Cement manufacturer, East African Portland Cement (EAPC), has posted a Ksh. 1.035 billion net loss for the half-year period ending December 31, 2020. This loss came after a challenging period that saw a significant drop in activity in the construction sector.
The half-year net loss was a 34% improvement from the Ksh 1.575 billion loss posted in the same half-year period the previous year.
With the effect of COVID-19 in the real estate and construction industry saw EAPC’s half year revenue fall by 6.3% to Ksh 1.39 billion from Ksh. 1.48 billion a year ago.
East African Portland Cement managed to lower its administrative expenses by 50% to Ksh. 540.5 million, from Ksh. 1.075 billion a year earlier. This was achieved by realigning the manpower cost to the current productivity level.
In the financial report, East African Portland Cement said that it is on the verge of terminating its corporate loan facility. The loan settlement will eliminate the high finance costs through a balance sheet restructuring program. The company expects the restructuring program to yield adequate cash inflows to support its working capital needs . The program will also fund a plant refurbishment needed to attain a competitive cost of production.
The firm’s total assets fell to Ksh. 34.6 billion at the end of the half year period, compared to Ksh. 35.2 billion six months earlier. Its total liabilities went up by Ksh. 418 million in the six months period, to Ksh. 16.84 billion from Ksh. 16.42 billion at the end of June 2020.
The board of directors is optimistic that after the business reorganization, the firm will return to profitability. The company board however, did not recommend the payment of a dividend for the half year period.