Lafarge Cement Zimbabwe full-year volumes down

Lafarge Cement Zimbabwe full-year volumes down
27 March 2015

Lafarge Cement Zimbabwe's volumes came off by 7.4 per cent to 312,000t for the year ended 31 December 2014 from 337,000t in the prior year.  The decline in sales was attributed to a number of commercial and residential projects taking long to be completed due to persistent liquidity challenges.

Analysts said there was huge potential for the cement business given the housing and infrastructure backlog but in the interim, the company had to devise strategies to survive weak demand.

Lafarge Cement Zimbabwe's group finance director, Farai Matanhire, said the overall domestic market for cement remained largely flat during the period under review.

"Lafarge's core market for individual home building projects was affected by the liquidity issues so demand in that part of aggregate market was flat. The shift of market requirements towards high strength cement also affected the volumes as Lafarge was not able to offer this," he said.

"We launched a new product called Supaset because we had realised that the market preferred high strength cement," he said.

During the period under review, the company's capital expenditure was at US$7.2m, of which US$4.9m was in limestone quarry development.

Market share dropped marginally from 34 to 31 per cent in the year to the end of December 2014. The company attributed the negative performance to weak demand due to low disposable income levels and a drop in cement prices.

Published under Cement News