Mexico recovers while Brazil remains challenging
Holcim Mexico sold more cement in 2014, driven by the overall more favorable economic situation that has led to increased cement demand but also thanks to a variety of commercial measures. The Group company continued to export clinker to Holcim Ecuador in 2014. Volumes in aggregates and ready-mix concrete declined significantly, impacted by the closure of several plants in 2013 based on the strategy to focus on the most profitable markets and customers.
Following a year with solid volumes fueled by major road infrastructure projects, El Salvador delivered less cement in 2014. Volumes in all three segments for Holcim Costa Rica were down, reflecting the slower growth of the national economy and the impact of lower exports. Holcim Nicaragua continued to increase cement volumes in 2014, despite additional capacities of competitors having come on stream in the year under review.
Cement volumes at Holcim Colombia improved slightly as the Group company’s cement plant operated close to capacity and competition increased. With a stronger focus on margins ready-mix concrete deliveries were up.
After Holcim Ecuador reported solid cement volume growth over the last years, with 2013 being a record year, the Group company was affected by the country’s declining cement consumption in 2014. Public investment was subdued as a result of liquidity restraints by the government. Subsequently, deliveries in all three segments declined.
Brazil’s economic situation remained difficult following the Soccer World Cup and 2014 federal elections. Holcim Brazil, with its presence in the southeast of the country, could however increase cement sales supported by strong demand mainly in Rio de Janeiro but also in Sao Paulo and Espirito Santo. The development in Minas Gerais however was less favorable. Following the strategic rightsizing of the ready-mix concrete business last year, volumes decreased in this segment.
In Chile, Cemento Polpaico suffered from the challenging economic situation in 2014 and reported volume declines in all three segments. As mining projects came to an end in the year under review, ready-mix concrete deliveries were negatively affected, following a peak in 2013. Subsequently, intra-company cement sales also declined as a result of this development.
As construction is considered a safe way to preserve the value of money in the context of the Argentinian recession, declines in cement consumption were less pronounced than in other industries. However, Holcim Argentina sold less cement in 2014 following the very good performance of the year before. Aggregates and ready-mix concrete volumes were down significantly as a result of the lack of infrastructure investment.
Consolidated cement volumes in the Group region Latin America were down by 1.5 percent to 24.6 million tonnes in 2014. In aggregates deliveries declined by 26.4 percent to 7.5 million tonnes and in ready-mix concrete shipments contracted by 20.0 percent to 6.4 million cubic meters, both mainly as a result of the strategic rightsizing-efforts in the Group region implemented in 2013. Net sales in the Group region Latin America were down 10.0 percent to CHF 3 billion.