ARM Cement half-year losses up 400 per cent
In May the firm cited strained cash flow as well as increased competition and lower selling prices for its poor performance
timal utilisation rates, hence raising operational expenditure and compressing margins among cement producers, especially given the region’s price stagnation,” the report stated.
The firm’s revenue for the sixmonth period declined by 19.79 per cent to Sh5.35 billion compared to Sh6.67 billion last year.
In May the firm, whose shares trade on the Nairobi Securities Exchange, cited strained cash flow as well as increased competition and lower selling prices as key factors contributing to its poor performance.
Data collated by the Kenya National Bureau of Statistics shows that cement production for the first six months of the year went down by 3.93 per cent to 3.18 million metric tonnes from 3.31 million metric tonnes during the same period last year.
Cement consumption in Kenya fell by 62,000 metric tonnes in the first five months of the year, raising the prospect of the first annual decline in consumption in more than a decade.
Data by the state statistician shows that cement consumption for the period between January and May fell by 2.34 per cent to 2.5 million metric tonnes from 2.56 million metric tonnes consumed the same period last year.
“The quantity of cement produced dropped from 509,589 tonnes in May 2017 to 500,109 tonnes in June, 2017. Consumption of cement contracted from 497,087 tonnes in April 2017 to 457,937 tonnes in May 2017,” KNBS said in the June economic indicator report.
The country’s largest cement maker Bamburi Cement also reported net profit declines of about 36.21 per cent to Sh1.58 billion with a 8.21 per cent drop in revenue to Sh17.54 billion.