Catalan company ‘Ciments Molins’ to invest 191 million euros this year in foreign plants for the first time
Tunisia will benefit from the greatest investment with 73 million euros for the Kairouan factory. Besides, Ciments Molins is aiming to penetrate into the Chinese market with “a small two million euro investment” in prefabricated products, as a start. 87% of the investments will be channeled abroad, specifically in Tunisia, México, Argentina, Uruguay, Bangladesh, and China.
Barcelona (CNA).- The Catalan company Ciments Molins is aiming to penetrate into the Chinese market with a two million euro investment in prefabricated products. The Board of Directors has approved a 191 million euro investment plan in total, a 9% drop in investments compared to 2010. 87% of the investments will be channeled abroad, specifically in México, Argentina, Uruguay, Tunisia and Bangladesh. This will allow the company to survive the Spanish market crisis situation which chief executive Joan Molins considers \u201Chopeless\u201D due to a 17% fall in consumption and a 21,8% drop in contracting new business in 2010.
Faced with a Spanish market far from recovery, Molins added that internationalization is the only way for Ciments Molins to be viable. In this sense, Molins revealed his intention to get into the China market with a small \u201Ctwo million euro investment\u201D that will allow the company to observe the Chinese market\u2019s behaviour. This investment will be done through \u201CPrefabricats I Contratas\u201D (Precon) a company based in Shandong, China.
The investment plan
87% of the 191 million euro investment will be assigned to the plants abroad. In Spain only 25 million euros will be invested, basically in the Sant Viçenç dels Horts (Barcelona Metropolitan Area) plant. Some alterations will be made: an adaptation of the fuel line in order to permit the use of rejected material from other sector\u2019s business.
The rest of the investment will be distributed overseas. Tunisia will benefit from the greatest investment with 73 million euros for the Kairouan factory. Ciments Molins already has 65% of its stock here and works through a society called \u201CSotacib\u201D.
As for the economic crisis, although there are many transversal aspects, Joan Molins highlighted two questions that do modify their position: a lack of funding and the question of business ethics.
A show of understanding towards Plaça Catalunya\u2019s \u201Cindignats\u201D
Joan Molins said he understood why hundreds of disaffected people are camping out in Barcelona town centre. According to the chief executive, \u201Cthere has been a lack of sensitivity in the way some aspects of the crisis have been treated\u201D. As for the immediate future Molins is pessimistic. He considers there will be no recovery neither this year nor the next and did not want to speculate about 2013.
On Ciments Molins
The Chief executive clarified that despite the crisis, Ciments Molins hasn\u2019t fired any worker this year and explained that staff reductions have been done voluntarily. On the whole, only 46 people out of a total of 4573 staff worldwide have left the company.
The company has a turnover of 808 million euros, a 21,8% rise compared to 2009. According to Ebitda (Earnings Before Interest, Taxes, Depreciation and Amortization), Ciments Molins has earned 166 million euros exceeding by 2,4% the corresponding figure for 2009. The Spanish market decreased, contributing just 35% to total figures as opposed to the 49% figure for 2009.
Sales forecast for this year
Sales in March have fallen by 6%, which means a 88,8% fall in accounts according to Ebitda on Spanish contribution. However, according to the sales forecast for 2011, and with the helping hand of the plants abroad, the Ebitda tax will be consolidated positively (10%) in order to improve over the following years, said Molins.