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Muchadei Masunda

Senior Business Reporter
LAFARGE cement has cleared bank loans amounting to $4,84 million after the company’s total available cash for the year ended December 31, 2015, stood at $8,02 million.

The company’s acting chairman, Muchadei Masunda, said cash from operating activities increased by 72 percent over the prior year to $6,13 million.

“The company generated $6,13 million in cash from operating activities, an increase of 72 percent over the prior year, resulting in total available cash in the year of $8,02 million, of which $3,03 million was invested in property, plant and equipment and $4,84 million went towards the repayment resulting in total available cash. The company ended the year with no borrowings after paying off all bank loans,” he said.

Lafarge recorded a loss after tax amounting to $1,97 million from a profit of $0,08 million in 2014. During the financial year under review, earnings before interest and tax decreased by 230 percent to a loss of $1,68 million from a profit of $1,29 million in 2014.

Masunda said total current assets decreased by 13 percent mainly due to the reduction in inventory arising from the obsolescence provisions.

“Total equity reduced marginally by five percent due to the reduction in retained earnings driven by the loss for the year.

“Total current liabilities decreased marginally by four percent to $23,36 million mainly due to repayment of borrowings.

“The net impact of these movements resulted in a decrease in net working capital of $2,86 million from the prior year,” said Masunda.

Despite the economic hardships facing the country, he said the company’s cement sales volumes grew by five percent above the prior year.

This was largely driven by the successful implementation of the market growth strategies of leveraging targeted distribution that was supported by the overall domestic market stabilisation.

“Average prices experienced pressure from low end players who demanded and received bulk discounts. Consequently, the sales revenue for the full year increased to $61,55 million from $60,45 million, representing a two percent growth driven by sales volumes but countered by a sub-optimal portfolio and price mix,” he said.

During the period under review, Lafarge secured new market segments that generated incremental sales volumes following its strategy to enhance market penetration and operational initiatives.