Lafarge Malayan Cement expects robust 2H12 demand

At Lafarge Malayan Cement’s analysts 2Q12 briefing held on Monday, the company said it expects the robust cement demand seen in the first half to continue in the second half.

The company expects the healthy demand scenario to be driven by the implementation of large infrastructure projects such as the new LCCT terminal and coal power plants.

Group utilisation rates remain high at 85-90 per cent, enabling management to cut back on cement exports in favour of serving the domestic market.  Higher Malaysian sales helped Lafarge’s 1H core earnings per share rise 18 per cent YoY.

On 1 August 2012, Lafarge raised its cement price list. However, management warned that the launch of Hume Industries 1.5Mta clinker plant by end-2012 or early 2013 could cause some price instability going forward.

The company also said at the investor briefing that it will be debt-free after September this year, CIMB Research reported. Lafarge Malayan Cement will now re-examine its capital structure and draw up a plan by November.