Gypsum industry news
France: Saint-Gobain has launched Grow & Impact, a new strategic plan to increase profitable growth. The plan consists of new annual financial targets for 2021-2025, including organic sales growth of 3 - 5%, an operating margin of 9 – 11%, a free cash flow conversion ratio above 50%, a return on capital employed of 12 - 15% and an annual dividend payout ratio representing 30-50% of recurring net income. The company also announced a Euro2bn share buyback programme for 2021 – 2025.
Saint-Gobain has forecast full-year energy and raw materials costs of Euro1.5bn, up by 36% from its previous estimate of Euro1.1bn. Euro1.1bn (73%) of the new estimate is forecast for the second half of 2021. The group said that it will need a positive price impact of around 6% over the full year and of 8% in the second half of 2021 in order to offset this. CEO Benoit Bazin said “The Group will build on the success of its new local organisation and its multinational culture driven by performance and by proximity to its customers, in order to benefit fully from strong growth on its underlying markets. By capitalising on innovation and the power of data to enrich our range of solutions, Grow & Impact will enable us to outperform our underlying markets and maximise our positive impact in numerous areas.” He added “Our vision is to become the worldwide leader in light and sustainable construction. In a world moving towards net-zero carbon, Saint-Gobain aims to provide a full range of solutions that address three major issues of our time: drastically reducing the 40% of CO2 emissions linked to construction, protecting natural resources and facing the challenge of rapid urbanisation in emerging countries.”
Boral reports substantial decline in demand
16 April 2020Australia: Boral has reported that, in most jurisdictions, its activities are currently considered to be within the critical infrastructure and construction sectors that are permitted and encouraged to continue as essential businesses. This includes Boral’s US Fly Ash business, which provides an essential service to the energy sector. In some areas however, particularly in North America and Asia, more stringent mandates and restrictions have resulted in temporary closures of several operations.
In addition, demand is declining in most markets and is expected to continue to decline, particularly in residential construction markets where the pipeline of work is substantially reducing in all geographies.
As a result, where it has sufficient inventory levels to supply customers, production curtailments are planned and are now taking place, including shift reductions and temporary plant closures. Boral says that these actions will help to conserve cash and minimise any unintended inventory build-up.
Boral is supporting employees impacted by temporary closures with access to paid leave, unpaid leave, flexible and remote working arrangements (where possible) and assistance with accessing relevant government support.
Saint-Gobain announces 120MW wind power deal
10 February 2020US: France-based Saint-Gobain has announced a 120MW wind power supply deal with Blooming Grove Wind Farm, the largest renewable energy contract in the gypsum wallboard producer’s history. The 12-year contract, which secures 120MW of the available 250MW of power for Saint-Gobain from the wind farm in Illinois, will reduce the company’s US carbon footprint by 21%, it says. “This makes North America a significant contributor in our global network towards helping meet Saint-Gobain’s sustainability goal of net-zero CO2 emissions by 2050,” said Saint-Gobain North America president and CEO Mark Rayfield.