April 15, 2019 / 1:57 PM / 3 days ago

Kenya's Bamburi Cement's profit plunges 83 pct in 2018

NAIROBI, April 15 (Reuters) - Kenya’s Bamburi Cement , the country’s largest cement company, reported an 83 percent drop in pretax profit for last year, hurt by shrinking sales in its home market and higher debt provisions at its Uganda business.

The company, which is controlled by Lafarge Holcim, said on Monday that profit fell to 680 million shillings ($6.74 million) from 4.12 billion a year earlier.

However, it boosted its total dividend for the year to 5.10 shillings per share from 4.00 shillings a year earlier and higher than its earnings per share.

Bamburi blamed higher costs, including for energy, and higher provisioning for receivables in Uganda. Cement volumes in Kenya grew by 9 percent despite a 5 percent drop in the overall cement market, suggesting it had cut prices to boost market share, analysts said.

“Increased competitive pressure fuelled by a growing gap between installed cement grinding capacity and the shrinking market has played a key role in the market dynamics,” Bamburi said in a statement.

Another firm, ARM Cement, fell into administration last year under a mountain of debt, having failed to secure a deep-pocketed suitor to rescue it. ($1 = 100.9000 Kenyan shillings) (Reporting by Duncan Miriri; Editing by Kirsten Donovan)

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