011Economic managers see the higher cement demand in any state is a sign of its growing economy having positive impact on the different industrial units connected with construction sector.
In Pakistan, researcher calculated that cement consumption in October 2017 continued to surge as the monthly dispatches of the commodity register high mark of 4.222 million tons, which is 19.71 percent larger than 3.526 million tons dispatches in the corresponding period last year. The experts also mentioned that the total dispatches of cement in Pakistan stood 14.570 million tons in the first four months of present fiscal year that is 16.53 percent higher than the dispatches of 12.503 million tons during the same months of previous year. Different sources mentioned that the rise in cement dispatches is despite the fact that the exports during the period under review declined by 16.16 percent.
Much of the surge in dispatches in October 2017 was because of the high domestic demand as local consumption grew by 25.61 percent from 3.008 million tons in October 2016 to 3.779 million tons last month. However, the trend of decline in exports continued which went down 14.55 percent in October 2017 as against to same month previous year, from 0.518 million tons to 0.443 million tons. All Pakistan Cement Manufacturers Association (APCMA) revealed that the cement demand in the North Zone stayed surprisingly very high as the consumption in the region reached at 3.148 million tons during October 2017. In October 2016 the local cement consumption in the North Zone was 2.489 million tons. The association also said cement demand in the Southern region of Pakistan also grew from 0.519 million tons in October 2016 to 0.631 million tons in October 2017. However, the association said that higher cement consumption does not mean that 11the economic planners ignore the genuine challenges faced by this sector.
11In Pakistan, Lucky Cement Limited is performing in stiff regulatory environment and is only surviving because it has upgraded its technology that has provided it the strength to take any challenge head on. Lucky Cement continues to remain optimistic about volumetric growth for the upcoming years. Domestic sales are predicted to stay strong on the back of private and public sector construction projects also mega infrastructure development projects mainly CPEC initiative.
The experts of the company mentioned in the company’s financial report that Lucky Cement’s strong and debt-free financial presentation and free cash flow generating ability are expected to support investments in projects and avenues, which can bring in further operational efficiencies and enhance shareholders’ value. On the other hand, the management has announced financial results for the first quarter ended September 30, 2017. During the first quarter of 2017-18 under review, the company 11attained an overall net sales revenue growth of 6.0 percent as against to the corresponding period last year. The financial experts of the company mentioned that this was largely attributable to boost in sales volumes. During the first quarter of 2017-18, per ton cost of sales of Lucky Cement grew by 28.3 percent as against to the corresponding period last year. The rise was chiefly attributable to grow in coal and other fuel prices. The company attained profit-before-tax (PBT) of Rs3,700.8 million during the quarter under review as against to Rs4,651.1 million registered last year. Whereas, profit-after-tax (PAT) of Rs 3,017.3 million was attained during the period under review as against to Rs 3,237.2 million recorded during the corresponding period last year. The earnings per share (EPS) of the company for the quarter closed September 30, 2017 was Rs9.33 as against to Rs10.01 registered during the same period last year.
Experts of the company mentioned in the company’s report that Lucky Cement has already executed EPC contract and alsofinalized the draft of the Power Purchase Agreement, Implementation Agreement and Coal Supply Agreement. With the anticipated resolution of the matter with respect to restrictive [timebound] use of imported coal in the second quarter of FY2017-18, the company shall swiftly move towards financial close. The revised target for financial close and commercial operation is June 2018 and June 2021, respectively. It is also mentioned that capacity expansion of the first 50 percent [i.e. 0.4355 million tons] in Iraq grinding unit is predicted to come online by the end of October 2017, whereas, the remaining 50 percent of the capacity expansion [i.e. 0.4355 million tons] is predicted to come online by the end this month.