Bamburi Cement has issued a profit warning stating that it expects a drop of more than 25 per cent in net earnings due to a reduction in demand in the cement market.
In a statement, the firm said the expected lower profits are a result of reduced cement demand amidst higher operating costs.
“The board wishes to inform shareholders of the company, potential investors and the general public that based on the forecasted 2022 financial performance of the company currently at the Boards disposal, the projected net earnings for the financial year 2022 will be lower than the net earnings reported in the financial year 2021 by at least 25 per cent,” the firm said in a statement.
“Significant inflation of fuel prices, logistics costs and imported clinker prices in both Kenya and Uganda adversely impacted the operating profit. This was also adversely impacted by forex losses of the Kenya Shilling and Uganda Shilling against other major currencies.
Listed firms are required by the Capital Markets Authority to notify investors and the public should they expect their full-year net profit to decline by at least 25 per cent.
The cement manufacturing company made a net profit of Sh1.38 billion in 2021 up from Sh1.1 billion in the last year.
The firm has however reassured potential investors and shareholders of its confidence in an improvement in its performance in the future.
The board will however like to reassure shareholders, potential investors and the general public that it is confident that the company will register improved performance and profitability in the future, driven by the expected recovery of the economy and an improvement in input costs,” the firm added.
