CYPRUS: Vassiliko cement building on construction boom

Riding on the Cyprus construction boom of recent years, Vassiliko Cement Works has seen its cement sales to local industry increase by 17% in 2018, continuing a steady but upward 4-year trend.

Vassiliko said the increase is a continuation of the growth in sales of cement to the local market after the construction industry stagnated in 2008. From 2008 to 2015, the construction industry in Cyprus had been shrinking.

In 2014, cement sales reached only 23% of sales made in 2008, reflecting the downward spiral the construction sector suffered at that time.

Although not at a satisfactory rate, cement sales have been slowly picking up pace since 2015. It is indicative that in 2018 alone, we have reached 45% of cement consumption. A significant improvement, yet not enough for us to feel comfortable with, said Vassiliko general manager George Savva.

He said that they expect the trend to continue in 2019, predicting sales will be equivalent to 50% of those in 2008.

According to its 2018 annual financial report, Vassiliko saw its overall income dropping from EUR 102.4 mln to 97.9 mln, due to the decrease in cement exports and the rise in the cost of energy (electricity and fossil fuels), as well as the increase in the price of carbon dioxide emission allowances.

Active since 1963, Vassiliko has been producing cement products for the local industry and export from the port it built in 1983 at Vassiliko.

The company listed on the Cyprus Stock Exchange since 1996, is dedicated to the production of cement, spending EUR 185 mln in 2011 on installing a new state-of-the-art Clinker unit (the main raw material for cement production).

Savva said the company has since spent significant amounts on upgrading their production line in order to comply with EU environmental directives and standards.

Complying with environmental regulations and best practices as well as having sustainable growth are equally important for Vassiliko Cement, as our financial performance.

Alternative fuels

The Company has made significant investments in efforts to increase the use of alternative fuels and reduce its CO2 emissions from the clinker production process.

Last year Vassiliko substituted 45% of fuel used for heat production and reduced CO2 emissions from clinker production by 10%.

It has also focused on reducing the percentage of clinker used for cement production. With the use of alternative fuels, a significant reduction in emissions of nitrogen oxides (acidifying gas) has also been achieved.

Vassiliko uses sewage sludge from biological purification plants and ground meat as alternative fuels which significantly reduces CO2 emissions.

As a heavy industry we are called upon to help support the transition to a cyclical economy, and that is exactly what we want to do, adopting important innovations and technologies.

Vassiliko’s boss said that the company is to continue its efforts to reduce its CO2 emissions from clinker production. Their aim is to increase the use of alternative fuels, which is expected to exceed 50% this year.

Meanwhile, the company is investing in research and development in efforts to reduce the clinker rate used for cement production, but also in the use of raw materials with lower CO2 emissions.

The use of alternative fuels can be profitable if there is proper design and optimization of the production process, so that there is no serious negative impact on the quality of the products produced, on productivity and on the consumption of electricity.

Vassiliko was also active in the quarry industry but has pulled out, selling to its partners Latouros Quarries and Pyrga Quarries Ltd. Savva said the company wants to concentrate exclusively on its main activities, producing clinker and cement.

Vassiliko has designed its strategy for the years ahead to ensure sustainable growth and competitive advantage in the markets it focuses on. We aim to keep setting higher goals regarding technological upgrading, human capital development, said Savva.

The company’s strategic plan includes infrastructure projects aimed at continuously upgrading the Company’s environmental performance.

Savva said the next strategic goal is to build a photovoltaic park with a capacity of 8MW, which will be built on privately owned land and is expected to cover 8-10% of the electricity production needs.

He was appointed General Manager of Vassiliko at an Executive Board meeting held on 30 May and given the task of overseeing the company’s strategic plan.

Savva was born in Famagusta in 1970. He graduated from London South Bank University where he studied Accounting and Finance (BA (Hons) in Accounting and Finance).

In January 2001 he was appointed Chief Financial Officer at Vassiliko Cement Works and since August 1, 2017, he held the position of Deputy General Manager.

Source: The Financial Mirror