantially higher cost. "The grid power rates have gone up. Also, the cost of power generation by the company increased due to the purchase of coal from the open market. Though road freight cost came down during the year on account of lower diesel prices the saving was negated by higher railway freight," it added. High limestone costs also added to the production cost.
"With the prediction of weak monsoon in the current financial year, the demand from the rural market may be impacted adversely," said Birla Corp. However, initiatives such as developing infrastructure, smart cities, 'Make in India,' concrete roads and an increase in the allocation of funds to states is likely to help improve the demand. "While signals are positive, ground-level actions will help 'rev up' the economy. It is expected that the demand - supply mismatch will reverse for the better, with a slower pace of capacity addition. Proposed implementation of Goods and Services Tax (GST) is expected to simplify the tax structure, benefiting the cement industry."
India: The Meghalaya High Court has approved the de-merger plans between Star Ferro and Cement Ltd (SFCL), Shyam Century Ferrous Ltd and their respective shareholders. The company's board had approved a de-merger scheme in 2014 under which a new company, Shyam Century Ferrous Ltd, was formed to separate the company's ferro alloy division as part of an overall business reorganisation plan.