KENYA – Bamburi Cement Group, an industrial company specialising in cement and concrete, has delivered improved profitability for the full year ended December 2019, posting a 17% jump in profit before tax to KSh0.73 billion (US$6.88m) as compared to KSh0.62 billion (US$5.85m) in 2018.
The improved profitability was largely driven by cost cutting and optimization initiative undertaken by the Group under the “Building for Growth” strategy.
The Group turnover also dropped by 1.1 per cent to KSh36.8 billion (US$346.95m) compared to KSh37.2 billion (US$350.73m) in 2018.
“The slightly lower Turnover is attributed to a comparatively adverse market situation in 2019 compared to 2018,” read the firm’s financial statement.
The absence of the investment deduction allowance benefit for Hima in 2019, plus the suspension of Rwanda operations led to high tax charges thus dropping the firm’s comprehensive income by 74 per cent to KSh350 million (US$3.3m) from KSh1.348 billion (US$12.71m) in 2018.
In Kenya, overall sales were also impacted by the shift of volumes previously exported to Uganda from Bamburi Cement, following the commissioning of Hima Cement capacity expansion project in 2018, further shaving off volumes out of Bamburi Cement.
“Bamburi Cement and Hima Cement have remained resilient despite the challenging economic conditions witnessed in the various markets and the wider regional economy,” said Group Managing Director Seddiq Hassani.
“Despite market challenges, including the absence of sales to Rwanda through Hima, the shelving of major infrastructural projects such as Phase 2B of the Standard Gauge Railway (SGR) project in Kenya and price erosion fueled by aggressive competitive pressure; both Bamburi Cement and Hima Cement grew share while sustaining respective market leadership,” Hassani said.
“The Group’s outlook for the Kenyan and Ugandan market remains cautious in the wake of the Covid-19 pandemic outbreak,” said the Group Chairman John Simba.
He added that the group will continue to execute its Strategy 2022 agenda focusing on customers to drive topline growth,cost optimization, people, financial strength and sustainability.
Bamburi Cement Limited, a subsidiary of LafargeHolcim, and is a leading cement manufacturing and marketing Company in the Eastern Africa region, having been operational for 63 years. It has three subsidiaries Hima Cement Ltd (Uganda), Bamburi Special Products Ltd and Lafarge Ecosystems Ltd.