TANGA Cement Company Limited profit for 2015 has declined to 8.24bn/- compared to 28.40bn/- of the preceding year.
According to the audited financial
results, the group experienced a decline in sales revenue of 9.9 per
cent to 209.11bn/- compared to 232.10bn/- of the preceding year.
The decline was contributed by increased
competition from new entrants to the market which put downward pressure
on sales prices and volumes.
At the macroeconomic level, the cement
firm witnessed a significant devaluation of the local currency to the US
dollars in excess of 20 per cent.
Also the Group accounted for the
realised and unrealised losses on foreign exchange amounting to 9.97bn/-
in the year under review compared to 3.65bn/- of the year before.
Similarly, the cement company
experienced setbacks in terms of overall equipment efficiencies and some
unplanned equipment failures during the year under review.
The unavailability and poor quality of
electricity supply from the national utility remains a major challenge
for equipment efficiency which resulted in the importing of more
expensive clinker which negatively impacted on the cost of production of
cement.
However, the Dar es Salaam Stock
Exchange (DSE) listed company commissioned its second kiln for the first
time on December last year and produced the first clinker in accordance
with the original project plan.
The report said the operation of the new
kiln was a significant achievement for the cement firm as the project
was executed within the planned timeframe.The project was concluded
within the approved capex budget of 152 million US dollars.
“We expect market conditions to remain
challenging in the coming year but the management is confident that the
initiatives will yield positive financial returns,” stated the report.
It added, “A number of critical
infrastructure projects have been approved by the government funded by
both sovereign foreign direct investments and private investors and
these are most likely to increase demand for our products,”
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