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Bangladesh expects a 15% growth in cement exports in FY22-23

Bangladesh has set an export target for the cement industry at US$11m during the 12 months of the ongoing financial year, ending 31 June 2023, compared to US$9.57m earned in FY21-22. This translates to expected growth of 15 percent YoY, according to the Bangladesh Export Promotion Bureau (EPB) data.

Meanwhile, the first month of FY22-23, ie July 2022, started with bringing home US$0.72m of earnings on account of cement exports, up by 94.6 percent over the same month last year. The figure also includes a minor amount of salt, stone, and related products, says EPB data.

More than a dozen companies export cement to India, Myanmar, Nepal, Maldives, and Sri Lanka. Furthermore, local media says that Bangladesh Cement Manufactures Association (BCMA) sent a letter to the commerce ministry asking for a 10 percent cash incentive for exporting key construction materials to increase the current export volume threefold.

The volume of cement export was 0.25Mt in the 2021 calendar year. The majority was exported to the northeastern states of neighbouring India, cites the letter. Seventy-six cement companies are registered with the government, but only 42 large-, medium- and small-scale companies are currently in operation. Of them, seven have stock market listings, according to the association.

Currently, all the 42 plants have a production capacity of ~58Mta against the demand of ~31Mta. The cement industry is dominated by only 10 companies, including two multinationals, holding around 75 per cent of the total market share.

Lucky Cement announces consolidated earnings of Rs 36.42 bn for FY22

On a consolidated basis, Lucky Cement Limited, once again, reported its highest ever profit after tax of PKR 36.42 billion for the year ended June 30, 2022, of which PKR 6.93 billion is attributable to the non-controlling interests.

This translates into earnings per share (EPS) of PKR 91.22 share as compared to PKR 70.69 share reported last year, according to a press release issued here on Friday.

On a consolidated basis, the company achieved 60% higher net turnover of PKR 331.5 billion as compared to last year’s turnover of PKR 207.2 billion.

The consolidated Net Profit of the Company remained PKR 36.4 billion out of which PKR 29.5 billion was attributable to the owners of the holding company, compared to PKR 28.2 billion and PKR 22.9 billion, respectively for the prior year.

This translates into an EPS of PKR 91.22 during the fiscal year ended June 30, 2022 as compared to PKR 70.69 during last year, representing a growth of 29%.

The exceptional growth in revenue, despite economic challenges is owing to robust performance across all businesses of the group and is an affirmation of the successful execution of the Group’s diversification strategy.

On a standalone basis, the company’s overall sales volumes declined by 8.9% to reach 9.1 million tons during the year ended June 30, 2022 in comparison to 10 million tons last year.

Local sales volume dropped by 3.6% to reach 7.3 million tons in the current year compared to 7.6 million tons last year.

While the export sales volume declined substantially by 25% to 1.8 million tons during the year compared to 2.4 million tons during last year due to non-viability in terms of pricing on the back of persistent high coal prices in the international market coupled with increased shipping freights.

Despite the reduction in volumes in both domestic and export sales, the profitability of the local cement operations improved marginally because of enhanced operational efficiencies, including better management of sales and distribution costs, which decreased as a percentage of sales.

The Company achieved a major milestone when its wholly owned subsidiary, Lucky Electric Power Company Limited (LEPCL), achieved the Commercial Operations Date (COD) on March 21, 2022 of the 660 MW coal-fired power plant set up at Port Bin Qasim, Karachi.

This milestone will play a key role in increasing the energy security and prosperity of Pakistan.

It will also go on to reduce the cost of electricity and reliance on imported fuel in the long run after the completion of Phase III of SECMC in June 2023.

The power generated from the plant is being fed into the national grid in line with a power purchase agreement signed with the Government. In another major development, the Company’s subsidiary, Lucky Motor Corporation started assembling Samsung mobile phones in Pakistan in December, 2021.Lucky Cement remains committed towards making a real contribution to the society and the communities in which it operates.

The Company extended its merit-based support to deserving and less privileged students in Pakistan and abroad.

The Company also continued to donate generously towards health-based initiatives by supporting various welfare organizations. In support of the UN Sustainability Development Goals, the Company has initiated and promoted various sustainable projects to support the United Nations’ 2030 Agenda.Regarding the future outlook, the Company has reported that it expects fiscal year 2023 to be challenging for Pakistan’s economy, especially due to the high Current Account Deficit, which stood at $17.4 Billion for FY 2022 versus $2.8 Billion for FY 2021. The ongoing political instability has deteriorated the economic position of the Country and resumption of foreign exchange inflows from the IMF program has faced serious delays. The IMF staff level agreement has now been signed and as per Government statements majority of conditions have been met and it expects the program to resume post approval from the IMF Board towards end of August 2022.

The resumption of the IMF program will not only reduce uncertainty but also open avenues for borrowing from other sources, which could help stabilize the foreign reserves and the domestic economic situation.

Apart from this, certainty in the political landscape of the country is needed so that long term and sustainable measures are taken for enhancing the exports and ultimately reducing the current account deficit of Pakistan.

Adani Group to acquire Holcim India

India: Holcim has agreed to sell its Indian business to industry, energy and ports conglomerate Adani Group for US$6.37bn. The assets consist of a 63% stake in Ambuja Cement, which in turn owns 50% of ACC, and a 4.5% direct stake in ACC.

ACC and Ambuja Cement employ 10,700 people and operate 31 cement plants in India. The deal will make Adani Group India’s second-largest cement producer.

Chair Gautam Adani said “With Holcim’s global leadership in sustainability, we are acquiring some of the most efficient building materials operations in India, powered with clean technologies like heat recovery systems. We recognise that Ambuja and ACC operations are energy intensive and therefore, when combined with our renewable power generation capabilities, we gain a big head start in the decarbonisation journey that is a must for Indian industry.”

Holcim says that its focus is now on expanding its solutions and products business. Reuters News has reported that the group plans to put the proceeds of the assets’ sale towards lower-carbon acquisitions. Its Indian operations contributed 26% of group CO2 emissions.

CEO Jan Jenisch said “We will always make cement, but we will decarbonise cement.” He added “We are happy to build up other segments like building solutions and products

Flying Cement gets long term mining lease for limestone

Flying Cement Company Limited (FLYING) has been granted a long-term mining lease by the Directorate General of Mines & Minerals (Punjab) for limestone over an additional area of 1,765 acres of land situated near to factory site, Dhok Meharwal in District Khushab, Punjab, the company’s filing on PSX said today.

This will add remarkable value to the company’s vision in the implementation plan of achieving constant future growth.

Accordingly, the company would be able to implement its business growth plan by further expanding its operation in the near future which will result in better profitability and add significant value to the shareholders’ equity.

Yanpai to Add Four Needlepunch Nonwovens Lines

Yanpai Filtration Technology Co., Ltd., a Chinese filtration media manufacturer, will expand needle punch capacity at its site in Tiantai, China through the investment of four Andritz lines. The new lines will begin starting up in the third quarter of 2022 and should be complete in the third quarter 2023.

Andriz will deliver customized needlepunch lines for the production of high-quality needlepunch filter felts. The lines will enable Yanpai to achieve state-of-the-art technical characteristics in terms of product quality and line performance. The drylaid web-forming equipment (cards and cross lappers) will be manufactured at the Andritz Wuxi premises, including 8 PRO 25-80 access profile cross lappers for controlled web weight evenness. The 16 eXcelle needlelooms will be supplied by ANDRITZ Asselin-Thibeau in France.

Yanpai is one of the leading Chinese producers of nonwoven filters for dust and air treatment and for woven filter fabrics used in solid/liquid separation. Established in 1990, Yanpai was at the forefront in the development of new industrial filtration fabrics. Today, YANPAI is a company with facilities in China and the USA.

Power Cement reports 82% YoY rise in 1H net profit

Power Cement posted a 43.6 percent increase in revenues to PKR5162m (US$29.1m) in the quarter ended 31 December 2021 (2QFY21-22), up from PKR3595m m in the 2QFY20-21.

Operating profit saw a 37.3 percent hike to PKR961m in the 2QFY21-22 from PKR700m in the equivalent period of the previous year. Net profit advanced 96.7 percent YoY to PKR471m in the 2QFY21-22 from PKR239.4m.

Half-year results
In the half-year ended 31 December 2021, Power Cement saw its revenues increase by 35.7 percent to PKR9276m from PKR6835m in the 1HFY20-21. Operating profit reached PKR1377m, up 23.2 percent from PKR1117m in the equivalent period of the previous year while net profit advanced 81.8 percent to PKR280m from PKR154m over the same period.