CHCC posts losses of Rs338 million amid ongoing price war amongst cement players

October 30, 2019 (MLN): Cherat Cement Company Limited (CHCC) has reported net losses of Rs. 338.5 million (LPS: Rs. 1.92) for the quarter ended September 30, 2019, against profits of Rs. 431.1 million (EPS: Rs. 2.44) in the same period last year.

The Board of Directors of the company also approved the setting up of approximately 12.6 MW Solar Power Project at the factory site, in order to reduce its electricity costs.

While the net revenue of the company improved by 34.1% on the back of higher cement dispatches, the cost of sales surged by 54% owing to an increase in energy cost as well as higher depreciation expense.

It is pertinent to note that the sales growth was hindered due to lower retention prices, as the major players of the cement industry have been embroiled in a price war.

A major highlight of the result was a 5x increase in finance costs, due to a hike in interest rates, as well as an increase in borrowings, post commissioning of the new plant.  

Copyright Mettis Link News