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Titan income plummets by 46% in 2011 11 November 2011
Greece: Titan has reported a 46% decrease in income for the first nine months of 2011. The group attributed the fall to a 'rapid decline in construction activity in Greece' in conjunction with the ongoing Greek debt crisis.
Income for the first nine months of 2011 was Euro52.9m, a year-on-year fall of 46.2% from Euro98.3m in 2010. The year-on-year quarterly decline was less severe dropping 1.7% to Euro30m in 2011 from Euro29.5m in 2010. Earnings before interest, tax, depreciation and amortisation (EBITDA) fell by 15.5% to Euro219.8m for the first nine months of 2011 from Euro 260.3m in 2010. Turnover fell by 18.4% to Euro838.9m in the first nine months of 2011 from Euro1028.5m in 2010.
Aside from the domestic construction slump, the group also cited continuing low levels of demand in the US and the slowdown recorded in Egypt during the third quarter of 2011. Increased prices for liquid and solid fuels also had a negative impact on production costs. In addition the depreciation of the Egyptian Pound as well as the Turkish Lira against the Euro negatively impacted results. At constant exchange rates, the group predicted that turnover would have declined by 14%, while the decline in EBITDA would have stood at 10.5%.
FLSmidth cuts 2011 cement capacity growth forecast 10 November 2011
Denmark: FLSmidth's profits have fallen by 12% year-on-year for the third quarter of 2011. The company has subsequently cut its estimate for world cement capacity growth in 2011, blaming stalled activity in India. Group profit was hit by weaker sales in its cement division despite higher sales in its minerals machinery business.
The profit for the quarter ending 30 September 2011 profit fell by 12% to Euro54m from Euro62m in the same quarter of 2010. For the nine months to 30 September 2011 profit fell by 8% to Euro117m from Euro128m in 2010. Total group revenue rose by 5% for the third quarter to Euro743m from Euro706m in 2010.
In the group's cement sector revenue for the nine months to 30 September 2011 decreased by 18% to Euro776m from Euro950m in 2010. Quarterly revenue for cement has fallen upon each consecutive quarter, with one exception, since the end of 2009.
"We cannot say how long the growth pause will last but it will definitely also extend into 2012," said chief executive Jorgen Huno Rasmussen, adding that India will continue to be a large and promising market.
The group said that it now expected the cement plant market in 2011 to grow by about 55Mt of new contracted cement kiln capacity worldwide, excluding China, against an earlier forecast of 65Mt. India is now expected to account for approximately 10Mt/yr compared to the previous projection in 2010 of approximately 20Mt/yr. Emerging markets such as Russia, South America, Africa and Asia were singled out for their high activity.
Unrest in North Africa hit cement consumption and investment in the region in the first nine months of 2011, the company said, adding that activities in Libya might resume in 2012 as the country headed towards greater stability.
Holcim blames 32% income drop in third quarter on strong franc 09 November 2011
Switzerland: Holcim has blamed a 32% fall in income for the third quarter on the strong Swiss franc.
Holcim's income fell by 32% to USD460m in the third quarter from USD680m in the second quarter of 2011. Over the nine months to 30 September 2011 its income fell by 18% year-on-year to USD1.1bn from USD1.4bn in 2010. Sales mirrored this decline, falling year-on-year by 6.1% to USD5.9bn over the nine months to 30 September 2011 compared to USD6.3bn in 2010. The decline in sales between the second and third quarters was similar at 6.7%.
Despite the fall in total group income and sales, sales of cement rose in both the nine-month and quarterly period. For the nine months to 30 September 2011 sales rose by 5.2% to 108Mt from 103Mt. For the quarter ending 30 September 2011 volume sales rose by 6.2% to 37.2Mt from 35Mt in the quarter ending 31 July 2011.
"The strong appreciation of the Swiss franc during the first half of 2011 continued to negatively impact the financial result during the quarter, albeit to a lesser extent than during the second quarter," said Chief Financial Officer Thomas Aebischer. Holcim's sales during the three months to 30 September 2011 were reduced by USD948m by the currency. Operating earnings before interest, taxes, depreciation and amortisation (EBITDA) were reduced by USD200m, according to Aebischer.
As expected, Holcim noted that many emerging markets enjoyed brisk construction activity. In the Eurozone and in North America growth mainly remained restrained. The Latin America cement sector achieved the strongest rise in sales volumes, followed by Asia Pacific and Europe. In particular, the group's companies in Russia, Singapore, Indonesia, Colombia and Australia made larger contributions in Swiss francs to the sales. Where other group companies improved their results in local currency terms these successes were cancelled out overall by the strong Swiss franc.
In its outlook Holcim has pinned its hopes for consistent growth in the emerging markets of Latin America and Asia whilst singling out Africa and the Middle East for continued poor trading. In Europe and North America Holcim's intends for its lean cost structure to enable it to benefit more than average from any economic recovery. Lastly, the group mentioned that the sharp global rise in energy, raw material and transportation costs call for further price adjustments.
Italcementi reports third quarter profit drop 08 November 2011
Italy: Italcementi has reported a 51.7% fall in third quarter net profits to Euro25m despite the sale of its assets in Turkey earlier in 2011.
The profit over the nine months to 30 September 2011 was up at Euro123.2m from Euro18.5m in 2010, with the group saying that cement sales were up in Belgium, France, North America and in the emerging markets of India, Morocco and Thailand. Total group sales remained almost unchanged at Euro3.6bn for the same period. Italcementi's cement sector reported Euro2.3bn for the first nine months of 2011, a drop of 8.4% from Euro2.5bn in the same period in 2010. Cement sales volumes remained steady at 38.9Mt. The group reported a contraction in Egypt due to the civil unrest there and said there was, "stagnation in some industrialised economies."
"The positive results seen on emerging markets where, with the exception of Egypt, sales volumes rose by around 3%, confirms their strategic importance," said Italcementi's chief executive Carlo Pesenti in a statement. "More than 60% of our production capacity is located in these regions and this will increase in the near future with the new development projects recently set up in India," Pesenti continued.
The group said the profit fall was due to 'the unfavourable dynamic of operating costs and exchange rate effects' Italcementi sold equity investments in Turkey for Euro133.4m earlier in 2011 and said it would continue with cost cutting.
"While the Egyptian market will still be affected by political instability and increased local competition, the rest of the group should generate improved operating results, also thanks to positive price trends in Italy," it said. "In the fourth quarter, the group should record a decline in operating results that will be less than those of the previous quarters," it said, adding that it expected a 'significant improvement' in net profit for 2011 overall.
Heidelberg leads interest in join venture with RINL 07 November 2011
India: Heidelberg and major Indian cement companies including UltraTech and Reliance Cements have shown interest as joint venture partners in state-run Rashtriya Ispat Nigam's (RINL) proposed USD204m cement plant at Vizag, in Andhra Pradesh.
"We are looking for a partner to set up a 3Mt/yr plant at Vizag. Heidelberg, Ultratech and Reliance Cements have shown interests to be our joint venture partner," RINL Chairman and Managing Director A P Choudhary said. Zuari Cements, Bhavya Cements, JP Cements and Binani Cements have also shown interests in the joint venture.
"The finalisation of the partner will not take more than 2-3 months from now. We will be able to establish the joint venture before the end of the current fiscal year," Choudhary said.
Asked how much of a stake the steel-maker would offer to its partner, Choudhary said that no decision has been taken yet. However RINL is willing to give up to 74% to the partner since cement making is not its core business. The proposed venture will use fly ash and slag generated from RINL's Vizag plant, where the capacity will shortly be increased from 3Mt/yr to 6.4Mt/yr.
Around USD204m in investment will be required to set up the cement plant, Choudhary said, adding that the cost would be borne by the two firms according to the shareholding pattern. Production at the plant is likely to commence two years from the start of construction.