Gypsum industry news

Saudi Arabia: National Gypsum’s three-month profit in the first quarter of 2021 declined by 23% year-on-year to US$7.20m from US$9.33m in the first quarter of 2020. During the quarter it recorded a net profit of US$3.78m, down by 20% from US$4.72m.

US: Eagle Materials recorded consolidated net sales of US$1.62bn in its 2021 financial year, up by 16% year-on-year from US$1.40bn. Its net earnings quadrupled to US$339m from US$70.9m. Its gypsum wallboard sales volumes increased by 6% to 265Mm² from 265Mm². The building materials producer increased its wallboard prices during the second half of the year due to improved demand outlook for single-family construction activity in the US and increasing demand for our products.

President and chief executive officer Michael Haack said, “Across all measures, fiscal 2021 was extraordinary for Eagle as we met and overcame challenges that were inconceivable just a year earlier. The resilience of our business model, our financial discipline and our team’s operational and strategic execution allowed us to deliver record financial results, integrate the largest acquisition in the company’s history and further streamline our business portfolio by divesting several non-core businesses, all while achieving industry leading safety performance. Our strong operating cash flow enabled us to reduce leverage to under 1.5 times net debt-to-earnings before interest taxation depreciation and amortisation (EBITDA), providing us with significant liquidity and increased financial flexibility.” He continued “As we begin our new fiscal year, Eagle is well-positioned, both geographically and financially, with ample raw material reserves 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 remain confident in Eagle’s prospects for continued growth and sustainable value creation for all shareholders.”

Australia: Boral has rejected a proposed US$5/share takeover bid by Seven Group Holdings. The building materials producer received the bid on 10 May 2021 and then rejected it the following day, according to the Financial Review newspaper. Seven Group Holdings started buying shares in Boral in March 2020 and reached a 23% stake in the company by April 2021. Boral has continued a share buy-back programme it commenced in April 2021 as part of its response to the takeover attempt. Sources quoted by the newspaper also expect Boral to work with investment bank Jarden Australia in retaliation to Seven Group Holdings’ actions.

US: GMS has agreed to acquire gypsum wallboard retailer Westside Building Material for US$135m. The trader operates nine sites across California and Nevada. The producer says that the company’s current management will continue to lead the business.

President and chief executive officer John Turner said, “The acquisition of Westside reflects the continued execution of our growth strategy and brings together two leading organisations with shared cultures and entrepreneurial values. Westside’s differentiated platform provides a unique opportunity for GMS to expand our reach and capture significant growth opportunities in strategically important West Coast markets.” He added “We believe that through this combination we will create new opportunities to deliver world-class service to our customers and value to our stakeholders for years to come.”

New Zealand: The New Zealand Ministry of Finance plans to launch a commission to investigate high building materials prices. The New Zealand Herald newspaper has reported that finance minister Grant Robertson said that New Zealanders pay too much for building materials. Robertson indicated that any probe would look into gypsum wallboard among other building materials. Average national building materials prices are 20 – 30% higher in New Zealand than in Australia.