Lafarge’s FY2019 volumes stable despite poor sectoral performance

  • Construction sector growth declined by 14%
  • Completion of DMX plant is set for Q2 2020
  • Q12020 volumes were 3% above budget

Harare – Lafarge Cement Zimbabwe’s volumes for the full year ended 31 December 2019 remained flat on prior year at 323 000 tons.

In a statement accompanying the Company’s financial results for the year under review, the Company’s Chairman, Kumbirai Katsande said the performance was commendable as growth in the construction sector declined by 14% , quoting the Reserve Bank of Zimbabwe (RBZ) figures.

The Company’s Individual Home Builder (IHB) category continued to contribute to the business’ top line, spurring revenue growth.

Inflation adjusted revenues for the Company grew by 105% from ZWL 449 million in 2018 to ZWL 919 million in the period under review.

The Company’s focus on agile pricing and disciplined cost management across the business resulted in improved gross profit margins which grew to ZWL 496 million in 2019 from ZWL 141 million in the prior comparable period.

Lafarge commenced the implementation of its previously announced USD25 million capital expansion programme in the year under review.

“The major projects that the business will invest in are set to improve cement milling capacity, automate the Dry Mortar Mix (DMX) plant and improve production of agricultural lime and other key projects to improve power supply and cement storage”, Mr. Katsande said.

He added that the manufacturing of the USD2 million DMX equipment was completed and installation of the equipment on site is set to be completed in the second half of 2020 and that the Directors are positive that these investments will elevate the business’ manufacturing platform and allow it to boost its productive capacity.

Meanwhile, the Company’s volumes in the quarter ended 31 March 2020 (Q12020) were in line with the prior year and 3% above budget and although the average selling prices (ASP) achieved were below those of the prior year, the product mix was favourable against budget.

Lafarge Cement Zimbabwe Limited is a member one the leading cement manufacturers in the country and is a member of multi-national company, LafargeHolcim Group.

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