VILNIUS - Akmenes Cementas (Stone Cement) announced last week that it was curbing exports in order to keep up with domestic demand and would borrow some 61 million euros in a syndicated deal to modernize its cement plant, the only one in Lithuania. Akmenes Cementas' chief executive said the company has halted exports to Finland and the Russian exclave of Kaliningrad as it struggles to meet demand for cement in Lithuania, which is currently undergoing a construction boom.
"We're trying to meet surging demand on Lithuania's market 's that is why the agreements on exports to Russia's Kaliningrad region and Finland have not been extended," CEO Arturas Zaremba told the Baltic News Service.
He said the company's output would be marketed in Lithuania, with about 10 percent to be exported to Latvia. Deliveries to Latvia cannot be suspended since the export agreement would remain in effect until the end of the year, he explained.
He did add, however, that shipments to Latvia could cease beginning in 2008.
Last year the cement manufacturer sold around 80 percent of its products in Lithuania, with the rest exported to Latvia and Finland. This year Akmenes Cementas has targeted an increase in production by 5 percent and in sales of about 15 percent (annual).
Lithuanian construction firms, like those in Latvia and Estonia, are scrambling to fill orders and meet deadlines. Builders executed projects worth 1.6 billion litas (480 million euros) during the first quarter of 2007, a surge of 43 percent from a year earlier, the Statistics Department reported last week.
Akmenes Cementas also intends to modernize its facilities by borrowing 212 million litas. The company will contribute 78 million litas from its own resources to the project, which is estimated to cost a total of 290 million litas.
The company expects to complete the project, which will allow the company to shift from wet to dry cement production technology, by 2011.
The new technology will also enable the plant to boost annual production capacity by 25 percent to 1.5 million tons and meet growing demand for cement.
Akmenes Cementas' annual net profit soared to 25.1 million litas last year, from 2.8 million litas in 2005. Revenues amounted to 188 million litas (54.5 million euros) last year, with cement sales exceeding 1 million tons.
Four individuals, all Lithuanians, hold a combined stake of 51 percent in Akmenes Cementas, while Cemex, the Mexican cement giant, controls 33.95 percent of voting shares through a subsidiary company.
The cement plant is located in Naujoji Akmene, in northwestern Lithuania.
