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Cement manufacturer, Lafarge sprung back to profitability, posting a $3,1 million net profit for the year ended December, 2016 from a $1,9 million loss the previous year.
Group chairman, Kumbirai Katsande said the firm’s ability to swim out of the red pointed to its “strong competitive tenacity, resilience and high performance culture of the management team.”
“It is important to note that this performance comes after significant financial cleaning up in the prior year of slow moving inventories, non-performing debtors and spares provisions,” he said.
The cement producer saw it revenues marginally increase to $61 million from $60,9 million after product volumes went up 2 percent.
Cost savings in operations, plant maintenance and “better” inventory control as well as a revaluation of plant property and equipment also contributed to the positive performance.
The company declared a dividend of 2,5 cents per share. Basic earnings per share jumped to 0,039 from a loss per share of 0,025 in prior year.
In the period, Lafarge invested about $9 million in property, plant and equipment upgrades. The company did not record any fatalities during the period.
Foreign currency shortages affecting the economy also hit on the cement producer with Mr Katsande saying the company’s current liabilities shot up
50 percent to $35 million.
Overall lack of major infrastructural development projects in the country as a result of a liquidity crunch was forcing the cement industry to perform below installed capacity, he said.
In terms of its balance sheet, the value of Lafarge’s total assets went up to $82 million from $65 million pushed by current assets, which surged 37 percent.
In the outlook, Mr Katsande said the company was expected to remain profitable. — New Ziana.
Online Reporter