Lafarge Malayan pre-tax profit drops

Lafarge Malayan pre-tax profit drops
25 February 2011

Lafarge Malayan Cement Bhd reported a lower pre-tax profit of RM345.397 million for the financial year ended Dec 31, 2010, from RM441.9 million registered in the same period of 2009.

Revenue slipped slightly to RM2.324 billion, during the period under review, from RM2.483 billion registered previously, it said in a filing to Bursa Malaysia.

It attributed the lower revenue to lower export volume and prices coupled with a weaker US dollar and reduced sales in Singapore.

"The lower profit (also) was mainly attributed to lower export contribution, higher fuel costs in the second-half year and bigger losses in the ready-mixed concrete business in Singapore," it said.

These adverse impacts were partly compensated by lower fixed cost attributable to the tighter cost control, said Lafarge.

On a quarterly basis, Lafarge’s pre-tax profit declined to RM94.794 million in the fourth-quarter of 2010 against a pre-tax profit of RM123.983 million recorded in the same quarter of 2009.

Revenue declined to RM617.8 million, from RM624.48 million, chalked up in the previous corresponding quarter.

On outlook, it said with more projects and contracts expected to be awarded under the 10th Malaysia Plan and the Economic Transformation Programme, the group expected a more active construction sector in 2011 and was optimistic of growth in domestic cement demand in 2011.

However, contribution from exports was likely to remain low.

"With coal and other fuel prices already moving up in the beginning of 2011, the group is facing a margin squeeze due to rising costs of fuel and other materials," it said.

The group would continue to intensify efforts to improve plant performance and other cost control measures and, was optimistic group results for the year would remain satisfactory.
Published under Cement News