Gypsum industry news

Australia: 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.

Australia: Boral has updated the market on its transaction with Knauf in relation to its USG Boral joint venture. On 19 March 2020, Boral announced that its view was that the Australian Competition and Consumer Commission (ACCC) was unlikely to approve the call option in relation to the Australian and New Zealand business. In further discussions between Boral and Knauf, it has now become clear that obtaining the necessary regulatory approvals required to allow the transaction to be implemented as signed in August 2019 is not achievable by the 30 June 2020 deadline. Other conditions to the transaction also remain outstanding.

As a result, Boral and Knauf will consider a range of potential options, with Boral’s objective being to target a cash neutral transaction rather than a transaction with a significant funding requirement for Boral. Discussions are at a preliminary stage and any revised transaction remains subject to agreement between Boral and Knauf, and ultimately will also require the approval of regulators including the ACCC and New Zealand Commerce Commission (NZCC). Given this, the company’s pre-existing US$400m acquisition bridge facility, put in place for the purpose of completing the transaction with Knauf, was allowed to lapse.

US: Eagle Materials Inc. has announced that Mary Ricciardello has been appointed to the company’s Board of Directors. Ricciardello also serves as a director on the boards of Devon Energy and Noble Corporation, serving as the Audit Committee Chairperson on both boards. Her previous board service includes seven years on the board of US Concrete. Ricciardello enjoyed a distinguished career at Reliant Energy, where she served in key roles, including that of Chief Accounting Officer.

Mike Nicolais, Eagle’s Board chair, commented, “We are extremely pleased to have Mary join our Board. Mary is a proven leader and will be a great complement to the strong leaders on our board today. The addition of Mary to the board is also timely in that it provides additional flexibility in light of prospective Board needs as we plan for the separation of Eagle Materials into two publicly traded companies.”

Ireland: France-based Saint-Gobain subsidiary Gyproc has applied to the Environmental Protection Agency (EPA) to have its sulphate discharge licence for its Drummond, County Monaghan, mine increased by 530% to 1250mg/l from 200mg/l. The Irish Independent newspaper has reported that the higher level ‘would not occur year-round,’ according to the company, but ‘only at certain times.’ The EPA is ‘awaiting additional information from the applicant in order to make a decision.’

Belgium: Etex’s net profit was Euro176m in 2019, a rise of 26% year-on-year from Euro140m in 2019. Sales crept up by 1.5% to Euro2.94bn from Euro2.90bn. Etex chief executive officer (CEO) Paul Van Oyen called 2019 an ‘outstanding year’ in which Etex ‘significantly increased its plasterboard volumes, driven by a strong market in several countries’ and reduced its debt by 43% to Euro331m, its lowest level since 2011. This was thanks to the sale of its UK and Portuguese tile roofing businesses.

Van Oyen’s announcement was overshadowed by the current circumstances surrounding the COVID-19 outbreak. “Today, my thoughts mainly go to all of our colleagues and their families worldwide, especially the ones who have been infected with the coronavirus,” he said. “Etex will not change its identity as a result of this crisis: our priority is and will always be the health and safety of our colleagues and stakeholders worldwide. We are determined keeping our business running, and to continue to Inspire ways of living.” Van Oyen also paid his respects to those within the company who have died of coronavirus.