East African Portland Cement trims annual loss to Ksh.2.8 billion
The East African Portland Cement Company (EAPCC) has announced an 18 per cent truncated loss to Ksh.2.8 billion in the year closing June 30.
The narrower loss from Ksh.3.4 billion last year is largely attributable to fair value gains on its investment property in the period whose valuation rose by Ksh.1.1 billion during the year.
The gain reversed a Ksh.233.2 million property valuation loss recorded previously.
Further, the cement manufacturer trimmed its administration and selling expenses to a flat 2.5 billion on the back of company wide workforce restructure which saw the board declare all jobs redundant in August 2019.
The company expects further reductions in the general expenses as it moves to complete its staff restructure exercise.
EAPCC has nevertheless struggled in its core businesses with revenue for the year declining by 13 percent owing to increased competition and downward pressure on the retail prices for cement.
Moreover, the company’s continuity remains in doubt as the gap between its current assets and current liabilities widened.
The gap for instanced widened to Ksh.13.8 billion from Ksh.10.2 billion last year as the short-term liabilities increased by 19 per cent to Ksh.16.4 billion while current assets dwindled to Ksh.2.4 billion from Ksh.3.6 billion last year.
The company has been betting on the sale of its bulk land holdings to unlock the much needed working capital to clear off debt arrears accruing to institutions including KCB and the Japan International Corporation Agency (JICA).
The plan has however recently run into headwinds with the government laying ownership claims to the land parcels located in Athi River.