Caribbean Cement plans two-year maintenance programme
Weighed down by a $3-billion energy bill and restructuring charges, Caribbean Cement Company Limited's bottom line shrank last year, despite record revenues.
The cement maker performed poorly in the fourth quarter, when it racked up more than $660 million of net losses, according to Financial Gleaner estimates. Those results were the outcome of $875 million of restructuring charges that the company said it booked in the period.
As a result of those charges, plus an eightfold increase in Caribbean Cement's tax bill, its annual profit shrank from $1.3 billion to $1.15 billion, or from $1.53 per share to $1.35 per share.
In its newly released audited results, Caribbean Cement directors said the restructurings of manpower and inventory have positioned the company to focus on profitability going forward.
"After defining 2017 as a year of transition, the board of directors is now focused on consolidation of ongoing initiatives in health and safety, and roll-out of a 2-year maintenance plan to ensure improved production performance and cement output," said the statement signed by Chairman Parris Lyew-Ayee and General Manager Peter Donkersloot.
The maintenance plan continues a programme of reinvestment in the Rockfort, Kingston plant now ultimately owned by Cemex of Mexico.
Last year, the Jamaican cement maker pumped capex of more than $2.2 billion into the plant, or half-billion dollars more than the $1.7 billion spent in 2016.
Caribbean Cement is yet to report on its volume sales in 2017, but its domestic and export markets together turned over $16.5 billion of revenue, up from $15.78 billion in 2016, when volume sales of cement climbed above 904,000 tonnes and clinker exports dropped under 40,000 tonnes.
In terms of output, Caribbean Cement produced 911,325 tonnes of cement in 2016, the closest it came to its long-standing goal that predated Cemex's indirect takeover, to deliver one million tonnes under a major plant project a decade ago.
Cemex gained control of Caribbean Cement when it took over Trinidad Cement Limited in 2016. That year, the Jamaican operation completed an improvement programme that grew daily output from 2,000 tonnes to 2,800 tonnes in August 2016, according to its annual report. Work on a coal mill also kicked off that year and was scheduled to wrap up towards the end of last year.