Caribbean Cement doubles quarterly profits

The Caribbean Cement Company (CCC) more than doubled its quarterly profits during the April-June quarter 2017, reports the Gleaner. Net profit grew to US$606m after tax, over three months, or 174 per cent higher than the similar period a year earlier.

"This was achieved through cost-saving initiatives which were implemented, resulting in lower fixed and administrative costs," stated management in the financial report signed by Chairman, Parris Lyew-Ayee, and Director Jose Luis Seijo Gonzalez.

However, the group made eight per cent less revenue at US$3.9bn, down from US$4.3bn a year earlier, "mainly due to the reduction in exports," said the company management. During the quarter, the company took the decision to focus all resources on the local market, thus suspending exports.

That reduction in top line revenue contributed to a drop in trading profit (EBITDA) from US$1.3bn a year earlier to US$778m in the review quarter. The group, however, benefitted from booking no restructuring costs this year compared with US$420.7m a year, earlier. That resulted in decreasing overall expenses and increasing profitability.

Earlier this month, Caribbean Cement announced that it will invest US$24.7m over the next 12 months to complete a coal mill and kiln, and implement green energy programmes. The capital expenditure would push cement production from 910,000t to 1.2Mta by 2019.

At the same time, the company revealed that it plans to refinance its costly operating lease for the Rockfort plant in Kingston. Last year, Carib Cement paid US$3.3bn to TCL as operating lease for the assets it owns at Rockfort. This year, it projects to pay roughly US$2.8bn.