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Lafarge in Nigeria. Guillaume Roux Executive Vice President, Lafarge Group. Lafarge in Brief. Lafarge was created in 1833 It is the world leader in building materials and holds top-ranking positions in all of its businesses: Cement – World Leader Aggregates & Concrete – No. 2 worldwide - PowerPoint PPT Presentation
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Lafarge in Nigeria
Guillaume RouxExecutive Vice President, Lafarge Group
Lafarge in Brief
Lafarge was created in 1833
It is the world leader in building materials and holds top-ranking positions in all of its businesses:
Cement – World Leader
Aggregates & Concrete – No. 2 worldwide
Gypsum – No. 3 worldwide
Operates in 79 countries with 2,200 industrial sites worldwide
Employs 84,000 people
19,033 million Euros in Sales as at December 31, 2008
Listed on Euronext Paris stock exchange
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A well balanced geographical portfolio,a worldwide presence in 79 countries on every continent
Central & Eastern EuropeWorkforce: 8,600Sales: 1,761 M€
Lafarge 2008 key figures
Western EuropeWorkforce: 17,900Sales: 6,021 M€
Asia Workforce: 20,900 Sales: 2,029 M€
Middle East Workforce: 6,400Sales: 1,611 M€
AfricaWorkforce: 11,200Sales: 2,373 M€
Latin AmericaWorkforce: 4,400Sales: 968 M€
North AmericaWorkforce: 14,200Sales: 4,270 M€
€19 billion in sales
84,000 people in 79 countries
2,200 industrial sites
Developed countries
54 % Sales – 40 % COI
Emerging countries
46% Sales - 60% COI
Lafarge in Brief
Our business: we extract mineral resources from the earth and transform them into major construction materials.
Our activities meet the basic needs of mankind by:
Providing housing and infrastructures all over the world.
Shaping the everyday surroundings of millions of men and women
Lafarge is more than ever at the heart of the way our societies are being transformed.
Lafarge has for many years pursued a sustainable development strategy.
In 2009 and for the fifth year in a row, Lafarge was listed in the ‘Global 100 Most Sustainable Corporations in the World’.
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Turnover – c450 M€
Employees – c2 000
5 integrated plants, 1 grinding station, 2 Import terminals
Total installed capacity – 5.5 MT in 2009 and c10 MT by 2012 horizon
Lafarge Presence in Nigeria
Source: company
Ashaka0.8
Wapco / Ewekoro1.3
Wapco / Sagamu0.8
Abuja
1 Grinding Station– 0.5MtaUnicem
Calabar
Lafarge / Atlas 0.5 Mta
Port Harcourt
UNICEM (JV of Lafarge, Holcim, Dangote, & Flour Mills): 2.5 Mta
Ewekoro / New Line2 MT by 2011
Lafarge plant
Grinding station
Imports terminalProjects
Sagamu / New Line2 MT by 2012
Our objective
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Maintain a leadership position in the country:
From 3.5 million tones in 2008 to 10 million tones by 2012
Contribute to the economic and social growth of the country
Reduce the dependence upon imports
BACK UP
Our main « people » challenges in Nigeria…
HEALTH and SAFETY FIRST: Our ambition is to rank among the top world-class industrial groups for safety performance by ensuring the safety of our employees and contractors
HEALTH: we are developing communication campaigns within our workforce about the fatal dangers of Malaria and AIDS and the ways to be better protected against these diseases
SAFETY: we have defined a common and compulsory policy, rules and standards in order to achieve significant improvement.
No lost time incident (LTI) in Ashaka for 970 days, but 3 fatalities and 6 LTIs in Wapco operations last year: a lot remains to be done to put safety in the heart of our culture
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Our main « people » challenges in Nigeria…
SUPPORT TO THE COMMUNITIES: communities living around our production sites expect that we support their development. On the other hand, we believe that there is no lasting leadership without both respect for the environment and social responsibility
We entertain close relationships with the communities to understand their needs and the ways to help their long lasting development
We support communities in many ways, going beyond our role as an economic player, with construction, housing, education, health care, heritage conservation, youth empowerment etc.
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Our main « people » challenges in Nigeria…
PEOPLE DEVELOPMENT:
It is our goal to promote first Nigerians into positions at all levels of the company
Specialized skills and professional experience are scarce, especially in the technical areas and away from large cities
• We organize a continuous development of our local talents through learning tracks and Individual Development Plans
• We expatriate Nigerians to other Group Units to long term training (management positions, new plant start up…)
It is difficult to attract “excellent” expatriates for the very few positions that cannot –temporarily- be occupied by Nigerians
• An overly negative image of the reality country…• Significant salary premiums are the normal practice in these
cases to overcome reluctance
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Other main challenges in Nigeria…
ENERGY SUPPLY: Power and gas are strategic inputs for the production of cement. Shortages are creating important damages to our capacity to deliver enough volumes from our production capacities
Wapco: 130 hours lost due to gas shortages and 180 hours lost due to power failures in the 1st Quarter 2009
We are now investing in own power plants or looking for Independent Power Providers to supply our needs in all our cement plants
We are investing in “dual firing” capacities to allow our kilns to use alternative energy sources: gas, fuel oil or even coal
• Development of our own coal mine in Ashaka
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Other main challenges in Nigeria…
LOGISTIC CONSTRAINTS
The lack of rail transport and professional trucking companies restrict our abilities to deliver our markets
• We have to accept to sell a large part of our production “ex-works”, limiting our customer service and our control of the destination of our products
• We collaborate with the more professional transporters to upgrade the safety and quality of their deliveries
The congestion of ports creates important difficulties and delays in the import of equipments / raw materials
• We have increased our level of “strategic spare parts” to avoid lengthy production disruptions
• We have to accept delays and higher costs for our investment projects
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Other main challenges in Nigeria…
ADMINISTRATIVE CONSTRAINTS:
Corporate Governance:• We have defined and communicated a rigorous “code of
business conduct” to be respected by all our employees• We have put in place a “whistle blower” system with an
independent auditor to identify abnormal activities• Continuous activities of internal control are required in all areas
of the business (sales, purchasing, stock management…)
Unstable legal environment
Restrictions on work permits for foreign workers
Import bans/restrictions for raw materials • In some areas, efforts and time are required to convince the
relevant authorities that regulations with apparent short term benefits can create a mid term disadvantage for the country
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