Gypsum industry news

Canada: The Canadian International Trade Tribunal has started an inquiry to determine whether the dumping of gypsum wallboard from the US has damaging effects on the local market. The inquiry follows an investigation by the Canada Border Services Agency. The tribunal will determine whether the dumping has caused injury or retardation or is threatening to cause injury to the domestic industry.

The tribunal is an independent quasi-judicial body that reports to the Canadian parliament through the Minister of Finance. It hears cases on dumped and subsidised imports, safeguard complaints, complaints about federal government procurement and appeals of customs and excise tax rulings. It can also offer advice on economic, trade and tariff matters.

USA: GMS Inc. has announced its acquisition of Olympia Building Supplies, LLC, a leading supplier of wallboard and related construction products including steel studs, joint compound, finishing products, insulation and other specialty products to the South Florida market. Founded in 2008, Olympia has grown rapidly from a single location in Pompano, Florida to the current network of three branch locations located in Pompano, Miami and West Palm Beach. Olympia will continue to operate under its current name, which 'has garnered significant respect and brand recognition among professional contractors in its markets. The entire team will join GMS, including its General Manager, Roger Shingler, an established and respected industry veteran.'

Shingler said, "Combining forces with GMS is the right next step in our growth trajectory. GMS shares our passion for customer service and our commitment to providing high-quality products. We have successfully expanded our business to become a leading specialty distributor in Pompano, Miami and West Palm Beach, Florida. We are excited to further improve our ability to serve new and existing customers with the strong support of GMS' national scale, operational expertise, and strong financial position. Being a part of the GMS family is the perfect fit for us."

Chris Doyle, Vice President of the Southeastern division of GMS, added. "We are very happy to welcome the Olympia team to our company. Olympia is an excellent strategic fit for GMS with its broad product offering and loyal customer base in attractive markets. The acquisition of these three established locations in South Florida provides a very complementary addition to our strong existing positons in Central and Northern Florida. Furthermore, the highly seasoned team is driven by success. We look forward to integrating these assets onto our platform and remain vigilant in our pursuit to further strengthen GMS' leadership positions in the Southeast and nationally for years to come."

GMS Inc has also acquired Steven Kempf Building Material Company (SKBM) headquartered in King of Prussia, Pennsylvania. SKBM is a supplier of drywall, ceilings, steel studs and related construction products in the greater Philadelphia metro area and was founded in 1994. SKBM services large and small projects in the commercial and multi-family residential end markets. With a 132,000 sq ft state-of-the-art facility, it has an operating history of two decades and its entire team will join the company, including its founder and president Steven F. Kempf.

GMS operates a national network of distribution centers across the United States. GMS' extensive product offering of wallboard, suspended ceilings systems, or ceilings, and complementary interior construction products is designed to provide a comprehensive one-stop-shop for our core customer, the interior contractor who installs these products in commercial and residential buildings.

US: ABC Supply and USG have entered into a agreement in which ABC Supply will acquire USG's building product distribution business, L&W Supply Corporation for US$670m. The transaction is subject to customary closing conditions, including regulatory approvals, and is expected to be completed before the end of 2016.

"As a world-class distributor of interior building materials, L&W reinforces ABC's leadership position in building materials distribution, and helps set the stage for our next phase of growth," said Keith Rozolis, ABC Supply's President and Chief Executive Officer.

Completion of the transaction will allow USG to reduce debt and achieve its target leverage ratio, accelerate high return investments in its Gypsum and Ceilings businesses through advanced manufacturing initiatives, and position the company to consider future capital returns to shareholders. The sale of L&W Supply is also expected to dampen USG's overall earnings cyclicality as well as provide opportunity for growth in the independent specialty dealer channel.

L&W Supply is one of the largest distributors of gypsum wallboard and suspended ceiling tiles in the US, serving its customers from 136 branches. ABC Supply is a wholesale distributor of roofing, siding, windows and gutter materials. The acquisition of L&W Supply will allow it to expand into the interior of the building through the sale of gypsum wallboard and suspended ceiling tiles and grid.

Belgium: Etex's sales revenue has fallen by 2.8% year-on-year to Euro1.48bn in the first half of 2016 from Euro1.52bn in the same period in 2015. However, on a like-for-like basis the group said that its revenue rose by 2.6% when exchange rates and scope were taken into account. Its profit fell by 12% to Euro55m from Euro63m.

The group reported that markets in Germany and France remain weak due to manufacturing capacity being downsized. In Latin American countries growth was realised with the exception of Brazil. The profitability of this growth was under pressure from exchange rates and increased competition.

Australia: Boral's profit after tax has risen by 8% year-on-year to US$204m in its financial year which ended on 30 June 2016 from US$190m in the previous year. Its sales revenue fell, by 2% to US$3.28bn, but revenue from continuing operations rose slightly. Revenue from continuing operations benefitted from stronger residential activity in Australia and the US, which offset the decline in resource-based and other major project activity. The company's earnings before interest and tax (EBIT) also rose due to operational cost improvements, lower fuel costs and some pricing gains.

"We have continued to improve our performance across our businesses in line with our strategy, managing our portfolio more efficiently and maintaining a strong balance sheet," said CEO and managing director Mike Kane. "The continued growth in Boral's earnings demonstrates the great work that has been done to improve our cost base, grow margins, and efficiently supply market demand, which continues to be strong in Australia and Asia, and is growing in the US."

The group's joint-venture with USG, USG Boral, saw its revenue rise by 10% to US$1.06bn from US$965m. This was attributed to growth in Sheetrock product
wallboard sales resulting in higher pricing, and growth in adjacent product (non-board) sales. Strong volume growth in Australia was offset by contraction in key Asian markets and price competition in South Korea. EBIT increased by 27% to US$136m from US$107m.