Tanzania Portland Cement reveal dip in H1 2015 profits

Tanzania Portland Cement, which trades as Twiga on the Dar es Salaam Stock Exchange, posted a H1 2015 net profit of TZS22.17 billion (US$10.4 million)- down from TZS27.14 billion ($12.5 million) - recorded during the corresponding period last year.

Revenue of the 674 HeidelbergCement subsidiary, the largest cement producing firm in Tanzania, in the first half went up by 18% to TZS135.74 billion ($62.54 million) as sales increased but cost of sales chewed up revenue by almost two-third.

Twiga chairman Jeanmarc Junon said apart from increased cost of sales, insurance proceeds also had toll on the profitability.

"The operating profit for the period was impacted by increased production costs especially on raw materials and fuel due to depreciation of shilling.

"Twenty per cent decrease in operating profit is mainly due to insurance proceeds of (TZS) 5bn in 2014." The chairman said competition in the cement market is expected to further increase in the second half of this year: "nevertheless, TPCC enjoys a good market position," said Junon.

The profit slow down impacted negatively on earnings per share to dip by 18% to close the first half at 123/22 a share.