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Holcim New Zealand gains approval for new import terminals

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World Cement,

On 24 June, Holcim New Zealand Limited (HNZL) announced that it has all the final approvals required for construction to begin on its two new import cement terminals. This is in line with the company’s new business strategy of importing and distributing bulk cement for supply to the New Zealand market and moving out of manufacturing.

Two import terminals

The company now has all the final approvals to go ahead with its investment of more than NZ$100 million to build two 30 000 t import terminals, one in Timaru and one in Auckland (Waitemata).

Managing Director, Jeremy Smith has confirmed that construction will start at the Port of Timaru during August 2014 with construction in Auckland planned to commence in December 2014. Each site will employ up to 50 people during the construction phase. Once operational each terminal will have 6 employees.

“This confirmation of start dates can be taken as a sign of the global company’s confidence in the strength of the New Zealand market and in particular the opportunities with the rebuild of Christchurch post earthquake,” he said.

“The confirmation that construction dates have been set will be welcomed by all in the construction industry and it will give confidence to those planning major projects and developments about security of supply of one of the key basic construction materials required.”

The Port of Auckland terminal enables HNZL to supply direct into one of its major markets.

The Port of Timaru terminal provides effective access to the major market of Christchurch, utilising the new NZ$5 million silo capacity completed in January 2014 at the Lyttelton Port of Christchurch. This terminal also provides effective distribution to the whole of the South Island market and the lower North Island as well.

Cement manufacturing

Building an import terminal at Timaru is also consistent with the option of eventually building a new cement plant at Weston in North Otago, which remains on hold for the foreseeable future.

HNZL intends to retain all the assets associated with the Weston site and project.

The timeframe for having both new terminals operational is planned for the second half of 2016. As with all construction projects, there may be changes to timeframes and these will be fully communicated.

HNZL announced in August 2013 that imported cement would replace local production at the company’s Westport cement plant, which will close once the two import terminals are fully operational.

The company has again updated Westport staff this week and confirmed that the window for the wind down of the operation is targeted for the second half of 2016.

HNZL is working hard to provide support to Westport staff and the community and to make sure they receive regular updates about the business strategy and progress.

New Zealand lime businesses

Jeremy Smith also announced that HNZL is reviewing its options for its lime businesses and that could include divesting part or all of the lime operations.

McDonald’s Lime Limited is majority owned by HNZL and part owned by New Zealand Steel.

Presently McDonald’s Lime owns and mines the country’s largest single lime quarry at Oparure, just north of Te Kuiti. The company has manufacturing plants at Otorohanga and Te Kuiti.

HNZL has been in discussion with its joint venture partner New Zealand Steel about this decision and has also briefed all McDonald’s staff.

Taylor’s Lime is based at Dunback in North Otago and is wholly owned by HNZL and those staff have also been briefed on this options assessment process.

Jeremy Smith says the lime businesses have a long history of success within the New Zealand operation and any potential part or full divestment is likely to attract international interest.

“There is a comprehensive process to go through to assess the options and HNZL has appointed a specialist advisor to assist with the process.”

HNZL management structure

The refining of the company’s strategic business plan and the significant decisions made in recent times means it was also timely to review the New Zealand management structure.

Jeremy Smith says the changes to the business model will eventually reduce the scale and scope of the New Zealand business over the coming years and it will, in effect, require a smaller corporate management operation. The decision has been taken that it would be logical to now combine the New Zealand and Australian operations.

“The New Zealand and Australian operations will become one business in effect. This also provides the opportunity for the New Zealand operation to leverage the presence and capability of the Australian operation which has more than 3000 people across 300 sites.”

“This combining of the two businesses will provide customers with the benefits of access to the technical resources and expertise of the company’s largest ready-mix and aggregates business in the region,” says Jeremy Smith.

The HNZL Managing Director position currently held by Jeremy Smith is being disestablished from the end of 2014; however, he will remain with the company into 2015 to assist with the handover and transition process.

An HNZL Country Manager will be appointed during late 2014 and will report to the CEO Holcim Australia and New Zealand from 1 January 2015. The new CEO of the combined entity will be Mark Campbell, currently CEO of Holcim Australia.

A plan for the handover of responsibilities from the current HNZL Managing Director to the CEO Holcim Australia and New Zealand and the yet to be appointed (NZ) Country Manager has been put in place.

Jeremy Smith says that whilst his role is being dis-established, he personally has full faith and confidence in what is being planned and proposed and believes this is the right strategy for the industry and for the New Zealand operation.

Adapted from press release by

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