Tanga Cement Company Plc Reports 25% Increase in Gross Profit Due to Cost Containment Strategies

Published On: September 4, 2023Company: Tanga Cement Company Plc (SIMBA.tz)
What was the primary factor responsible for the remarkable surge in EBITDA?
The surge in EBITDA was primarily attributed to the intentional implementation of cost containment strategies by Tanga Cement's management team.

Summary

  • The Tanga Cement Public Limited Company and its subsidiary have shown a favourable increase in operational performance for the quarter ended 30 June 2023 despite industry challenges like inadequate electricity and scarcity of USD and EUR in the forex market.
  • The company has adhered to high health and safety standards and is committed to contributing to Tanzania’s growth and development through their quality products.
  • The Group’s growth outlook is tied to the growth in cement demand in Tanzania’s construction industry.
  • The annual headline inflation rate has shown a decrease from 4.7% to 3.6% in Q2 2023.
  • The Group is optimistic about the positive impact of infrastructure development under the Government’s Development Vision 2025 programme and lauds the Government’s initiatives to counteract oil price increases and scarcity of major foreign currencies.
  • In spite of a 5% decline in sales revenue, the company’s gross profit showed an increase of 25% credited to the implementation of cost containment strategies.
  • The Group saw a loss before tax of TZS 2.1 billion in Q2 2023, which is a slight improvement from the loss before tax of TZS 2.4 billion in Q2 2022.
  • There was a significant increase in cash generated from trading activities and net cash flows from operations, attributed to improvements in gross margin and EBITDA.
  • The company did not declare an interim dividend for 2023 to conserve cash resources amidst global economic uncertainties and high fuel prices.
  • The proposed acquisition of a majority stake in Tanga Cement PLC by Scancem International DA from Afrisam Mauritius Investment Holdings Limited was mentioned.
  • The company appreciates its staff and customers for their support and is optimistic about growth opportunities in the East African construction market.

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About Tanga Cement Company Plc (SIMBA.tz)

Tanga Cement Company Plc manufactures, distributes and sells cement and clinker products to the building, construction, roadworks and mining segment in Tanzania. The company produces Portland limestone cement with limestone extenders used for structural and non-structural cast constructions; reinforced concrete for civil and industrial works; and fillings, coatings, screeds and mortars as well as concrete for mining infrastructure and shafts. The company markets its cement products under the Simba Cement Brand. Tanga Cement Company is a subsidiary of AfriSam (Mauritius) Investment Holdings Limited; with production facilities in the city of Tanga in Pongwe and its head office in Dar es Salaam. Tanga Cement Company Plc is listed on the Dar es Salaam Stock Exchange

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