Price hike of raw materials hits cement companies' EPS

Mohammad Mufazzal | Published: December 02, 2018 10:32:35 | Updated: December 04, 2018 12:42:50


Picture used for illustrative purpose

Price hike of raw materials has affected the cement manufacturers of the country, market insiders said.

Because of increased production cost, the earning of most of the listed cement companies declined for 2018 compared to previous year.

Of five local listed companies, the EPS (earnings per share) of four entities declined for the year ended on June 30, 2018.

The companies whose EPS declined are Aramit Cement, Confidence Cement, MI Cement and Premier Cement.

EPS of Meghna Cement, however, rose marginally.

The dividends recommended by some companies have declined marginally for the last fiscal year. One company has recommended no dividend for the second consecutive year.

Masud Khan, the chief executive officer of MI Cement, said the cost of all raw materials including the clinkers rose abnormally.

"The devaluation of currency against the dollar and the hike of financial costs including transport cost have also left a negative impact on our business," Khan said.

He said the manufactures should work to make the financial costs rational.

"Otherwise, the cement companies may witness further decline in profit margins," Khan added.

The loss of Aramit Cement rose for 2018 from the loss incurred in previous year.

The company has reported a loss of Tk 4.56 for the year ended on June 30, 2018 as against the loss of Tk 2.97 for the same period of the previous year.

Its NAV per share of Tk. 6.00 was for the year ended on June 30, 2018 as against Tk. (2.97), a negative value, observed in previous year.

The Confidence Cement has reported EPS of Tk. 6.93 for the year ended on June 30, 2018 as against Tk. 9.23 reported in previous year.

Its NAV per share was Tk. 76.00 in 2018 as against Tk. 84.10 calculated in previous year. The EPS was Tk. 1.81 for July-September, 2018 as against Tk. 1.49 for July-September, 2017.

Meghna Cement has reported EPS of Tk. 3.62 and NAV per share of Tk. 38.33 for the year ended on June 30, 2018 as against Tk. 2.91 and Tk. 36.71 respectively for the same period of the previous year.

The EPS of MI Cement declined to Tk 2.13 for 2018 from Tk 4.45 calculated in previous year. The company has reported NAV per share of Tk. 47.98 and NOCFPS of Tk. 1.36 for the year ended on June 30, 2018 as against Tk. 47.80 and Tk. 1.73 respectively for the same period of the previous year.

The company's EPS, however, has remained unchanged for July-September, 2018 compared to same period of previous year. It has reported EPS of Tk. 0.47 for July-September 2018.

The Premier Cement has reported consolidated EPS of Tk. 4.18 for the year ended on June 30, 2018 as against Tk. 5.08 calculated in previous year.

The company's consolidated NAV per share of Tk. 43.13 and consolidated NOCFPS of Tk. 6.88 for the year ended on June 30, 2018 as against Tk. 40.95 (restated) and (cont.) Tk. 4.21 (restated) respectively for the same period of the previous year.

The consolidated EPS was Tk. 1.02 for July-September, 2018 as against Tk. 0.41 for July-September, 2017.

The financial year of two multinational cement companies---Heidelberg Cement Bangladesh and LafargeHolcim--- ends in December. That's why these companies are yet to recommend dividend for the ongoing year.

mufazzal.fe@gmail.com

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