Oman Cement Co records 2014 net profit slump
The firm said the decline was mainly due to lower volume of cement sales, lower clinker production and higher volumes of imported clinker
Oman Cement Co’s net profit for the year 2014 declined by 12.8% to OR13.15m ($34m) from OR15.08m ($39m) in the previous year.
The company said the decline was mainly due to lower volume of cement sales, lower clinker production and higher volumes of imported clinker.
Oman Cement imported higher volumes of clinker to bridge the temporary shortfall due to one of its kilns being closed for capacity enhancement.
The company said it would consider a joint venture (JV) for setting up a new cement plant after detailed studies.
It said the $39m project for installing an additional cement mill of 150TPH (tonnes per hour) capacity with supporting infrastructure of cement silos and bulk despatches is in progress and is expected to be completed during the fourth quarter of 2015.
Oman Cement achieved sales of 2,078,937MT of cement during 2014 against 2,101,631MT in the previous year, a decrease of 1.1%.
In value terms, total sales dropped 2.05% last year to OR51.35m ($133.4m) from OR52.42m ($136m) in 2013.
“Market demand for cement in Oman remains good due to continued emphasis on infrastructure development. With the company's well-structured pricing policy, we hope that in spite of stiff competition with other cement manufacturers, particularly from neighbouring countries, the company will continue to do well to retain its market share,” a company statement read.
The cement producer said that government's decision to double the price of natural gas, effective January 1, is bound to have a major impact on its performance in the coming years.
“Similarly restrictions on carrying capacity for road transport of materials will also increase the cost of operations. However, we are committed to meet the challenge by directing our efforts towards better cost management.”