Gypsum industry news

Qatar: SIG plc, a distributor of specialist building products in Europe, has acquired a majority shareholding in Drywall Qatar, an independent distributor and specialist installer of interior finishing materials in Qatar.

"We are excited to partner with SIG, a leading European player in the construction material procurement sector. SIG's financial strength and wide product portfolio of 30,000 products coupled to the key relationships with over 6000 suppliers will allow Drywall Qatar to provide an even deeper product supply chain and enhanced product offering to both new and existing clients," said Drywall Qatar's director, George Xydas.

Pakistan: DFB Gypsum Industries has announced that it is building a new gypsum facility in Hattar, Khyber Pakhtunkhwa. The new plant is expected to start production in the middle of 2016. It will have a 100,000t/yr plaster line and a 6Mm²/yr wallboard line.

Vietnam: Deputy prime minister Hoang Trung Hai has directed the implementation of solutions to treat waste at thermal power plants for energy conservation and environmental protection.

Trung Hai urged the concerned parties to more effectively implement Government Decision 1696/QD-TTg on measures to treat gypsum, ash and cinder from thermal power, chemical or fertiliser plants for the production of building materials. Special focus should be paid to the Vinh Tan in Binh Thuan, An Khanh in Thai Nguyen, Song Hau in Mekong Delta Hau Giang and Vung Ang in Ha Tinh thermal power plants, where waste treatment is a pressing issue.

He asked the Ministry of Industry and Trade and the Ministry of Construction to coordinate with localities to disseminate effective waste treatment models while supplementing and completing criteria on the quality of ash and cinder for recycling in cement and construction material production.

Vietnam is home to 19 operating thermal power plants with a total capacity of 14,480MW, which discharge about 15Mt/yr of ash and cinder. After 2020, the country is expected to have 43 thermal power plants with a combined capacity of 39,020MW, discharging over 30Mt/yr of ash and cinder.

US: H.I.G. Capital, a global private equity investment firm, has announced that its portfolio company ACG Materials, a vertically integrated producer and processor of high-quality minerals and aggregates including gypsum, limestone, sand, gravel and downstream food, pharmaceutical and plaster products, has acquired Art Wilson Company (AWC). AWC mines, processes and markets anhydrite, gypsum and limestone products used in agricultural, industrial, and commercial applications across Nevada, California, Washington, Oregon, and Idaho. It owns and operates a quarry and downstream production facility in Carson City, Nevada with additional owned reserves under development nearby.

"We are excited about the continued expansion of our operations into the Western US," said Paul Harrington, CEO of ACG Materials. "Art Wilson Company not only allows us to acquire the market leading supplier of agricultural gypsum serving California's Central Valley and surrounding areas, but also broadens our customer footprint, product portfolio and end market diversification. AWC has had a long and successful history since its founding by Art Wilson in the 1950s and we look forward to serving as great stewards of the business going forward."

AWC is the fifth add-on acquisition that ACG has completed since H.I.G. acquired ACG at the end of 2012 and marks the second acquisition in 2015. In February 2015, ACG acquired JA Jack & Sons, a Seattle, Washington-based miner and processor of limestone products.

Canada: Continental Building Products has reported that its net sales, operating income and wallboard sales all grew in the second quarter of 2015.

"We produced another quarter of strong cash flow as a result of our disciplined operations, efficient cost structure and sharp focus on execution as we continue to grow our business," said Jay Bachmann, Continental Building Products' CEO. "During the quarter, each of our regions experienced stronger construction activity, enabling us to deliver solid growth in our wallboard shipments. We actively managed our costs to achieve significant operating leverage on higher sales and repurchased approximately 2% of our outstanding shares for US$20m while also reducing our debt leverage. We believe that we continue to be well positioned to capitalise on improving construction activity in our markets to enhance our profitability and deploy our capital into additional value-enhancing opportunities."

Net sales for the second quarter of 2015 grew by 7.9% to US$111m. The growth was primarily driven by 8.1% higher wallboard volumes to 567Mft2. The average mill net price grew by 0.7% year-on-year. At constant currency, the average mill net price increased by 1.5%. For US shipments, the average mill net price increased 1.4% year-on-year. Gross profit grew by 41.1% to US$29.5m and gross margin grew to 26.6% from 20.3% in the same quarter of 2014, primarily as a result of operating leverage achieved through higher wallboard volume and favourable energy costs. Operating income was US$4.3m compared to US$12.8m in the same period of 2014. Adjusted net income grew to US$10.2m from US$4.7m in 2014. Adjusted earnings before interest, taxes, depreciation and amortisation (EBITDA) increased by 24.4% to US$33.3m.

In the second quarter of 2015, Continental Building Products repurchased 913,200 shares of common stock at an aggregate purchase price of US$20m from an affiliate of Lone Star in a private transaction in connection with the secondary public offering in May 2015. It also used cash flow from operations for the voluntary repayment of US$10m of debt. The next principal payment on its debt not required until August 2020.