Carpatcement Holding, the domestic unit of Germany's HeidelbergCement group, is set to invest 55m euros to start and modernise the second production line of Bicaz plant, currently under conservation, say the company's representatives.
The investment is part of a broader process to double production capacities, which the Germans will finalise in 2011 in the wake of total investments worth around 100m euros, as HeidelbergCement is unable to meet market demand.
"The first stage of the investment project meant to double production capacities entails starting and modernising the second production line of Bicaz, now under conservation. The project has already been approved and investments will be finalised in mid-2009," stated Mihai Rohan, general manager of Carpatcement Holding. In the wake of investments, the company's production capacity will rise by around one million tonnes per year.
The Germans have invested around 56m euros this year to modernise and expand the three cement plants, reaching total investments worth around 350m euros since they entered the Romanian market in 1998.
"We expect overall cement sales to rise by around 15% from 2006," says Rohan. However, sales growth will be below market growth, which is due to hit 25% this year, amid limited production capacities and the deterioration of weather conditions toward the end of the year.
Carpatcement Holding in the first 9 months of this year generated 23% sales growth in terms of volume compared with the same period of last year. By comparison, the company in H1 saw its cement sales rise by 40% against the similar period of last year, owing to beginning-of-the-year favourable weather conditions and constructions boom.
The company's representatives at that time stated, though, they had been unable to meet market demand amid the insufficient production capacities, a situation the company went through in Q3 as well.
HeidelbergCement owns 3 cement plants in Romania, in Bicaz, Fieni and Deva, which were acquired in 1998-2002 period. Subsequently, the Germans closed one of the lines they held at the plant of Deva and a furnace at Bicaz plant.
But, amid the strong increase in cement consumption in recent years, the producer's estimates were overshot and the company in 2006 kept the cement plant of Fieni open during New Year's Eve, too.
HeidelbergCement in 2006 hit turnover worth some 278m euros in Romania, up 39%, with the figure including the results of the 3 units of the group: cement, concrete and aggregates.
HeidelbergCement shares the domestic market with Switzerland's Holcim and France's Lafarge, each accounting for around one third of the market, which was estimated to be worth approximately 500m euros last year.
HeidelbergCement
Is set to invest 55m euros to start and modernise the second production line of Bicaz plant, currently under conservation
The investment is part of a broader process to double production capacities, which the Germans will finalise in 2011 in the wake of total investments worth around 100m euros
In 2006 hit turnover worth some 278m euros in Romania, up 39%, with the figure including the results of the 3 units of the group: cement, concrete and aggregates
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