Sri Lanka cement market to pick up in second half of 2013

Tuesday, 23 July 2013 00:36 -     - {{hitsCtrl.values.hits}}

Sri Lanka’s cement market is likely to pick up in the second half of the year after a slump experienced in the first six months of 2013; a result carried forth from the latter half of 2012. Anticipating similar performance data as the previous year, minus one or two per cent, the industry is gearing for higher volumes within the next few months, Holcim Lanka CEO Philippe Richart said last week. Speaking at the launch of the 2012 Sustainability Review of Holcim Lanka, Richart noted that the dip in the first half was some 7% to 9% which is expected to increase in the coming months. “Taking in to account the first six months, we are slightly below numbers compared to last year as the market dropped during the said period. On an annual basis, the first six months of 2012 saw very high volumes and the second half was low. We believe 2013 is the opposite. It had a slow start and we expect it to pick up within the second half.” In 2012 the overall market recorded an increase of 13% over 2011 with the Government’s focus on economic growth and infrastructure development. Accordingly, Holcim Lanka’s sales volumes improved by more than 6% in 2012 over 2011. Annually the company sells some 1.6 million tonnes of cement, largest amount of cement sold locally by a company. Richart added: “Market growth is not as strong as we expected; it is even slowing down a bit, but despite this, we did well in the first six months.” The company has been able to achieve its budgeted targets for the first half of the year while profitability has also improved compared to last year’s degradation. Listing out reasons for the stability of the company which helped manage goals despite external conditions, Richart mentioned the strong pricing management in place within Holcim and strong engagement between distributors and dealers through loyalty programs which is now deployed in most districts of the country and will have an island-wide coverage by end of the year, as two of the key success factors. In the second part of the year Holcim Lanka will work strongly focus on the areas of brand and cooperate image development. “Right now we are working on developing some initiatives which includes an advertising campaign as well as on-the-field projects,” Richart said. Supporting the company’s performance is its well-known manufacturing excellence. Sri Lanka is an expensive country to produce cement in, as it is an island and most raw materials have to be imported, he asserted. For years Holcim has been able to demonstrate its ability to reduce costs in a sustainable manner through various initiatives such as the famed ‘Geocycle’ which provides professional waste management solutions to over 300 customers in Sri Lanka across various scales of industries and its ‘Beyond 1050 Project’. “Through such initiatives we have shown that while we are a heavy industry company, we can also be a green industry.”