Lafarge inaugurates a new cement plant, Mexico

Lafarge inaugurates a new cement plant, Mexico
Published: 27 April 2006

Lafarge announces that it is doubling its grey cement production capacity in Mexico with the inauguration of a state-of-the-art cement plant at Tula, near Mexico City. The new plant, which will be inaugurated today in the presence of the Mexican Minister for the Economy, represents a total investment of US$120m for an annual production capacity of 600,000t.

This modern, low cost, strategically located plant reinforces Lafarge’s participation in the growth of the Mexican cement market. As one of the most competitive plants in the area, it should rapidly create value for the Group. As a first step, this investment should generate an EBITDA improvement greater than EUR 20M as soon as 2008.

Equipped with the latest technology and complying with the Group’s environmental standards, the plant will allow Lafarge to offer a range of superior quality products in grey cement to the local market. White cement will continue to be produced at the Group’s nearby cement works at Vito, where capacity has also recently been doubled with a significant improvement in product quality.

The construction of the state-of-the-art plant at Tula has been a success for the Group: the plant was delivered four months ahead of schedule, has beaten all the Group’s records in terms of safety and is already running at close to full capacity.

"I am particularly proud to inaugurate this new, state-of-the-art cement plant, exemplifying what Lafarge excels at: leading the way in innovation, technology, sustainable development and performance. We have been operating in Mexico since 1999, and have developed a sound knowledge of this growing market, our clients and their specific needs. The construction and the start-up of the plant have been a true success, in terms of efficiency, safety and industrial performance. We are now ready to deliver the benefits to our clients and our shareholders" said Bruno Lafont, chief executive officer of Lafarge.

Lafarge first entered the Mexican cement market in 1999 through its subsidiary Lafarge Cementos. In 2003 the Group announced the project to construct a new cement plant in Tula near to its existing plant in Vito. The Group is also in the Mexican gypsum market via a joint-venture with Comex (Comercial
de Pinturas Mexicanas), with the ongoing construction of a gypsum wallboard plant. The Group is also present in Mexico in roofing, through two joint ventures.