Brazil: Votorantim takes protective measures

Brazil: Votorantim takes protective measures
06 July 2016

Prompted by the unfavourable environment in Brazil and the decline in cement sales in the country, Votorantim Cimentos has adopted new measures in an attempt to maintain its competitiveness. The company will focus on innovation, productivity and performance in strategic markets in the second half of 2016.

According to the National Cement Industry Union (SNIC), cement sales fell 13.9 per cent in the domestic market between January and May 2016 compared with the same period last year. In addition to a decline in sales, Votorantim’s expenses can be linked to the IPCA (consumer price index) in Brazil, which increased by approximately 18.2 per cent in the last two years.

Given this difficult environment, Votorantim has taken steps to maintain its financial and operational strength, but these initiatives have not been entirely sufficient in absorbing the impact of the increases. Votorantim’s Sales & Marketing and Concrete Business Director, Mauricio Russomanno, said, “Following other sectors that have been as strongly impacted by the crisis and the inflationary process as our industry, we’ll need to adjust our portfolio to this reality by passing on part of last year’s inflation to our products.”

Despite this, the company is committed to maintaining its aim of investing BRL5bn (US$1.51bn) by 2018, focussing on the long term in Brazil and abroad in line with its strategy of geographical diversification of its operations. Mr Russomanno concluded saying, “We are confident that the country will soon resume its growth trajectory, thus boosting our industry.”

Published under Cement News