- The first half of 2022 was characterised by monetary policy fragility which led to aggressive inflation and depreciation of the foreign currency exchange rate.
- Annual inflation closed in 2022 at 243.7%, up from 60.7% in the previous year.
- The influx of cheap imported cement seriously threatened the domestic industry.
- The Company resumed production of cement at both mills in mid-February 2022 and successfully commissioned the Vertical Cement Mill (VCM).
- Sales volumes decreased by 19% in line with the trend in production volumes.
- The Company reported a loss before tax of ZWL 17.3 billion compared to a profit before tax of ZWL 1.7 billion in 2021.
- The Dry Mortars business performance was adversely affected by raw material shortages.
- The Company had net long-term borrowings of ZWL 9.2 billion for the year under review (2021: ZWL 2.3 billion).
- The Company implemented the Lafarge Holcim 2022 Vision – Building for Growth.
- This focuses on the key strategic pillars of Winning at the Customer, Creating Sustainable Industrial Performance, Building Winning Teams and Restoring Profitability.
Health Safety & Environment
- Health, safety and environmental issues remain at the core of the Company’s values.
- The Company has a zero-tolerance attitude towards negligence in the workplace.
- It is pleasing to report that no fatalities or serious injuries were recorded and the Company did not incur any environmental penalties.
Inflation-Adjusted Financial Performance
- Inflation-adjusted revenues were constant at ZWL 24.4 billion (2021: 24.6 billion).
- Cement production volumes decreased by 15%.
- Total expenses fell by 7.6%.
- The Company managed to maintain tight control over its operating expenditure.
- Exchange rate losses increased by 490%.
- The business concluded implementing the previously announced USD 25 million capital expansion program.
- This included the commissioning of the VCM in 2022 and the completion of the automated Dry Mortars plant in 2021.
Board & Management
- Mr. Geoffrey Ndugwa resigned as Chief Executive Officer and a member of the Board of Directors with effect from 1 December 2022.
- Mrs. Gloria Eva Zvaravanhu and Mr. Shepherd Shonhiwa resigned as Independent Non-Executive Directors with effect from 19 December 2022.
- Mr. John William Stull resigned as a Non-Executive Director effective 1 December 2022.
- Due to the prevailing uncertainties in the economic environment and the desire to maintain adequate working capital, the Directors have not declared a dividend.
- The need to regulate cement imports, bring inflation under control, address the shortages of electricity supply and improve the state of the global economy are likely to be dominant factors in the Company’s performance for the year 2023.
- The Directors are satisfied with the positive production, sales and profitability recovery trend.
- The change of the Company’s name from Lafarge Cement Zimbabwe Limited to Khayah Cement Limited is scheduled for 7 July, 2023.
About Lafarge Cement Zimbabwe (LACZ.zw)
Lafarge Cement Zimbabwe manufactures and distributes cement and allied products for the building industry. Formerly known as Circle Cement, the company is a subsidiary of the Lafarge Group. The cement product range includes Portland composite cement which is the cement used in beams, foundations and load-bearing structures; Supaset, used by concrete brick makers and homebuilders; Masonry cement, used for general construction work such as screed flooring, brick and mortar and plastering mortar. Lafarge Cement Zimbabwe also sells a range of allied products which include washed sand, 6-mm stones, 20-millitre stones and crusher run. Specialised products include Agricultural lime, Colorbrite and Snolime, pre-sanded Cemwash and Impermo. Lafarge Cement Zimbabwe is listed on the Zimbabwe Stock Exchange
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