Gypsum industry news

Switzerland: Sika’s 2020 full-year sales were Euro7.29m, up by 3% year-on-year when adjusted for currency variations. Sales grew in the Europe, Middle East and Africa region by 4.4%, in the Americas regions by 1% and in the Asia/Pacific region by 13%. The group recorded market share gains in all regions. During the year it acquired Romania-based Adeplast, US-based CIDRA Concrete Systems and Egypt-based Modern Waterproofing Group. The acquisitions span concrete, mortars and insulation production. The company established new plants in China and Colombia. It upgraded plants in France, Switzerland and the UAE.

Chief executive officer (CEO) Paul Schuler said "The 2020 fiscal year was overshadowed by the global coronavirus pandemic, which had a number of serious repercussions for the construction and automotive sectors. Thanks to the strong motivation of our employees and their pronounced customer focus, Sika managed to perform successfully in this highly challenging market environment and achieve above-average results. We remain very well positioned in what is still a difficult environment – thanks to our innovative products and solutions, as well as to our employees, who continue to deliver their utmost even in times such as these. On behalf of group management, I would like to thank our global workforce of 25,000 people for the tremendous dedication they have shown and for the unique way they identify with our company."

The group confirmed its 2023 targets, saying “The company remains aligned for long-term success and profitable growth. With its focus on the six strategic pillars – market penetration, innovation, operational efficiency, acquisitions, strong corporate values, and sustainability – Sika is seeking to grow by 6 – 8% a year in local currencies up to 2023. From 2021, the company is aiming for a higher earnings before interest and taxation (EBIT) margin of 15 – 18%. Projects in the areas of operations, logistics, procurement, and product formulation should result in an annual improvement in operating costs equivalent to 0.5% of sales.”

US: Eagle Materials recorded sales of US$875m in the six months between 1 April 2020 and 30 September 2020, the first half of its 2020 financial year, up by 16% year-on-year from US$756m in the first half of the 2019 financial year. Gypsum wallboard sales were 132Mm², up by 6% from 125Mm², while net earnings rose by 70% to US$192m from US$113m.

President and chief executive officer (CEO) Michael Haack said, “We are pleased to have delivered another quarter of record revenue and net earnings growth while further strengthening our balance sheet. Our end markets remain resilient as Covid-19-related uncertainty persists.” He added that, “the housing market continued its strong rebound” and that wallboard shipments rose by 6% in the second quarter. Good operating cash flow and a tax refund helped the company increase its earnings ‘significantly’ in the reporting period.

India: France-based Saint-Gobain has opened a 600-bed coronavirus hospital in a converted office building in Surat, Gujarat. The total building time for the project was just 17 days, which the company said was ‘due to the choice of materials, namely gypsum wallboard over bricks and mortar.’ The Hindu BusinessLine newspaper has reported that the company used 4830m² of gypsum wallboard to build partition walls throughout the eight-storey building, in accordance with World Health Organisation (WHO) guidelines.

Oman: Oman’s gypsum exports fell by 4% year-on-year to 4.99Mt in the first seven months of 2020 from 5.20Mt in the same period in 2019. However, data from Zawawi Minerals shows that exports picked up by 28.7% year-on-year to 1.14Mt in July 2020 from 0.89Mt in July 2019. The government allowed industry to reopen in late June 2020 following a coronavirus-related lockdown.

France: Saint-Gobain’s says its sales for June 2020 rose by 3.7% on a like-for-like basis as markets recovered from the effects of the coronavirus pandemic. Its sales fell by 12.3% year-on-year on a like-for-like basis to Euro17.8bn in the first half of 2020 from Euro21.7bn in the same period in 2019. Its earnings before interest, taxation, depreciation and amortisation (EBITDA) decreased by 32.4% to Euro1.64bn from Euro2.42bn.

“In a macroeconomic and health environment which remains affected by uncertainties, our earnings growth in June and outlook for the third quarter suggest that our operating income for second-half 2020 will improve significantly on first-half 2020,” said Pierre-André de Chalendar, chairman and chief executive officer (CEO) of Saint-Gobain. He added that the group’s portfolio of products, including those in energy-efficiency and renovation markets, positioned it to benefit from national and European stimulus plans supporting energy saving initiatives.

The group noted a 19.2% year-on-year sales decrease in the second quarter of 2020 due to the coronavirus pandemic, with very different situations between countries and markets. Most of its business segments reported growth in June 2020 with the exception of Asia-Pacific, where the Indian market held the division back. Gypsum sales helped deliver ‘robust growth’ in the US and Canada in June 2020. Strong growth in gypsum was reported in Brazil for the first half of 2020. Chinese sales in gypsum benefitted in the second quarter of 2020 from a new plaster plant, which originally opened in 2019, reaching full production capacity. The group’s High Performance Solutions division reported positive trends from its external thermal insulation solutions (ETICS) products in the second quarter of 2020.

US: Eagle Materials’ sales from its Light Materials division rose slightly to US$153m in the first quarter of its financial year to 30 June 2020. Gypsum wallboard sales revenue growth offset declines in paperboard sales. However, earnings fell by 8% to US$44m. Gypsum wallboard sales grew by 7% to 65Mm2. Overall, the group’s revenue and earnings rose.

“While we are very pleased with our first-quarter performance, we recognise a high level of uncertainty persists in our markets and the overall economy: despite the decline in jobless claims from the March peak, total unemployment remains historically high; state and local governments face ongoing revenue pressure, which could have the potential to constrain infrastructure budgets; and, in some geographic areas important to our business, Covid-19 case numbers continue to escalate,” said Michael Haack, president and chief executive officer (CEO).
The group announced plans in May 2019 to split its Heavy Materials and Light Materials divisions into two independent businesses. However, it says the timing remains ‘uncertain.’

Switzerland: Sika recorded a net profit of Euro257m in the first half of 2020, down by 17% year-on-year from Euro308m in the first half of 2019. Net sales were Euro3.37bn, down by 3.2% from Euro3.48bn. Sika attributed the sales decline to negative currency effects. Decreased sales volumes in March 2020 through to May 2020 as a result of the coronavirus outbreak hampered profitability, according to the company. It said that the end of lockdowns in markets across the globe brought a return to organic growth in June 2020.

Canada: Red Moon Resources says it has restarted production for the season at its Ace mine in western Newfoundland. Overall production at the site in 2020 is expected to be less than in 2019 due to disruption to both operations and markets caused by coronavirus. The situation is expected to stabalise in 2021. The company mined 0.16Mt of gypsum and anhydrite from the site in 2019.

UK: Matt Pullen, the managing director of British Gypsum, says that the company intends to loosen restrictions on wallboard sales in August 2020. “Whilst we continue to see high levels of demand, we have sufficient capacity to supply your wallboard requirements without formal supply restrictions,” said Pullen. He added that the company’s plaster manufacturing plants continue to, ‘operate consistently at maximum capability.’

Gypsum plaster-based products have been in short supply in the UK since the local coronavirus-related lockdown started in March 2020. The subsidiary of Saint-Gobain suspended operations in April 2020 and Knauf stopped production at its wallboard plants in the UK at the end of March 2020. British Gypsum reported in late May 2020 that its wallboard capacity was at ‘approximately’ 80% of pre-coronavirus pandemic levels following the scaling up of its ‘Covid-19 safe’ operations and distribution plan. Etex’s Siniat said it was ending product allocation controls in early July 2020.

US: GMS’ net sales from its wallboard products rose by 5% year-on-year to US$1.33bn in the financial year to 30 April 2020 from US$1.27bn in the same period in 2019. Its overall sales grew by 4% to US$3.24bn from US$3.12bn. Adjusted earnings before interest, taxation, depreciation and amortisation (EBITDA) increased slightly to US$300m. Wallboard sales were stable in the fourth quarter of its reporting year as coronavrius-related market declines in late March and April 2020 caused total company sales to decrease in the period.

“Through mid-March 2020 we experienced favourable end-market trends and generated robust volume growth. Even as disruptions from COVID-19 began to escalate in the second half of March 2020, construction and building products distribution were deemed essential in the majority of our markets, which enabled us to keep most of our locations open. However, demand weakened significantly in late March 2020 and in April 2020 as customers delayed orders and building projects were paused due to mandated shutdowns in certain markets or as they focused on responding to the effects of COVID-19 on their businesses,” said John C Turner, Jr, president and chief executive officer of GMS.