Bamburi Cement Group has today announced its 2021 Financial Year results reporting a pre-tax profit of Kes 2.2 billion, representing a 22.3% year-on-year increase from Kes 1.8 billion posted in 2020.
The company’s impressive result is on the back of positive volume and price performance coupled with robust cost management through various cost initiatives and operational efficiencies.
The outcome has also reflected the continued economic recovery from impact of the Covid-19 pandemic particularly in the construction sector.
The Group’s Turnover has increased by 19% from Kes 34.9 billion to Kes 41.4 billion which can be attributed to growth in retail and key account segment in both Kenya and Uganda.
Domestic selling price in Kenya improved much more as compared to prior year due to 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% to Kes 2.3 billion from Kes 2.0 billion, which 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 Kes 1.38 billion, 22.2% higher than the previous year. With this, the board has recommended a dividend payout of Kes 1.38 billion at the rate of Kes 3.58 per ordinary share subject to shareholders’ approval in the upcoming Annual General Meeting.
Mr. Seddiq Hassani, Bamburi Cement Group Managing Director said that they have made substantive progress on strategic cost optimization actions and sustainability initiatives leading to high levels of operational efficiency and the 17% increase in the operating profit.
Urging that as the cost of input raw materials continues to rise excessively, there will be a continuation in implementing these initiatives.
He added that they are committed towards innovation aimed at achieving better returns for our shareholders.
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 had been launched earlier this year.
There has also been a gradual embarking on the switch to green solar energy as part of the efforts towards saving on power costs and contributing to Net Zero goals.
Mr. Hassani said that the company envisages growth in cement demand supported by stable economic environment.
Suggesting that as it is currently in Uganda, cement demand is expected to be fueled by greater investment in public infrastructure especially as visualized in the oil industry.
Even though, the impact of the closure of the Uganda – Rwanda border is a downside risk though positive signs are embraced and believed in upon the reopening that has been observed as of earlier this year when it became operational.
Showing his optimism about a further growth in exports with the admission of Democratic Republic of Congo as the member of East Africa Community (EAC).
Dr. John Simba, the Bamburi Cement Group Chairman concluded that 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, noted that the impact of the coming general election is an unquantified risk factor which potentially might impact market dynamics in a manner still unknown and quite so so unpredictable being a contentious matter.