Bamburi in Sh4.3 billion profit

• Cement maker says it was able to recover from post-poll chaos

Bamburi Cement Group has announced a 49 per cent increase in pre-tax profit for the half year ending June 30.

The company’s earning rose from Sh2.9 billion to Sh4.3 billion compared to a corresponding period last year.  

According to the management, the results indicated a remarkable recovery from the effects of post-election violence in 2008, which disrupted construction in some areas and blocked sale of cement in others.

Domestic market

The company’s turnover increased by 41.5 per cent from Sh11.5 billion to Sh16.2 billion driven by a strong resurgence of the domestic market despite the challenges faced during the same period last year.

The income was also boosted by improved export sales to inland African markets.

Group chairman Richard Kemoli said the results demonstrated the resilience of the company in the difficult economic conditions spurred by global economic downturn and increased competition.

Production costs rose by 52 per cent due to surging prices of fuel-oil, power and coal, the inflationary trends due to the depreciation of the local currency and the poor and erratic power quality and supply in Uganda.

The board proposed an interim dividend of Sh1.50 per ordinary share totalling to about Sh545 million, which is payable on or about 23rd of October. Earnings per share went up by 55.1 per cent to Sh8.19.  

Business model

Bamburi said that the construction of a Sh7 billion new clinker and cement plant in Uganda is going on and is expected to be commissioned by mid 2010.

The firm will use more of its internally generated cash to finance the remainder of the project. Group MD Hussein Mansi said the firm would continue to follow its business model at all times to realise good results.

However, the company expressed concern over the slowing down of economic growth in countries where their products are sold.