Gypsum industry news

New Zealand: Members of the building sector report that a local shortage in gypsum wallboard has started to ease. Christchurch-based Co-operative Building Supplies chair Carl Taylor told Radio New Zealand News, that since Winstone Wallboards announced a number of corrective measures in June 2022, supply had improved a "fair bit" but it was not back to levels seen before the Covid-19 pandemic started. Rick Herd, the chief executive officer of building company Naylor Love, added that Winstone Wallboards had increased its production but that a reduction in market demand had also helped.

In late September 2022, Winstone Wallboards’ general manager David Thomas thanked his customers for their patience. He added that the company was getting closer to levelling up supply with demand for wallboard across the country. Parent company Fletcher Building Materials previously said that it expected the market to stabilise by October 2022. Winstone Wallboards’ GIB product range is the main brand of wallboard used in New Zealand. The company is reported to hold around a 95% share of the local market.

Belgium: Etex’s revenue rose by 16% year-on-year to Euro1.79bn in the first half of 2022 from Euro1.46bn in the same period in 2021 on a like-for-like basis. Its earnings before interest, taxation, depreciation and amortisation (EBITDA) grew by 20% to Euro319m from Euro266m.

Bernard Delvaux, the chief executive officer of Etex said, “In the first half of 2022, like many other industrial players, Etex had to cope with significant raw material and energy price inflation in the context of post-Covid-19 disruptions, volatility and the war between Russia and Ukraine. To face this situation, we had to implement a number of price increases. Our volumes and margins have been impacted, but these measures allowed us to achieve a positive evolution of both top line and bottom line.”

The company’s Building Performance division reported slightly lower gypsum wallboard sales volumes despite delivering a 16% increase in revenue to Euro1.23bn. The group also created an Insulation division in May 2022 following the completion of its acquisition of URSA.

China: BNBM’s operating revenue grew by 2.4% year-on-year to US$1.50bn in the first half of 2022 from US$1.46bn in the same period in 2021. Its net profit fell by 11% to US$237m from US$266m. Parent company CNBM reported that its sales volumes of gypsum wallboard fell by 5.8% to 1.09Bnm² from 1.16Bnm2. It said that continued coronavirus lockdowns and problems in the real estate market had affected market demand. It added that the price of raw materials and energy had also risen, leading to increased production costs and mounting product prices.

New Zealand: Fletcher Building Materials recorded consolidated sales of US$5.37bn during its 2022 financial year, up by 4.7% year-on-year from US$5.13bn in the previous year. Its net earnings also rose by 42%, to US$273m from US$193m.

The group's building materials division, which includes Winstone Wallboards, contributed US$1.02bn-worth (17%) of group sales. The business delivered 'strong' volumes, with pricing initiatives effectively offsetting cost inflation. The latter particularly impacted imports of raw materials. The business made capital expenditure investments of US$129m, of which US$98.4m went towards the construction of Winstone Wallboards' upcoming Tauriko gypsum wallboard plant in the Bay of Plenty region. The plant's commissioning in 2023 will increase the company's production capacity by 30% and reduce its CO₂ emissions and waste generation.

Fletcher Building Materials chief executive officer Ross Taylor said "The 2022 financial year has not been without its challenges. Global and national supply chain disruptions have continued into the third year of the Covid-19 pandemic. In New Zealand, surging plasterboard orders following the first quarter lockdown outstripped our ability to supply, despite our manufacturing facilities running at record levels. In recognition of our key role as a local manufacturer in keeping the market supplied, we carried out a range of measures to address the shortage including operating production lines 24/7, running down inventory, importing additional product, and establishing an emergency supply pool." Taylor added "The New Zealand Commerce Commission recently published its interim market study report into residential building supplies. The final report and recommendations will be published in December 2022 and in the meantime we will continue to work collaboratively with both the commission and the government."

US: Eagle Materials has recorded consolidated sales in its 2022 financial year of US$1.9bn, up by 15% year-on-year. The group’s adjusted earnings before interest, taxation, depreciation and amortisation (EBITDA) was US$657m, up by 15%. Full-year light materials sales totalled US$804m, up by 27%, with gypsum wallboard and paperboard operating earnings of US$274m, up by 42%. The group sold 269Mm2 of gypsum wallboard, up by 3% year-on-year.

President and CEO Michael Haack said "As we look back on another extraordinary year, I am extremely proud of our team's ability to deliver record operating and financial results despite multiple external challenges, including transportation disruptions, supply chain constraints and, of course, continuing to navigate the Covid-19 pandemic.” He added "As we begin our new fiscal year, Eagle is well-positioned, both financially and geographically, to capitalise on the underlying demand fundamentals that are expected to support steady and sustainable construction activity growth over the near and long term. We expect that infrastructure investment should increase in the latter part of our fiscal year, as federal funding from the recently enacted Infrastructure Investment and Jobs Act begins in earnest. And, despite recent interest rate increases, housing demand remains strong across our geographies, outpacing the supply of homes. Nonresidential construction activity is also picking up."

New Zealand: Revenue from Fletcher Building’s Building Products division rose by 9% year-on-year to US$514m in the first half to 31 December 2021 from US$471m in the same period in 2020. Earnings before interest and taxation (EBIT) fell by 6% to US$68.6m from US$64.6m. The building materials producer, distributor and construction company blamed the declining earnings on a coronavirus-related lockdown in the summer of 2021, although it noted improved performance in the following quarter. Overall group revenue and earnings grew in the reporting period.

“With improved operational performance and cost disciplines now embedded across the business, we were able to deliver a strong performance. This was despite the first quarter being heavily impacted by the up to five week-long Covid-19 stringent lockdown in New Zealand and local lockdowns in Australia which impacted EBIT,” said Fletcher Building’s chief executive officer Ross Taylor.

Fletcher Building’s subsidiary Winstone Wallboards is currently building a new 10Mm²/yr gypsum wallboard plant at Tauriko near Auckland. Commissioning is planned for the group’s 2023 financial year that starts in June 2023. Once completed the company says it will have a total national wallboard production capacity of 40Mm²/yr.

New Zealand: Winstone Wallboards has decided to move to an allocation model of supplying its GIB plasterboard products from July 2022 due to mounting lead times in manufacture. It said it would, effective immediately, not be accepting or processing new GIB plasterboard orders for July 2022 deliveries onwards. Instead it plans to assess the situation in the coming months and it anticipates moving to a process where customers order plasterboard products one month in advance.

The gypsum wallboard producer blamed the situation on significant disruption across the building industry caused by local-coronavirus-related lockdowns in August and September 2021. It said that this caused a backlog of orders. Subsequent record manufacturing output and imports were insufficient to alleviate the situation.

Japan: Chiyoda Ute’s revenue remained stable at US$165m in the first nine months of its financial year to 31 December 2021. Its net profit grew by 53% year-on-year to US$5.37m from US$3.52m in the same period in 2020. The gypsum wallboard producer reported that domestic house building had grown from March to December 2021 in tandem with a relaxation in coronavirus health measures from September 2021. It said that national gypsum wallboard shipping volumes grew by 2.4% to 344Mm² in the nine months to 31 December 2021. It added that due to the capital and business alliance it started with Knauf Group in January 2020 it viewed its future prospects as ‘competitive.’ In late 2019 the Germany-based construction materials company increased its shareholding in Chiyoda Ute to 45% from 26%.

Switzerland: Sika’s sales grew by 17.3% year-on-year to Euro8.96bn in 2021 despite the Covid-19 pandemic and procurement delays for raw materials. Sales increased in all regions with notable growth reported in the Middle East, Eastern Europe, the UK, the US, Latin America and China. The group said that in the Americas a strategic focus on business activities in metropolitan areas, major infrastructure projects and cross-selling helped it. Sika is also currently in the process of buying MBCC Group, a construction chemicals suppler previously known as BASF Construction Chemicals, for Euro2.8bn.

"2021 was expected to be a challenging year and it proved to be a very successful one for Sika. We are benefiting from a number of growth platforms and are in an ideal position to achieve long-term success,” said chief executive officer Thomas Hasler. “We have solutions in place for all the development stages of construction markets, and government supported investment programs running into the billions will provide further impetus for our business.

US: GMS’s consolidates sales were US$2.19bn in the first half of 2021, up by 36% year-on-year from US$1.62bn in the first half of 2020. Its gypsum wallboard sales constituted 37% of its total sales at US$805m, up by 22% from US$659m. The company’s earnings before interest, taxation, depreciation and amortisation (EBITDA) rose by 70% to US$265m from US$156m, while its gross profit rose by 35% to US$708m from US$526m.

President and chief executive officer John Turner said “Net sales again topped US$1bn, with record levels of net income and adjusted EBITDA. Supply chain dynamics have led to all-time high levels of product inflation, which have been the principal driver of both sales growth and incremental profitability. He added “That said, our relentless focus on customer service and the solid execution of our strategic priorities have enabled us to capture the benefits of both this heightened product inflation across our portfolio as well as continued strength in the residential market.”

Turner concluded “While commercial activity remains well below pre-Covid levels, we were pleased to see certain commercial projects that were previously on hold receive approvals to move forward. With other positive signs also emerging, we believe that we are very well positioned as we head into the next calendar year to benefit from an eventual commercial construction recovery.”