East Africa Portland Cement company has recorded a net loss of Ksh2.8 billion for the year ended June 30, 2020 which is lower than the Ksh3.4 billion net loss recorded last year. Revenues for the year ended 30 June 2020 declined by 13 percent to Ksh2.47 billion from Ksh2.85 billion at the end of June 30, 2019. The cement maker cites increased competition from rival cement companies as the reason behind the lower revenues this year.
The cost of sales fell to Ksh3.3 billion in the period under review from the Ksh4.05 billion registered last year. The administration and selling expenses declined to Ksh2.50 billion from the Ksh2.55 billion recorded in a similar period in 2019.
Total assets declined in the period under review to Ksh35.18 billion from Ksh36.54 billion at the end of June 2019. Total liabilities rose marginally to Ksh16.42 billion in the period under review from Ksh15.02 billion at the end of the last financial period.
The gross loss narrowed to Ksh825 million from Ksh1.2 billion in 2019 on account of reduction of factory staff costs. In the year, the firm declared all positions redundant sacking 800 employees and 136 managers and supervisors. The firm’s general operating expenses reduced by 2 percent following the staff restructuring exercise.
The restructuring program saw the cement maker announce a voluntary early retirement scheme in February this year in response to the financial challenges from COVID-19.
East African portland cement says that it recorded fair value gain on investment property of KSh1.1 billion in the period under review.
The board says that completing the balance sheet restructuring remains a top priority aimed towards recapitalizing the company. In the medium term, the board is optimistic that continuos emphasis on optimization and revenue enhancement through the improvement of productivity and efficient use of resources will improve the bottom line.
Furthermore, the firm has embarked on comprehensive reengineering of its route to market value chain management that will improve service delivery to its customers. The board did not declare any dividends for the period.
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