Lafarge Cement Zimbabwe achieved an earnings per share of $0,03 weighed down by a once-off tax payment.
Despite recording a surge in revenues during the financial year ending December 2010 on the back of an improved economic performance, the company’s profit margins remained flat.
Lafarge paid a $1,05 million tax expense which reduced profit to $2,68 million from $2,69 million in 2009.
Gross revenue rose 47% from $28,3 million to $41,7 million buoyed by increased domestic cement sales that grew 54,7%.
During the year under review, portfolio equity investments were disposed for $1,3 million, which was utilised to settle foreign creditors.
“Profit attributable to shareholders remained largely the same despite increased sales revenues, due to a tax expense incurred for the year, as opposed to a tax credit in 2009,” Lafarge Cement chairman Muchadeyi Masunda said.
Operating margins improved from 6,2% in 2009 to 10% in 2010. Export clinker volumes were 55,5% lower than in 2009 as a result of challenges from the refurbishment of the Tete bridge in Mozambique, one of the company’s main export market.
“The Zimbabwe economy is expected to grow with increased activity in mining constriction and infrastructural development. Prospects for further improvements in domestic demand for cement remain strong,” said Masunda.
The company said despite working capital constraints, construction activities improved as work resumed on some suspended projects and new projects came on stream.
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