Bamburi Cement Plc has posted a 13% decline in activity for the first half of 2020 at Kes16.2billion which as compared to the Kes18.7 billion the company posted in a similar period last year
The company has attributed the decline to the world-wide pandemic of COVID-19 which brought along an economic strain globally, with Kenya and the greater East African region having instituted containment measures in the first half of 2020, causing a gradual decline in activity in the building and construction industry driven by construction site closures.
The Group’s profit before tax for the first half of 2020 grew to Kes 213 million from Kes.23 milion recorded a similar period last year. This growth has been achieved despite the decline in the turnover in both countries.
Other gains and losses increased to Kes116m from a loss of kes61 million in the period ended 30th June. The increase in other gains and losses was on account of the strengthening of the Uganda shilling against other major currencies, particularly the reporting Kenya Shilling.
The financial expenses reduced by 24% to Kes133 million, as a result of the optimization of cash resources within the Group.
The profit after tax was Kes721 million which was an increase from the period ending 30th June in the previous year which was kes393 million. This was due to a tax credit of Kes508 million that arises from the adjustment of deferred tax liability in line with the new corporate tax rate in Kenya of 25%.
The cash flow generated from operations was kes3, 048 million this was a 40% increase from kes1, 229 million in the same period last year.
Working Capital optimization initiatives, executed as part of COVID- 19 impact mitigation measures, has seen the group Current Assets, mainly Inventory and Receivables, reduce significantly by Kes1.4 billion from end 2019 position. Consequently, the Group’s liquidity and balance sheet remains solid with a good foundation for future leveraged growth.
The adverse impact of COVID 19 pandemic is expected to carry on into the second half of 2020. The Group’s priority continues to be the implementation of necessary measures to enhance business resilience and to protect the health and safety of employees and their families. These measures are delivering results as the group is registering cost savings and improved cash generation to counter the decline in topline.