“Every time I’ve come to Romania, I’ve been impressed by the people’s quality and ambition,” Fontana told ZF during his first visit to Romania since taking the CEO position in February last year. Romania continues to have a real [managerial] talent pool, even though its population is in decline, he added.
Fontana has previously been in Romania on several occasions while working for the ArcelorMittal steel producer, which required him to visit its plant in Galati (SE Romania).
A number of 44 Romanians are working on various international positions at Holcim, such as Horia Adrian, area manager for Eastern and South-Eastern Europe, Claudiu Soare, CEO of the Serbian subsidiary of Holcim, and Roxana Marin-Simen, head of Holcim group CEO Office.
Romania is a market with a lot of potential in the construction industry, as it needs to build transport infrastructure or housing unlike mature markets like those in Western Europe, Fontana said. The country provides mainly infrastructure development opportunities because it has EU funds available.
“The country is also attractive for foreign direct investments and holds a strategic position in Europe,” Fontana added admitting there are a series of risks in Romania, the most serious of which were unpredictability and legislation enforcement.
Asked whether Holcim planned to invest in new production facilities in Romania over the next few years, Fontana answered that the market level did not justify a new facility for the time being, as Holcim’s current plants operated at 60% capacity.
The company is now conducting more than EUR30 million investments in production efficiency improvement and power consumption reduction.
Holcim entered in Romania in 1997 and has invested more than EUR700 million so far, which makes it one of the biggest investors in the local construction industry. It ended last year with EUR213 million revenue and net loss of EUR8.5 million, and 2012 was the first year in well over a decade when the company posted loss.
Holcim Romania has two plants in Campulung and Alesd, a grinding station and a cement terminal in Turda, 16 concrete mixing stations, 5 aggregates stations, 2 special binders plants and a cement terminal in Bucharest.
The trend throughout the world is to raise cement price, because the industry needs high investments that have to be recouped and costs, such as energy costs in an energy-intensive sector are rising, Fontana said.
The growth drivers of the cement market are the worldwide population growth and the increase in urbanization, he added.
The local cement market amounts to about EUR600 million to EUR700 million a year. Holcim’s rivals in Romania are Lafarge and HeidelbergCement (CarpatCement).
(English version by Loredana Fratila-Cristescu)