Gypsum industry news

US: Eagle Materials Inc has reported a 29% rise in total revenue for the first quarter of the 2013 fiscal year which ended on 30 June 2012. The North American building materials producer noted revenue of US$154m for the quarter, up from US$120m in the same period in 2011.

Eagle's gypsum wallboard sector reported a 36% increase in revenue to US$70.2m from US$51.3 in 2011. Improved wallboard net sales prices were the primary driver of the quarterly earnings increase in the company's gypsum wallboard and paperboard division. Sales volumes increased by 11% to 42.5MM² from 38.3MM².

Uzbekistan: Dry gypsum mixture producer Bukharagips JV OJSC has released its financial results for the 2011 calendar year, which show a net loss of US$1.0m in 2011 against a loss of US$0.3m in 2010.

The company decreased production of construction-grade gypsum by 39.6% from 14,027t in 2010 to 11,373t in 2011. The enterprise increased production of crushed stone gypsum by 8.2% to 208,180t. Production of dry construction mixtures rose by 156.3% from 5240t in 2010 to 13,428t in 2011.

The company's net revenue came to US$3.7m in 2011 against US$2.6m in 2010. Its expenses grew from US$1.8m in 2010 to US$2.92m in 2011.

Saudi Arabia: National Gypsum Company has announced interim financial results for the period ending 30 June 2012. These show a net income for the second quarter of 2012 of US$1.76m compared to US$2.7m in the same period of 2011, a year-on-year drop of over a third. There was also a sharp drop compared to the first quarter of 2012, when the company had a net income of US$2.50m. National Gypsum's gross profit for the second quarter of 2012 came in at US$2.26m compared to US$3.39m for the same quarter of 2011, a near-30% fall.

Over the course of the six months to 30 June 2012, the company said that it made a net profit of US$4.26m, compared to US$5.6m in the six months to 30 June 2011. Its gross profit for the six months came in at US$4.65m compared to US$6.73m a year earlier, another drop of more than 30%.

National Cement said that the reason for the drop in its performance was increased competition.

Spain: Uralita SA has released financial results for the 2011 calendar year, which show a net loss of Euro27.1m. The gypsum wallboard and insulation materials producer also saw sales drop to Euro676m from Euro683m year-on-year, with earnings before interest, tax, depreciation and amortisation down by 65% from Euro78.9m in 2010 to just Euro26.9m. The group's revenue was also down marginally, to Euro690.8m, a drop of just 0.2%.

The Spanish construction market remains in the doldrums amid the continued Eurozone debt crisis, drastically reducing demand for gypsum, insulation and the other building materials that Uralita produces. Uralita SA has released financial results for the 2011 calendar year, which show a net loss of Euro27.1m. The gypsum wallboard and insulation materials producer also saw sales drop to Euro676m from Euro683m year-on-year, with earnings before interest, tax, depreciation and amortisation down from by 65% from Euro78.9m in 2010 to just Euro26.9m. The group's revenue was also down marginally, to Euro690.8m, a drop of just 0.2%.

The Spanish construction market remains in the doldrums amid the continued Eurozone debt crisis, drastically reducing demand for gypsum, insulation and the other building materials that Uralita produces.

US: Eagle Materials Inc. has reported its financial results for the 2012 fiscal year and the fiscal fourth quarter that ended on 31 March 2012. Its results showed that the group's revenue was up by 7% for the fiscal year, to US$495m, and cash flow from operations was US$60.2m, up by 37%. In the quarter ending 31 March 2012, the company netted revenues of US$116.8m, a 22% year-on-year increase.

Eagle said that its low cost operations continued to execute well during the 2012 fiscal year and that it was beginning to see improving construction activity across most of its markets. Eagle's earnings began to improve during the second half of fiscal 2012 and accelerated during the fourth quarter.

The group's Gypsum Wallboard and Paperboard division saw an operational income of US$23.3m, an massive increase of 74% compared to the 2011 fiscal year. Revenues from Gypsum Wallboard and Paperboard were US$295.9m for the 2012 fiscal year, 9% higher than that seen in 2011.

The Gypsum Wallboard and Paperboard division reported fourth quarter operating earnings of US$15.1m compared to an operating loss of US$0.4m in the same quarter of the 2011 fiscal year. The increase in operating earnings was primarily due to higher net wallboard sales prices and increased paperboard sales volumes offset by lower wallboard sales volumes.

Gypsum Wallboard and Paperboard revenues for the fourth quarter totalled US$79.9m, a 23% increase from the same quarter in 2011. The average gypsum wallboard net sales price for this quarter was US$118.86/MSF, 39% greater than the same quarter in 2011. Gypsum wallboard sales volumes of 397MMSF were down by approximately 7% from the fourth quarter of the 2011 fiscal year.

US: USG Corporation has reported a net sales increase of 13% in the first quarter of 2012 whilst decreasing its overall net loss. The building materials manufacturer made net sales of US$812m in the three months ending on 31 March 2012 compared to US$721m in the same period in 2011. Operating profit rose from a loss of US$58m in 2011 to a gain of US$27m. However, the company remains in net loss after tax, reducing its loss from US$105m in 2011 to US$27m in 2012.

"Despite continuing low demand our emphasis on achieving operating profit is succeeding and continues to be a top priority," said James S Metcalf, Chairman, President and CEO. "Our focus on our customers, innovation and growing our adjacent businesses contributed to our first quarter results. All units showed improved results, supported by a modest increase in US wallboard demand and solid performance across our product lines including ceilings, substrates and joint compounds."

Of USG's gypsum assets its subsidiary the US Gypsum Company registered the strongest turnaround in the first quarter improving sales by 20% from US$318m in 2011 to US$381m in 2012. Operating profit rose from a loss of US$29m in 2011 to a gain of US$29m in 2012.

"Although demand in our core markets still remains near historical lows, we are confident our strategy will continue to move us toward positive net earnings," said Metcalf.

US: Gypsum wallboard imports in the fourth quarter of 2011 were 72,000t, equivalent to 8MM², a rise of 15% compared to the third quarter of 2011 and 37% year-on-year. Mexico accounted for 59% of these imports, followed by Canada with 41%. The figures were released in the latest gypsum publication from the United States Geological Survey (USGS).

Producers mined 2.18Mt of gypsum during the fourth quarter of 2011, a rise of 8% year-on-year. Synthetic gypsum production was 1.77Mt , a rise of 4% year-on-year. Synthetic gypsum accounted for about 37% of the 4.81Mt total supply of gypsum in the US during the quarter. Sales of calcined gypsum were 2.93Mt, a rise of 8% year-on-year. Sales of board products were 3.73Mt, equivalent to approximately 416MM², a rise of 4% compared to the third quarter of 2011 and a rise of 14% year-on-year. Imports of crude gypsum were 864,000t, a rise of 12% from the third quarter of 2011. The US imported crude gypsum from 10 countries in the fourth quarter of 2011 with Mexico accounted for 40% followed by Canada with 38%, and Spain with 22%.

Wallboard exports were 212,000t, equivalent to 23.6MM², a rise of 6% compared to the third quarter of 2011 and a rise of 18% year-on-year. Wallboard was principally exported to Canada with accounted for 93% of the total.

Belgium: Etex Group has reported a revenue rise of 17.6%, from Euro1.96bn in 2010 to Euro 2.3bn in 2011. In 2011 the Belgium-based manufacturing group acquired major gypsum interests from Lafarge and had a former manager jailed in a major Italian asbestos trial.

Etex acquired 80% of the European and South American gypsum activities of Lafarge in November 2011, increasing its controlling interest to 80% in its South American gypsum business. On a like-for-like basis its revenue increased by 10.3%. The newly acquired gypsum activities added a further 7.3% to the revenue increase from 2010. The Group's operating income decreased by 4.9% to Euro176m in 2011, from Euro185m in 2010. Profit decreased by 29% to Euro88m from Euro 124m.

In its annual report the Group attributed the fall in operating income to the setup of a provision in response to the outcome of the Italian Eternit asbestos trial in February 2011. Etex was judged civilly responsible for the actions of one of its former top managers. Damages from the case were over Euro100m.

US: USG Corporation has reported a net loss of US$30.5m for January and February 2012, compared to US$82.3m for the same two-month period in 2011. The preliminary, unaudited results were announced in connection with USG's ongoing tender offer and consent solicitation relating to its 9.75% notes due 2014.

For the two-month period, USG reported net sales of US$517m and an operating profit of US$5.7m. For the comparable two-month period in 2011, USG reported net sales of US$447m and an operating loss of US$46.8m. The company has attributed the improved year-over-year results primarily to increases in its US average wallboard price and wallboard gross margin.

USG currently expects that operating results for March 2012 will reflect the continuing impact of the wallboard prices and gross margin increases. Complete results for the first quarter are expected to be announced on 17 April 2012.

France: Saint-Gobain has posted a net income of Euro1.3bn for 2011, a rise of 14% from Euro1.1bn in 2010. The group has attributed this to strong demand for its building materials in emerging markets combined with its ability to pass higher raw material costs to customers in the form of higher prices.

Recurring net income spiked to Euro1.7bn in 2011, a 30% rise from Euro1.3bn in 2010. Operating income rose to Euro3.4bn, a 10% rise compared to Euro3.1bn. Group sales increased to Euro42bn, a 5% rise from Euro40bn.

"We managed to limit the impact of the strong increase of raw material and energy thanks to the increase of the prices of our products," said chief executive Pierre-Andre de Chalendar.

De Chalendar added that he expects a moderated growth of revenues in 2012 as the company intends to continue transferring higher costs to its products' prices. He declined to give specific data, though he said the growth will be slower than the 5% in 2011.

In its Interior Solutions division (which includes gypsum) the group recorded sales of Euro5.5bn for 2011, a rise of 6.1% from Euro5.2bn in 2010. Operating income met Euro450m in 2011, a rise of 19% from Euro380m. Notably capital expenditure increased to Euro330m, a rise of 70% from Euro190m. Overall the group doubled investment spending for 2011, in energy efficiency and energy markets, to almost Euro900m.

Sales volumes for Interior Solutions were up in all geographic areas, particularly in the US, Asia and emerging countries. In Western Europe and especially France, trading continued to be buoyed by stricter energy performance regulations.

Saint-Gobain's CEO has announced an ambitious expansion plan to boost total revenues to Euro55bn and net profit to Euro3bn by 2015, through acquisitions and organic growth. The company said the plan to spin off its unit Verallia is still being considered, but market conditions are not favourable in the short term.