Gypsum industry news

US: United States Gypsum Corporation subsidiary L&W Supply has announced the closure of eight of its stores, citing a continued weak US housing market. It also announced that it was to wrap up its Nevada-based custom door and frames business by the end of the current quarter. The closure is expected to cost the unit somewhere in the region of USD13-15m in total.

Asia: French cement group Lafarge has announced that it has completed the signing of a deal to sell to its Australian peer Boral its stake in their 50/50 gypsum-producing joint venture Lafarge Boral Gypsum Asia (LBGA) for USD619.4m.Thanks to the sale, Lafarge will exceed its target to divest assets worth USD1.08bn in 2011.

The transaction is part of Lafarge's plan to reduce debt and is due to be finalised by the end of 2011. The plan has already seen assets in South America and Europe transferred to Etex and Australian operations sold to Knauf.

LBGA has 2100 employees spread across 20 production sites and registered sales of USD260.8m in 2010. Its earnings before interest, tax, depreciation and amortisation (EBITDA) were USD44.7m in 2010. This latest deal means that Lafarge now only has gypsum assets in North America.

US: Waste-to-energy projects developer Recycled Energy Development (RED) and building products maker National Gypsum Co (NGC) have jointly announced the development of a combined heat and power (CHP) project at NGC's Burlington 32MM²/yr facility in the state of New Jersey.

The project has received a USD1.36m grant from the state through its Clean Energy Solutions ARRA CHP grant programme. The CHP plant will reportedly have an electricity generation capacity of 3.4MW, representing around 210,000MMBtu of thermal energy, which will result in an overall efficiency of greater than 90%.

"The NGC project will increase industrial productivity, generate clean power and reduce CO₂ emissions," said Sean Casten, RED's president and CEO. "We appreciate the State's support and look forward to investing in New Jersey."

"CHP offers a win-win for manufacturers," said John Corsi, VP of Manufacturing Operations and Engineering of NGC. "This facility allows NGC to further strengthen our competitiveness as well as improve our environmental stewardship."

US: Eagle Materials, Inc has released its fiscal results for the first quarter (ending 30 June 2011) of the 2012 financial year. Its revenues were USD119.8m and its net earnings were USD3.1m, with earnings per diluted share of USD0.07.

In a statement Eagle said that demand for building materials and construction products remained weak and that it would continue to streamline its operations in response to these lower levels of construction activity. Revenues decreased compared to 2010, primarily due to lower sales volumes across all of Eagle's businesses sections.

Eagle's 'Gypsum Wallboard and Paperboard' section first fiscal quarter operating earnings of USD4.3m were down by 53% compared to the same quarter of 2010. The section's revenues for the first quarter totaled USD70.3m, a 9% decrease from the same quarter of 2010.

The revenue decline reflects lower sales volumes and lower average net sales prices. The average gypsum wallboard net sales price the quarter was USD90.03/MSF, 8% less than the 2010 quarter. Gypsum wallboard sales volumes for the quarter were 412MMSF, representing a 9% decline compared to the same quarter of 2010.

US: USG Corporation (USG) has reported second quarter 2011 net sales of USD761m, an operating loss of USD21m and a net loss of USD70m. For comparison in the second quarter of 2010, the corporation's operating loss was USD25m and its net loss was USD74m.

US Gypsum wallboard shipments totaled 986MMSF, down on the second quarter of 2010, which saw 1070MMSF shipped. The average selling price was also down, from USD114.17/MSF on average to USD111.55/MSF.

"We are continuing to pursue our near-term and long-term strategic priorities during the protracted recession in our domestic markets," said James Metcalf, President and CEO of USG. "By strengthening our core businesses, diversifying the sources of our earnings and aggressively leveraging our innovation leadership to differentiate USG's products from the competition, we are confident that we can successfully navigate this recession and capitalise on a recovery."

The corporation's adjusted operating loss was USD19m in the second quarter of 2011, which compares to an adjusted operating loss of USD18m in the second quarter of 2010. The adjusted operating loss for the second quarter of 2011 excludes USD2m of restructuring and long-lived asset impairment charges, while the adjusted operating loss for the second quarter of 2010 excluded USD7m.