PERU: Aumentó utilidad neta de Cementos Pacasmayo

Durante la primera mitad del año, la utilidad neta de Cementos Pacasmayo se incrementó en un 19.4% con respecto a similar periodo del año pasado. Así, la empresa cementera registró unos S/. 96.5 millones entre enero a junio de este año.

Entre los factores de este incremento, la empresa señala un mayor margen bruto registrado, una ganancia de S/. 8.8 millones por la venta de un terreno y una mejor administración de riesgo en el tipo de cambio con moneda extranjera. Asimismo, durante los primeros seis meses del 2015, Cementos Pacasmayo invirtió S/. 247.5 millones, enfocados en su nueva planta de cemento y otros proyectos en Pacasmayo, Rioja y Piura.

Planta de cemento

La empresa reitera que la nueva planta de cemento de US$ 386 millones en Piura ya se encuentra en su etapa final de construcción y se estima que la producción de cemento está programada para inicios del tercer trimestre del 2015, mientras que la de clínker comenzaría a operar en el cuarto trimestre.

Para finales de año, la empresa espera llegar al 60% de capacidad de las 1.6 millones de toneladas de cemento y 1 millón de toneladas de clínker.

Proyectos

También señala que, con respecto a su subsidiaria Fosfatos del Pacífico (fertilizantes), el proyecto está en proceso de incorporar los hallazgos de ingeniería de valor de un nivel conceptual a un nivel de ingeniería básica.

En el caso de Salmueras Sudamericanas (sales y fertilizantes), el proyecto está siendo estudiado por los socios (Pacasmayo y Quimpac) para determinar cómo continuar de acuerdo a las prioridades de inversión.

NIGERIA: Lafarge's 220mw Power Plant Begins Operations October

Lafarge Africa Plc has said its newly constructed 220 megawatts power plant at Ewekoro, Ogun State will commence operation in October.

The News Agency of Nigeria (NAN) quoted the CEO, Lafarge Nigeria, Mr. Guillaume Roux, to have said the project worth $400 million (N78.8 billion) was executed in partnership with the International Finance Corporation (IFC) and Wartsila.

He said IFC would provide financial and advisory services for the project through InfraVentures, its Global Infrastructure Project Development Fund, while Wartsila would build and manage the power plant.

Roux expressed the hope that the project would enhance 1.4 million households’ access to electricity and help mitigate energy problems of many firms in the country.

He said power project remained one of the company’s contributions toward providing an enabling environment for new investments and the nation’s economic growth.

NAN reported that the Nigerian Electricity Regulatory Commission (NERC) had licenced embedded power companies to boost electricity supply in the country.

Embedded power companies are not primarily power generating companies, but they generate extra power from their operations and sell the surplus to the national grid or the distribution companies. Africa and the Middle East contribute 18 per cent to the company’s turnover in 2014. Nigeria represents about three-and-half per cent of the company’s turnover from Africa in 2014.

Zambia: Cement Price Reduction Welcome

Is it not interesting to note that while prices of a good number of commodities are said to be going up, the price of cement, which is one of the most important materials in construction, is going down?

The aforesaid situation has been compelled by Government's prudent measures set to create an environment where competition ultimately benefits local buyers.

Not only has production of cement among the three cement producing companies increased, but the firms have also increased selling points and created job opportunities.


Larfage, Zambezi Portland and now Dangote are now competing in the production and distribution of cement in Zambia and beyond.

A survey taken recently revealed that prices of cement that at one time had gone up to as high as K98 has reduced to K58 on average.

Larfage Zambia has in the recent past improved new cement-making plants, machinery and opened new selling points across Zambia.

Zambezi Portland Cement also increased production of cement to 1,500 tonnes per day following the investment into machinery worth US$4 million.

Zambezi Portland Cement even went a step further by slashing the price of cement from K66.00 to K58.50.

Zambezi Portland Cement operations director Daniele Ventriglia was recently quoted that the company had acquired state-of-the art equipment and subsequently increased production to 1,500 tonnes per day from 1,100 tonnes per day.

He said the ZPC management was geared to maintain the seamless supply of cement onto the Zambian market by increasing production, hence the decision to invest in new machinery worth $4 million.

Dangote Cement did not mince words, when prior to commencement of production, warned of competition in the industry and has since proved that fact.

The Zambia Consumer Association is on record to have praised the coming of Dangote Cement to Zambia, saying it would reduce the cost of cement on the local market.

Cement price reduction aims to serve the Zambian construction sector by ensuring that the market continuously receives cement without any burden.

Credit goes to the Zambian Government for creating such a deliberate policy at a time when construction of roads and buildings is at peak.

One would have thought that going by the notion of increased prices, whenever demand for any commodity was high, the opposite prevails in Zambia to the benefit of local consumers.

As a result of reduced prices of cement, Zambia has not only seen massive infrastructure development but encouraged local people to build own houses and create jobs.

EGYPT: Suez Cement net profit down 61.8% YOY in 1H of 2015

Suez Cement’s net profit registered EGP 118.9m in the first half (1H) of 2015, compared to EGP 311.9m in the same period of 2014, the company announced, referring to its consolidated financial statement.

On a quarterly basis, net profit for the second quarter (Q2) marked EGP 60.9m, down from EGP 142.5m in Q2 of 2014, the company said.

Suez Cement is seeking to increase its energy intake and its production capacity by 15%, according to Bruno Carrè, the company’s Managing Director in Egypt, during the Milan Expo 2015. He added that the company will not file a request to obtain a new cement licence.

Carrè also announced in March that the company will convert two new facilities to coal in 2015, adding to two facilities that were converted in 2014.

“We are investing some EGP 400m per year for four years,” Carrè said. “We have done one and we converted two plants and we have another two plants to complete.”

Carrè had previously stated that he expected Suez Cement’s revenues to keep growing in 2015 at a rate of 10% to 15%.

On 26 March, the company donated EGP 30m to the Long Live Egypt fund. A cheque worth EGP 10m was given to Prime Minister Ibrahim Mehleb. The remaining EGP 20m will be given over the next two years, with EGP 10m each year.

Following the government’s approval in April last year to use coal as a source of energy in the industrial sector, cement companies in Egypt took steps to commence testing coal in thermal power generation.

Last May, cement factories faced difficulties as they said the specifications set by the Ministry of Environment on trade, transport, coal storage, and the energy mix, are stricter than European specifications.

CHINA: Shanshui Cement Shareholders Mull Takeover Offer for Company

China Shanshui Cement Group Ltd. said two of its largest shareholders are considering a takeover bid in the latest escalation of a fight for control over the company.

Taipei-based Asia Cement Corp. and China National Building Material Co., which together own about 38 percent of Shanshui Cement, are considering a cash offer to acquire the shares they don’t already control, according to statements to the Hong Kong stock exchange Tuesday.

Asia Cement and China National Building may be seeking to scuttle an attempt by Tianrui Group to gain control of the cement maker ahead of a key meeting on July 29. Tianrui, the single largest shareholder with a 28.2 percent stake, wants to remove seven board members, including Chairman Zhang Bin, and appoint its nominees at the meeting.

Asia Cement and China National Building are opposed to the motion.

Shanshui’s 7.5 percent $500 million bonds due 2020 rose 3.18 cents on the dollar Wednesday morning to 93.71 cents as of 9:15 a.m. in Hong Kong, the highest since June 9, according to Bloomberg-compiled prices. Shares of the company are suspended in Hong Kong.

Zhang’s removal could trigger a “change of control” event, allowing holders of the $500 million bonds due March 2020 to demand immediate repayment at 101 percent of face value. China Shanshui Cement has said it won’t have enough funds to repay the debt in time.

Weak Prices

Building material producers and construction companies are struggling in China amid a slowdown in the real estate market. Fitch Ratings cited weak cement prices when it downgraded Shanshui Cement in June to B+, four levels below investment grade. The company’s average product sales price has fallen around 10 percent this year, compared to the same period in 2014, according to Shirley Han, an analyst at UBS AG in Hong Kong.

Shandong-based Shanshui Cement said in May that more than 2,400 employees have filed lawsuits in Hong Kong since August against an ex-director Li Yanmin and founder Zhang Caikui, who owns 38.5 percent of its second-largest shareholder China Shanshui Investment. The claims include a misappropriation of share interests those employees owned.

Shanshui Cement said some banks halted new loans and suppliers demanded immediate repayment after Hong Kong’s High Court placed more than 40 percent of Shanshui Investment shares into receivership until the employee claims are ruled on.

Tianrui boosted its stake in Shanshui Cement in April, causing the free float to fall below the threshold needed to maintain a listing in Hong Kong. The shares, which have a market value of $2.74 billion, have been halted from trading since.

No binding agreement on the possible takeover offer has been entered by any of the parties and terms have not been finalized, according to the Tuesday statements.

PERU: Utilidad neta de Unacem subió 23% en el primer semestre

La utilidad neta de la empresa totalizó S/.151 millones entre enero y junio, y fue impulsada por un control de costos y el precio promedio del mix de productos.

El resultado se dio pese a los mayores gastos financieros de la empresa (S/.114.1 millones, +107.0% s/s) y a las pérdidas por diferencia de cambio (-S/.181 millones).

Con un estricto control sobre los costos de venta y los menores gastos operativos (-9.1% s/s), la utilidad operativa ascendió a S/.455.7 millones, 93.4% por encima de lo registrado en el primer semestre de 2014.

En tanto, al cierre del segundo trimestre del 2015, los resultados financieros de Unacem mejoraron gracias al control de costos y el mix del producto de la compañía; sin embargo, los niveles de apalancamiento de la compañía siguen siendo elevados.

Tras la emisión internacional de bonos de US$675.0 millones en el 2014, el apalancamiento patrimonial (Pasivo/Patrimonio) a junio del 2015 se estima en 1.27x y el ratio deuda financiera/ebitda en 4.5x.

Asimismo, las ventas de Unacem totalizaron S/.475.6 millones en este último trimestre (+6.7% t/t) y S/.957.6 millones en el prime semestre (+9.5% s/s) y el mayor precio promedio del mix de producto compensó la disminución en los despachos de cemento (-2.6%) en regiones de distribución clave.

OMAN: Oman Cement profit hit by gas price increase

Doubling of the natural gas price from January this year has substantially pulled down the net profit of Oman Cement Company, the second biggest cement producer in the Sultanate, by 40 per cent to OMR5.44 million for the first half of this year, from OMR9.09 million for the same period of 2014.

On January 1, the Oman government doubled the natural gas price for industries to 41 baisas per standard cubic metre (cc) from 20.5 baisas per standard cc, with an inbuilt annual increase of 3 per cent thereafter.

The impact of the revision affected the net earnings of gas-intensive local industries like cement, ceramic tiles, steel and glass manufacturers, since a sizeable portion of their manufacturing cost is for fuel.

Oman Cement said that the fall in profits was mainly due to the higher energy cost.

“We have, however, continued our efforts to minimise the impact by better cost and selling price management,” said Oman Cement in its first half results.

The profit before tax for the six-month period also dipped by 39.26 per cent to OMR6.02 million for the first half of 2015 from OMR9.92 million for the same period of last year, which also included an amount of OMR2.1 million being income on sale for available-for-sale investments.

The company’s sales revenue was slightly lower at OMR25.53 million for the first half of this year against OMR25.68 million for the same period last year, while total income stood at OMR25.71 million, against OMR26.04 million during the period under review.

New cement mill

Referring to the progress on expansion programme, Oman Cement said its new cement mill of 150 tonnes per hour capacity (with supporting infrastructure of cement silos and bulk dispatches) is expected to be completed in the fourth quarter of 2015.

The company is also taking efforts to reduce emission levels and accordingly awarded a contract for upgrading pollution control equipment for line -2 to FLSmidth with a total value of $11.3 million. The work has already been started and the project is expected to be ready by the second quarter of 2016.

Oman Cement’s production fell by 2.33 per cent at 1,008,779 tonnes of cement in the first half of 2015, from1,032,898 tonnes for the same period last year, mainly due to limited availability of clinker.

“We had targetted higher levels of clinker production during the period. However, due to technical constraints resulting in the prolonged shutdown of our kiln 3 which was under planned maintenance shutdown, our clinker production remained lower than planned. With the efforts of our technical teams, the kiln has now commenced production and we expect better operational performance in future,” said the company.

NEW ZEALAND: Onehunga wharf to lose cement boats

Cement boats docking at Onehunga port are set to become a thing of the past.

Holcim New Zealand is constructing a new cement silo at the Waitemata port and cement ships will relocate from the Onehunga Port to the new site.

At present the Ports of Auckland-owned Onehunga wharf is closed to the public.

Despite the relocation, a Holcim spokesperson says Onehunga Port will continue to be used by the company as a bagging plant and the silos will remain operational.

The port is also used for shipping container storage and as a base for the Sandford fishing fleet.

Bronwen Turner from the Manukau Harbour Restoration Society says the relocation of the boats provides an opportunity for the development of the wharf as a community amenity.

Results from an AUT University survey on the use of tourism potential of the Manukau Harbour were released in November 2014, showing overwhelming support for the redevelopment of the wharf.

An 18-month investigation carried out by ferry giant SeaLink was completed in September 2014. It looked at whether a service could operate from Onehunga to areas like Clarks Beach and Waiuku.

However a ferry service would need access to the port, Turner says.

"Its the only wharf we have in the Manukau Harbour. It is really the lynch pin to having a ferry service operating in the harbour."

A spokesperson for Ports of Auckland said the wharf will stay closed to the public for now, but did not rule out a change in the future.

"There are a lot of heavy freight movements associated with these operations and it would not be safe to open the port to the public.

"It is clear that there is potential for the wharf to be developed along the lines of the Wynyard Quarter at some point in the future. 

"It will be important for the community to be involved before any plans are put in place."

The new Holcim Waitemata terminal is expected to be completed by mid 2016, with the relocation of the cement boats planned shortly after.

WORLD: Sustained Global Cement Demand Growth Expected

Global cement consumption is expected to record sustained growth in 2015, with further gains forecast for 2016, according to analysis presented in the recently-released Global Cement Report Eleventh Edition.

The report, which covers key cement market data for over 170 countries, reveals that total world consumption rose by 2.6 per cent in 2014 to 4140Mt, compared to the 7.7 per cent growth achieved in 2013. Global demand growth has been driven by the phenomenon of China, which has increased its share of world consumption to reach 59 per cent in 2014.

Closer analysis shows that steady growth has prevailed in the emerging markets where in 2014 consumption (excluding China) increased by 2.7 per cent 1387Mt. In the mature markets of Europe and North America, overall demand growth returned to positive territory in 2014, rising by 2.8 per cent to reach 290.6Mt.

Leading markets 

The top five consuming nations in 2014 were China, India, USA, Brazil and Russia. A total of 10 Asian countries are represented in the top 20, and while two east Asian nations - the Philippines and Malaysia - entered the top 20 for the first time, France and Italy fell out, reflecting the decline of western European consumption. 

Demand in China reached a record 2462Mt, translating into an annual increase of 2.6 per cent - the slowest growth rate in decades and well below the double-digit levels seen in recent years. These indicators suggest that the country is nearing peak demand for cement as the construction industry resets to a slower, more sustainable growth path.

In terms of regional performances, North America has been leading gains in the developed world where last year demand rose by a vigorous 8.2 per cent in 2014 versus 3.9 per cent a year earlier.

The best-performing regions across the world over the 2012-14 period have proved to be in the emerging markets of sub-Saharan Africa, led by central Africa with double-digit rate increases in each year.

Growth outlook 

Looking ahead, general improvements in global growth trends are expected in 2015 and 2016, with forecasted increases of 3.3 and 4.6 per cent, respectively. North and central Asia are set to excel, as will much of Africa. Overall growth in Asia is forecast to be around 3-5 per cent, partly reflecting China's expected lower growth course. The Middle East and western Europe are expected to rebound, but obvious downside and political risks prevail.

UK: New cement producer opens for business

Aggregate Industries has become the UK’s newest cement producer after taking control of major cement plants in Cauldon, Staffordshire and Cookstown, County Tyrone, Northern Ireland.

Becoming a cement producer and supplier is the final piece in the jigsaw for Aggregate Industries, allowing the firm to offer contractors a full range of heavyside construction materials.

Lafarge was required to offload its Tarmac business in the UK with the exception of two plants, a quarry at Cauldon Low and a cement terminal at Belfast Docks, as a condition of its global merger with Holcim.

The transfer was finalised yesterday and sees 250 staff switch to Aggregate Industries, itself part of new LarfargeHolcim group.

Irish rival CRH will take control of the rest of the Tarmac business.

Pat Ward, CEO, Aggregate Industries, said: “These are exciting times for Aggregate Industries. Along with the wider benefits of being part of the new LafargeHolcim group, the integration of cement production represents a significant strategic opportunity for us.

“We’re now able to offer our customers the full range of construction materials and solutions, while maintaining our high levels of customer service.”

Given the strength of the Lafarge cement brand, Aggregate Industries will continue with this branding for its bulk cement products, although some bagged products will be renamed in due course.

The new cement division will be led by Joe Hudson, managing director, Cement & Concrete Products. He joins Aggregate Industries from Lafarge, where he has worked in a number of key functional and operational roles since 2001.

USA: Local cement facilities under new ownership in the Quad Cities area

Continental Cement Company has closed the deal to exchange a Bettendorf facility and cash for a cement plant and seven cement distribution terminals from Lafarge.

Continental’s parent company, Denver-based Summit Materials, bought the facilities – collectively known as the “Davenport Assets,” from Lafarge North America for $450 million in cash plus Lafarge gets the Continental/Summit cement distribution terminal in Bettendorf, Iowa.

The purchase doubles Continental’s cement capacity, giving Continental 2.45 million tons of cement capacity and eight cement distribution terminals along the Mississippi River between Minneapolis and New Orleans.

The purchase includes Continental acquiring the cement plant in Buffalo, Iowa.

“The newly acquired cement operations are a complementary fit with Continental’s existing cement plant in Hannibal, MO and cement distribution terminal in St. Louis, MO. The combined business will operate as Continental Cement Company,” said a statement from Continental’s parent company.

The announcement comes a week after the announcement that the Lafarge-Holcim global merger was completed in mid-July.