Oman Cement net profit declines 39 on gas price
Date
10/27/2015 2:48:11 PM
(MENAFN- Muscat Daily) Muscat-
Oman Cement Co reported a 38.7 per cent fall in net
profit for the nine-month period ended September 30 2015 mainly due to the increase in
gas prices from the beginning of this year.
The cement producer's net profit dropped to RO6.99mn from RO11.41mn a year earlier. Sales for the nine-month period stood at RO37.7mn against RO37.39mn during the corresponding period of the previous year for an increase of just 0.8 per cent. In volume terms Oman Cement achieved sales of 1.49mn metric tonnes (MT) of cement during the first nine months of 2015 against 1.5mn MT of cement in the same period of 2014. The decrease in profit is mainly due to higher energy costs incurred by the company as a result of the doubling of gas prices. The company had earlier in the year expected direct expenditure on this account to go up by an estimated RO6.63mn in 2015. 'The decline in market value of the company's investments also had an adverse impact on performance. In addition to that the stoppage of the kiln for a period longer than planned also resulted in the decline in profit' Oman Cement said in its chairman's report released on Tuesday. 'We have however continued with our efforts to minimise the impact by better cost management wherever possible' it said. With the company's well-structured pricing policy Oman Cement said it hopes that even with the continued competition the company will continue to do well in retaining its market share. Oman Cement said the project for construction of an additional cement mill of 150-tonnes-per-hour capacity with supporting infrastructure of silos and bulk dispatches is in progress and trial production from the mill is expected to commence by the end of the fourth quarter of 2015. Oman Cement has also awarded a US$11.3mn contract for upgradation of pollution control equipment at its line two to FLSmidth.