Bamburi Cement Group has announced its 2021 Financial Year results reporting a pre-tax profit of Ksh2.2 billion, representing a 22.3 percent year-on-year increase from Ksh1.8 billion posted in 2020. The company’s impressive result is on the back of the positive volume and price performance coupled with robust cost management through various cost initiatives and operational efficiencies.
The performance also reflects the continued economic recovery from the impact of the Covid-19 pandemic particularly in the construction sector. The Group’s Turnover increased by 19 percent from Ksh34.9 billion to Ksh41.4 billion. This was attributed to growth in retail and key account segment in both Kenya and Uganda. Domestic selling prices in Kenya improved compared to the prior year due to a higher proportion of premium products sales and targeted price actions in the retail segment.
The cement maker’s operating profit for the year grew by 17 percent to Ksh2.3 billion from Ksh2.0 billion. This was achieved despite 2021 being an inflationary year with prices of coal, power, imported clinker and global fuel increasing and adversely affecting the company’s cost base.
The company’s net profit was Ksh1.38 billion, 22.2 percent higher than the previous year. With this, the board has recommended a dividend payout of Ksh1.38 billion at the rate of Ksh3.58 per ordinary share subject to shareholders’ approval in the upcoming Annual General Meeting.
Mr Seddiq Hassani, Bamburi Cement Group Managing Director commented: “We made substantive progress on our strategic cost optimization actions and sustainability initiatives leading to high levels of operational efficiency and the 17 percent increase in our operating profit. As the cost of input raw materials continues to rise excessively, we will continue implementing these initiatives”.
“Our commitment towards innovation aimed at achieving better returns for our shareholders continues. For example, one of the investments made was looking to fill a gap in the untapped specialized mortar segment and Bamburi TectorCeram SETI 300, a ready-to-use tile adhesive under this range has been launched this year. We have also been gradually embarking on the switch to green solar energy as part of our efforts towards saving on power costs and contributing to Net Zero goals” he added.
Mr Hassani said the company envisages growth in cement demand supported by a stable economic environment. In Uganda, cement demand is expected to be fueled by greater investment in public infrastructure, especially in the oil industry. However, the impact of the closure of the Uganda – Rwanda border is a downside risk though positive signs on the reopening have been observed at the beginning of 2022. He is also optimistic about further growth in exports with the admission of the Democratic Republic of Congo to the EAC.
Dr John Simba, the Bamburi Cement Group Chairman concluded: “In Kenya, the big four government agenda in the areas of affordable housing and significant investments in infrastructure projects in the pipeline (roads, railways, ports, special economic zones) is expected to fuel the growth of cement market. However, the impact of the coming general election is an unquantified risk factor which potentially might impact market dynamics”.
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