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We are not only a supplier, but also a partner

Published

9 years ago

July 4, 2016

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Andre Tissen Director, Center of Competence: Cement, at BEUMER Group in Beckum.

The BEUMER Group has established a Center of Competence for the cement industry in order to provide optimal systems and installations. Andre Tissen, Director, Center of Competence: Cement, at BEUMER Group in Beckum, speaks on the unit?s operations and the challenges that lie ahead for his organisation.

Tell us more about your tasks and the goals that you have set yourself.
As the head of the Center of Competence (CoC) for the cement business, a centre with global responsibility, I am responsible for developing this business segment. This includes optimising and expanding the range of products we offer, as well as supporting the individual group companies. Because only by coopera-?ting with our international group companies can we offer comprehensive support to our customers and expand into new markets.

Can you give an example on how customers can benefit from the CoC?
We have experts in the cement industry with extensive knowhow, who are located all over the world. The CoC helps us to bundle their knowledge and make it accessible to the individual group companies. This will benefit customers in the United States, as well as users in the Philippines or in Germany. The CoC allows us to offer global support. The customer will have access to a competent expert, 24 hours a day.

You mentioned the continuous development of products. What are you working on at the moment and what does the current situation look like?
We continue to optimise all of our machines and systems. One of the trends is that more and more clients want to receive their systems in a turnkey state. They want the systems to come from one single source that means not only individual machines, but a combination of several machines, a complete system where the individual components are perfectly compatible. This means that automation will become increasingly important. BEUMER Group is very well positioned, which is a big advantage for us. Our sortation and distribution systems have a high degree of automation and are successfully used in distribution centres world-wide. We are one of the global leaders in this business segment. Experiences gained in one sector can often be used and transferred to another.

BEUMER Group provides the customer with complete turnkey packaging lines. We design, install and commission the machines and systems, and, if necessary, integrate the products of subcontractors. Our customers entrust us with the complete responsibility. In addition, there are changing types of problems; cement manufacturers, for example, are using more and more secondary fuels, such as tyres and household waste. Our systems constitute the appropriate conveying solutions for this kind of material.

What does the Chinese market for your solutions for the cement industry look like?
China remains an important market for us. It has calmed down a little though, because the clinker capacities in China are reaching their saturation limit. There are two major general contractors in China that are currently building about 70 per cent of new clinker production lines world-wide. Those companies sell their products to more than 20 countries, with a main focus on the Middle East, Africa and Asia. For several years now, they are relying on different BEUMER Group systems such as apron conveyors, bucket elevators and palletisers.

Where are the current growth markets for the cement industry?
The core regions for us are currently Africa, the Middle East and South-East Asia. One interesting customer in Africa, for example, is the cement manufacturer Dangote Cement PLC. It is a worthwhile investment here, even for small companies, because the demand for cement is continuously rising due to the persistent construction activity in many parts of Africa. The demand for large-scale plants is particularly high. The US market is getting more and more interesting as well because it is becoming more stable. We still believe the Russian market shows great promise. We are expecting a strong demand as soon as the political situation has stabilised. Our Russian group company is represented in almost every region of Russia and the states of the former Soviet Union.

Despite the political events of the last few months, we want to continue our successful cooperation with the Russian partners based on mutual trust.

What does the market situation look like in Germany?
There is a lot more going on now, here in Germany, than in previous years. There are mostly modernisation projects of existing cement plants. There is, for example, a strong demand for conveying systems for alternative fuels.

Which are the most requested BEUMER products in the cement industry at the moment?
There are our bucket elevators, filling systems, palletisers and the high capacity packaging system, BEUMER stretch hood. We sell it to companies in all industries, but particularly to the building material industry, where it is used to package palletised bags filled with cement, mortar, limestone and gypsum. Our innovative BEUMER fillpac? is in high demand too. It?s an efficient and optimised filling technology. Our bulk loading heads are often used to load bulk materials quickly and without dust. They are designed with a double-wall system, separating the material inlet and the dedusting unit. Our loading and palletising systems, for example, can automatically load bags of bulk material directly on to the trucks. This is a very efficient option which would otherwise require several workers. This is particularly interesting for emerging market nations, where the transhipment of bagged bulk goods is increasing and labour costs are climbing. We offer our curved belt conveyors as troughed belt conveyors and pipe conveyors that can transport different types of bulk material over long distances and through oftentimes rough terrain.

Tell us something about the competitive situation in the cement industry; do you compete with many global companies?
Our main competitors are predominantly from Germany and our neighbouring European countries. If we want to keep our leadership position, our systems and machines always have to be one generation ahead of our competitors. This is the standard we have set for ourselves. One of our unique selling points is definitely that BEUMER Group is one of the few companies that covers the entire portfolio, from the quarry to the palletised and packaged cement bag.

How do you stay up-to-date with the customer?s needs in order to remain competitive in the future?
Our employees from our branches world-wide keep their fingers on the industry pulse. They are permanently in touch with the customers. This is how we can react quickly to emerging trends. We also hold regular workshops with the leading cement manufacturers. One of the advantages of being a global company is that we can react to regional differences. Automation is one of the topics that is very important to our European users to remain competitive. It plays a smaller role in other countries and regions. Our employees know the local particularities and will find the most suitable solution.

How has the demand pattern changed over the years?
More and more customers want the worry-free package. This can be the deciding factor for keeping the competitive edge. Our customers expect us to assume the responsibility for the entire project and, upon completion, just "hand over the key", so to speak. Comprehensive customer service becomes increasingly important. During machine downtimes, customers expect us to respond quickly. The service agreements are individually tailored to the customer?s needs. They can range from only maintenance and inspection to a long-term placement of our service personnel on site. The ?Residential Service? includes technical support, preventive maintenance and inspection, emergency plans, system and process analyses and optimisation as well as spare parts and facility management. The relationship with the customer becomes more and more important. I like to compare it to a good friendship that is based on mutual trust. We are not only a supplier, but also a partner. A good relationship, in my opinion, is based on giving and taking. The two partners should be able to maintain an open dialogue.

How do you handle systems from third parties?
We support our customers in all matters, even with the repair of third-party systems. We also modify and modernise systems from our competitors.

Is the purchase price more important to customers than the long-term costs?
The cement market is in a harsh situation due to the global crises. This is why many customers are basing their decisions on price. We are trying to counteract this trend by offering sustainable solutions to our customers, so that they can reduce their costs in the long term. We want to be able to offer our products at a better price while maintaining the same quality. One major advantage for our customers GC? our systems and machines come in a modular system. So depending on their individual requirements, they can add modules to extend our basic version.

Raising the bar
BEUMER supplies world?s highest bucket elevator to Indian cement manufacturer ACC Ltd., part of the Lafarge-Holcim Group, with a capacity of 13,000 tonnes per day at its Wadi factory in Karnataka, has placed an order with the BEUMER Group for a high-performance belt bucket elevator, type ?HGBW-HC?, and measuring 1250 x 175.3 m. With a distance between centres of 175.3 meters, this is currently the highest bucket elevator in the world.

ACC?s decision is the result of the reliable performance of the bucket elevators supplied by BEUMER Group to the same client in the past with heights of 174 m and 171m. The enormous size of this system enables a flow rate of around 600 tonnes per hour to be achieved, ensured by high-quality steel wire belts of particularly high strength.

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Price hikes, drop in input costs help cement industry to post positive margins: Care Ratings

Published

3 years ago

October 21, 2021

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Region-wise,the southern region comprises 35% of the total cement capacity, followed by thenorthern, eastern, western and central region comprising 20%, 18%, 14% and 13%of the capacity, respectively.

The cement industry is expected to post positive margins on decent price hikes over the months, falling raw material prices and marked drop in overall production costs, said an analysis of Care Ratings.

Wholesale and retail prices of cement have increased 11.9% and 12.4%, respectively, in the current financial year. As whole prices have remained elevated in most of the markets in the months of FY20, against the corresponding period of the previous year.

Similarly, electricity and fuel cost have declined 11.9% during 9M FY20 due to drop in crude oil prices. Logistics costs, the biggest cost for cement industry, has also dropped 7.7% (selling and distribution) as the Railways extended the benefit of exemption from busy season surcharge. Moreover, the cost of raw materials, too, declined 5.1% given the price of limestone had fallen 11.3% in the same aforementioned period, the analysis said.

According to Care Ratings, though the overall sales revenue has increased only 1.3%, against 16% growth in the year-ago period, the overall expenditure has declined 3.2% which has benefited the industry largely given the moderation in sales.

Even though FY20 has been subdued in terms of production and demand, the fall in cost of production has still supported the cement industry by clocking in positive margins, the rating agency said.

Cement demand is closely linked to the overall economic growth, particularly the housing and infrastructure sector. The cement sector will be seeing a sharp growth in volumes mainly due to increasing demand from affordable housing and other government infrastructure projects like roads, metros, airports, irrigation.

The government’s newly introduced National Infrastructure Pipeline (NIP), with its target of becoming a $5-trillion economy by 2025, is a detailed road map focused on economic revival through infrastructure development.

The NIP covers a gamut of sectors; rural and urban infrastructure and entails investments of Rs.102 lakh crore to be undertaken by the central government, state governments and the private sector. Of the total projects of the NIP, 42% are under implementation while 19% are under development, 31% are at the conceptual stage and 8% are yet to be classified.

The sectors that will be of focus will be roads, railways, power (renewable and conventional), irrigation and urban infrastructure. These sectors together account for 79% of the proposed investments in six years to 2025. Given the government’s thrust on infrastructure creation, it is likely to benefit the cement industry going forward.

Similarly, the Pradhan Mantri Awaas Yojana, aimed at providing affordable housing, will be a strong driver to lift cement demand. Prices have started correcting Q4 FY20 onwards due to revival in demand of the commodity, the agency said in its analysis.

Industry’s sales revenue has grown at a CAGR of 7.3% during FY15-19 but has grown only 1.3% in the current financial year. Tepid demand throughout the country in the first half of the year has led to the contraction of sales revenue. Fall in the total expenditure of cement firms had aided in improving the operating profit and net profit margins of the industry (OPM was 15.2 during 9M FY19 and NPM was 3.1 during 9M FY19). Interest coverage ratio, too, has improved on an overall basis (ICR was 3.3 during 9M FY19).

According to Cement Manufacturers Association, India accounts for over 8% of the overall global installed capacity. Region-wise, the southern region comprises 35% of the total cement capacity, followed by the northern, eastern, western and central region comprising 20%, 18%, 14% and 13% of the capacity, respectively.

Installed capacity of domestic cement makers has increased at a CAGR of 4.9% during FY16-20. Manufacturers have been able to maintain a capacity utilisation rate above 65% in the past quinquennium. In the current financial year due to the prolonged rains in many parts of the country, the capacity utilisation rate has fallen from 70% during FY19 to 66% currently (YTD).

Source:moneycontrol.com

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Wonder Cement shows journey of cement with new campaign

Published

3 years ago

October 21, 2021

admin

The campaign also marks Wonder Cement being the first ever cement brand to enter the world of IGTV…

ETBrandEquity

Cement manufacturing company Wonder Cement, has announced the launch of a digital campaign ‘Har Raah Mein Wonder Hai’. The campaign has been designed specifically to run on platforms such as Instagram, Facebook and YouTube.

#HarRaahMeinWonderHai is a one-minute video, designed and conceptualised by its digital media partner Triature Digital Marketing and Technologies Pvt Ltd. The entire journey of the cement brand from leaving the factory, going through various weather conditions and witnessing the beauty of nature and wonders through the way until it reaches the destination i.e., to the consumer is very intriguing and the brand has tried to showcase the same with the film.

Sanjay Joshi, executive director, Wonder Cement, said, "Cement as a product poses a unique marketing challenge. Most consumers will build their homes once and therefore buy cement once in a lifetime. It is critical for a cement company to connect with their consumers emotionally. As a part of our communication strategy, it is our endeavor to reach out to a large audience of this country through digital. Wonder Cement always a pioneer in digital, with the launch of our IGTV campaign #HarRahMeinWonderHai, is the first brand in the cement category to venture into this space. Through this campaign, we have captured the emotional journey of a cement bag through its own perspective and depicted what it takes to lay the foundation of one’s dreams and turn them into reality."

The story begins with a family performing the bhoomi poojan of their new plot. It is the place where they are investing their life-long earnings; and planning to build a dream house for the family and children. The family believes in the tradition of having a ‘perfect shuruaat’ (perfect beginning) for their future dream house. The video later highlights the process of construction and in sequence it is emphasising the value of ‘Perfect Shuruaat’ through the eyes of a cement bag.

Tarun Singh Chauhan, management advisor and brand consultant, Wonder Cement, said, "Our objective with this campaign was to show that the cement produced at the Wonder Cement plant speaks for itself, its quality, trust and most of all perfection. The only way this was possible was to take the perspective of a cement bag and showing its journey of perfection from beginning till the end."

According to the company, the campaign also marks Wonder Cement being the first ever cement brand to enter the world of IGTV. No other brand in this category has created content specific to the platform.

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In spite of company’s optimism, demand weakness in cement is seen in the 4% y-o-y drop in sales volume. (Reuters)

Published

3 years ago

October 21, 2021

admin

Cost cuts and better realizations save? the ?day ?for ?UltraTech Cement, Updated: 27 Jan 2020, Vatsala Kamat from Live Mint

Lower cost of energy and logistics helped Ebitda per tonne rise by about 29% in Q3
Premiumization of acquired brands, synergistic?operations hold promise for future profit growth Topics

UltraTech Cement
India’s largest cement producer UltraTech Cement Ltd turned out a bittersweet show in the December quarter. A sharp drop in fuel costs and higher realizations helped drive profit growth. But the inherent demand weakness was evident in the sales volumes drop during the quarter.

Better realizations during the December quarter, in spite of the 4% year-on-year volume decline, minimized the pain. Net stand-alone revenue fell by 2.6% to ?9,981.8 crore.

But as pointed out earlier, lower costs on most fronts helped profitability. The chart alongside shows the sharp drop in energy costs led by lower petcoke prices, lower fuel consumption and higher use of green power. Logistics costs, too, fell due to lower railway freight charges and synergies from the acquired assets. These savings helped offset the increase in raw material costs.

The upshot: Q3 Ebitda (earnings before interest, tax, depreciation and amortization) of about ?990 per tonne was 29% higher from a year ago. The jump in profit on a per tonne basis was more or less along expected lines, given the increase in realizations. "Besides, the reduction in net debt by about ?2,000 crore is a key positive," said Binod Modi, analyst at Reliance Securities Ltd.

Graphic by Santosh Sharma/Mint
What also impressed analysts is the nimble-footed integration of the recently merged cement assets of Nathdwara and Century, which was a concern on the Street.

Kunal Shah, analyst (institutional equities) at Yes Securities (India) Ltd, said: "The company has proved its ability of asset integration. Century’s cement assets were ramped up to 79% capacity utilization in December, even as they operated Nathdwara generating an Ebitda of ?1,500 per tonne."

Looks like the demand weakness mirrored in weak sales during the quarter was masked by the deft integration and synergies derived from these acquired assets. This drove UltraTech’s stock up by 2.6% to ?4,643 after the Q3 results were declared on Friday.

Brand transition from Century to UltraTech, which is 55% complete, is likely to touch 80% by September 2020. A report by Jefferies India Pvt. Ltd highlights that the Ebitda per tonne for premium brands is about ?5-10 higher per bag than the average (A cement bag weighs 50kg). Of course, with competition increasing in the arena, it remains to be seen how brand premiumization in the cement industry will pan out. UltraTech Cement scores well among peers here.

However, there are road bumps ahead for the cement sector and for UltraTech. Falling gross domestic product growth, fiscal slippages and lower budgetary allocation to infrastructure sector are making industry houses jittery on growth. Although UltraTech’s management is confident that cement demand is looking up, sustainability and pricing power remains a worry for the near term.