Bamburi profits take a beating

By Standard Reporter

Cement maker, Bamburi’s pre-tax profits dropped to Sh3.5 billion in the first-half this year.

Mr Hussein Mansi, the company’s Managing Director, however, said, the firm is poised for greater growth as the State invests more in infrastructure and enhances its economic stimulus programme.

"We anticipate our sales in this market will continue to grow in the second-half of 2010," he said.

He said the strength of the company’s cost containment activities, such as an improved distribution system, continued to favourably impact on the results.

Strategic advantage

" We expect this strategic advantage to continue to improve the group’s performance in the coming year," said Mansi.

He said lower debt and resilient operating margins have been achieved through calculated cost containment and strong cash management.

He said these efforts would be bolstered by increased capacity, when its Kasese plant in Uganda is fully operational later this month, and continued reduction of the group’s net debt.

He said the current strategic development of more innovative products for the entire East African market continue to strengthen the Lafarge Bamburi Cement Group and will reinforce its market position.

In a statement yesterday, Mr Mansi said the group’s turnover reduced to Sh13 billion as a result of slow growth in the cement market in Kenya and Uganda, lower selling prices across all markets and the base effect of unusually higher market share recorded during the first-half of 2010.

The non-current obligations increased by Sh1.25 billion to finance the capacity expansion project.

During the period, the group accelerated repayment of unsecured US dollar denominated loan from Lafarge by $14 million to mitigate hard currency exposure.