Athi River pretax profit rises, Kenya

Kenya-based firm, Athi River Mining, posted a 23 per cent rise in 2011 pretax profit to KES1.36bn (US$16.4m), the company said while net profit came in at KES1150m.

Turnover rose 37 per cent to KES8.2bn while cement sales increased 72 per cent helped by the commissioning of new capacities which came on-stream in late 2010. EBITDA rose 31 per cent from KES1.6bn in 2010 to KES2.2bn last year but operating margins were down two per cent in 2011 mainly due to the “rapid increases in cost of electricity, fuel and imported spare parts,” the company said in a statement.

During the year, the Kenya shilling experienced high foreign exchange rate volatility and depreciated substantially. However, as at year-end, the trend reversed and unrealized exchange losses stood at KES118m against KES681m when the company reported group results for the first nine months of 2011.The Kenyan shilling has strengthened again since January 2012.

Late last year, the company acquired a controlling interest in a 100,000tpa grinding plant in Kigali, Rwanda, which has contributed to Athi River Mining’s regional expansion strategy. The group is also nearing completion of a grinding plant in Tanzania as well as constructing a clinker plant and another grinding works, both scheduled to be operational in early 2013.

Going forward, the group expects the new Tanzanian grinding plant to contribute further growth to the company’s turnover in the 2H12. On the domestic front, it sees a possible slowdown in the construction industry toward the end of the year as Kenya prepares for elections towards.