Infrastructure is an important tool for development of any country because it attracts the foreigners to invest in the country. It is also a fact that a nation cannot survive or achieve the economic targets unless it evolves a large scale infrastructure network and for which cement is always considered as a barometer of progress in developing state and is rightly taken as a significant economic activity indicator.
Bestway Cement Limited is the second largest cement producer of Pakistan and a joint owner of Pakistan’s third largest bank, United Bank Limited. Bestway Cement is part of the Bestway Group of UK. In just over decade the company’s cement production capacity is set to greater than quadruple to over 6.0 million tons per annum.In Pakistan, cement industry is progressing at a very fast pace. At the time of independence, the cement industry experts mentioned that there were only 4 cement plants in Pakistan with an annual capacity of 300,000 metric tons and today the industry has increased to 29 units with yearly capacity of 45 million tons.
|BESTWAY CEMENT: PRODUCTION AND SALES (Tons)|
|Details||Quarter ended 30 September 2017||Quarter ended 30 September 2016||Increase/ (Decrease)||Percentage|
|Cement and Xtreme Bond sales||1,883,250||1,672,019||211,231||13%|
|Source: Bestway Cement|
Presently, the company proclaimed financial information for the quarter closed 30 September 2017. Bestway’s local dispatches rose by 21 percent, while exports fell by 22 percent resulting in a rise in total cement dispatches of 13 percent during the period under review. Furthermore, the company’s financial adepts mentioned in the financial statement of the company that Bestway’s sale of clinker accounted for greater than 63 percent of clinker sales by the industry as a whole. Despite fierce competition, the company fruitfully retained its share of the market in the North Zone and its position as the largest cement producer and the market leader in Pakistan.
Financial experts also mentioned that Bestway Cement registered gross turnover of Rs18.7 billion in the quarter closed 30 September 2017 as against to Rs15.8 billion last year. In addition, revenue for the period reached at Rs12.9 billion as compared to Rs11.6 billion, a rise of 11 percent. The rise in sales is attributed to increasing local demand and clinker sales during the quarter under review, partially dampened by falling export volumes and retention prices. It is also mentioned that the gross profit for the quarter fell by 9 percent to Rs4.9 billion. Despite higher volumetric sales in the quarter, gross profit was adversely impacted by a fall in net retentions and raised coal rates. Financial charges stood at Rs0.2 billion for the quarter closed as compared to Rs0.3 billion for the same period previous year, driven by prepayments of long term financing and capitalization of borrowing costs. Profit-before-tax (PBT) amounted to Rs4.0 billion, 7.2 percent lower as against to Rs4.4 billion for the quarter closed 30 September 2016. Profit-after-tax (PAT) also fell by 6 percent from Rs3.2 billion to Rs3.0 billion. The company’s earnings per share (EPS) for the quarter closed 30 September 2017 were recorded at Rs5.03 as compared to Rs5.37 from the same period previous year. Work on the brown field cement plant with a capacity of 6,000 tons of clinker per day along with WHRPP of 9 MWs capacity at Farooqia site is on-going as scheduled. Bestway being an established brand in both Afghanistan and India, will continue to maintain its focus in these markets. The company is cognizant of the difficulties that lie ahead and will continue to maximize opportunities and work towards further growth and superior returns in the ensuing years.