LCK/ANNOUNCE/2019-20 April 23, 2020
The General Manager Pakistan Stock Exchange Limited Karachi | The Deputy Chief Securities & Exchange Commission of Pakistan Islamabad | The London Stock Exchange 10 Paternoster Square, London |
Dear Sir(s),
FINANCIAL RESULTS FOR THE 3RD QUARTER ENDED MARCH 31, 2020
This is to inform you that the Board of Directors of our Company in their Meeting held on Thursday, April 23, 2020 at 4:30 p.m., at 6-A, Muhammad Ali Housing Society, A. Aziz Hashim Tabba Street, Karachi-75350 recommended the following:
(I) Cash Dividend Nil
(ii) Bonus Issue Nil
(iii) Right Issue Nil
(iv) Interim Dividend Nil
The financial results of the Company consisting of Statements of Financial Position, Statements of Profit and Loss and Other Comprehensive Income and Directors' Report are annexed.
The 3rd quarterly report of the Company for the period ended March 31, 2020 will also be transmitted through PUCARS separately, within the specified time.
Yours truly
for LUCKY CEMENT LIMITED
Atif Kaludi
CFO/Director Finance
LUCKY CEMENT LIMITED |
| |||||||||
Unconsolidated Condensed Interim Statement of Financial Position |
| |||||||||
As at March 31, 2020 |
| |||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| (Un-audited) |
|
|
| (Audited) |
|
|
|
|
|
| March 31, |
|
|
| June 30, |
|
|
|
|
|
| 2020 |
|
|
| 2019 |
|
|
|
|
|
| (PKR in'000') |
| ||||
ASSETS |
|
|
|
|
|
|
|
|
| |
NON-CURRENT ASSETS |
|
|
|
|
|
|
| |||
| Fixed assets |
|
|
|
|
|
|
| ||
| Property, plant and equipment |
| 60,856,953 |
|
|
| 57,276,184 |
| ||
| Intangible assets |
| 14,205 |
|
|
| 18,152 |
| ||
|
|
|
|
| 60,871,158 |
|
|
| 57,294,336 |
|
|
|
|
|
|
|
|
|
|
|
|
| Long-term investments |
| 44,044,485 |
|
|
| 34,313,588 |
| ||
| Long-term loans and advances |
| 91,213 |
|
|
| 99,316 |
| ||
| Long-term deposits |
| 3,175 |
|
|
| 3,175 |
| ||
|
|
|
|
| 105,010,031 |
|
|
| 91,710,415 |
|
CURRENT ASSETS |
|
|
|
|
|
|
| |||
| Stores and spares |
| 7,598,535 |
|
|
| 6,809,724 |
| ||
| Stock-in-trade |
| 2,802,882 |
|
|
| 4,253,020 |
| ||
| Trade debts |
| 2,613,238 |
|
|
| 2,058,719 |
| ||
| Loans and advances |
| 523,370 |
|
|
| 686,525 |
| ||
| Trade deposits and short term prepayments |
| 81,672 |
|
|
| 74,223 |
| ||
| Accrued return |
| 105,409 |
|
|
| 113,869 |
| ||
| Other receivables |
| 2,547,157 |
|
|
| 2,130,907 |
| ||
| Tax refunds due from the Government |
| 538,812 |
|
|
| 538,812 |
| ||
| Short term investment |
| 2,917,749 |
|
|
| 1,055,754 |
| ||
| Cash and bank balances |
| 11,803,046 |
|
|
| 15,657,246 |
| ||
|
|
|
|
| 31,531,870 |
|
|
| 33,378,799 |
|
|
|
|
|
|
|
|
|
|
|
|
TOTAL ASSETS |
| 136,541,901 |
|
|
| 125,089,214 |
| |||
|
|
|
|
|
|
|
|
|
|
|
EQUITY AND LIABILITIES |
|
|
|
|
|
|
| |||
SHARE CAPITAL AND RESERVES |
|
|
|
|
|
|
| |||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Share Capital |
|
| 3,233,750 |
|
|
| 3,233,750 |
| ||
Reserves |
|
|
| 95,369,371 |
|
|
| 91,084,667 |
| |
|
|
|
|
| 98,603,121 |
|
|
| 94,318,417 |
|
NON-CURRENT LIABILITIES |
|
|
|
|
|
|
| |||
|
|
|
|
|
|
|
|
|
|
|
| Long-term deposits |
| 230,597 |
|
|
| 90,264 |
| ||
| Deferred liabilities |
| 7,131,996 |
|
|
| 7,102,483 |
| ||
|
|
|
|
| 7,362,593 |
|
|
| 7,192,747 |
|
CURRENT LIABILITIES |
|
|
|
|
|
|
| |||
| Trade and other payables |
| 21,170,544 |
|
|
| 19,195,617 |
| ||
| Short term borrowings |
| 7,846,639 |
|
|
| 2,900,000 |
| ||
| Unclaimed dividend |
| 55,989 |
|
|
| 53,953 |
| ||
| Unpaid dividend |
| 23,706 |
|
|
| 91,119 |
| ||
| Taxation - net |
| 1,479,309 |
|
|
| 1,337,361 |
| ||
|
|
|
|
| 30,576,187 |
|
|
| 23,578,050 |
|
|
|
|
|
| 37,938,780 |
|
|
| 30,770,797 |
|
|
|
|
|
|
|
|
|
|
|
|
TOTAL EQUITY AND LIABILITIES |
| 136,541,901 |
|
|
| 125,089,214 |
|
LUCKY CEMENT LIMITED | |||||||||||
Unconsolidated Condensed Interim Statement of Profit or Loss and Other Comprehensive Income | |||||||||||
For the nine months ended March 31, 2020 (Un-audited) | |||||||||||
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|
|
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| Nine Months Ended |
| Quarter Ended | ||||
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|
|
| March 31, |
| March 31, |
| March 31, |
| March 31, |
|
|
|
|
| 2020 |
| 2019 |
| 2020 |
| 2019 |
|
|
|
|
| (PKR in'000') |
| (PKR in '000') | ||||
|
|
|
|
|
|
|
|
|
|
|
|
Gross sales |
|
| 47,947,798 |
| 52,314,992 |
| 16,852,237 |
| 17,429,651 | ||
|
|
|
|
|
|
|
|
| |||
Less: | Sales tax and federal excise duty |
| 14,688,143 |
| 14,061,754 |
| 5,327,336 |
| 4,577,359 | ||
| Rebates, incentive and commission |
| 811,609 |
| 732,154 |
| 288,235 |
| 286,283 | ||
|
|
|
|
| 15,499,752 |
| 14,793,908 |
| 5,615,571 |
| 4,863,642 |
|
|
|
|
|
|
|
|
|
|
|
|
Net sales |
| 32,448,046 |
| 37,521,084 |
| 11,236,666 |
| 12,566,009 | |||
Cost of sales |
| (27,921,847) |
| (26,261,232) |
| (9,934,705) |
| (8,730,172) | |||
Gross profit |
| 4,526,199 |
| 11,259,852 |
| 1,301,961 |
| 3,835,837 | |||
Distribution cost |
| (2,931,117) |
| (2,101,175) |
| (1,036,697) |
| (726,666) | |||
Administrative expenses |
| (922,872) |
| (870,017) |
| (325,544) |
| (312,270) | |||
Finance cost |
| (92,421) |
| (11,671) |
| (44,475) |
| (9,773) | |||
Other expenses |
| (290,758) |
| (875,770) |
| (96,447) |
| (305,168) | |||
Other income |
| 2,989,318 |
| 2,349,194 |
| 1,280,287 |
| 742,623 | |||
Profit before taxation |
| 3,278,349 |
| 9,750,413 |
| 1,079,085 |
| 3,224,583 | |||
Taxation |
|
|
|
|
|
|
|
| |||
| -current |
| (568,205) |
| (2,203,674) |
| (201,522) |
| (770,084) | ||
| -deferred |
| 225,272 |
| 747,199 |
| 121,277 |
| 338,650 | ||
|
| (342,933) |
| (1,456,475) |
| (80,245) |
| (431,434) | |||
|
|
|
|
|
|
|
|
|
|
|
|
Profit after taxation |
| 2,935,416 |
| 8,293,938 |
| 998,840 |
| 2,793,149 | |||
Other comprehensive income: |
|
|
|
|
|
|
|
| |||
Other comprehensive (loss) / income which will not be reclassified to statement of profit or loss in subsequent periods |
|
|
|
|
|
|
|
| |||
|
|
|
|
|
|
|
| ||||
Unrealized (loss) / income on remeasurement of equity instrument at fair value through other comprehensive income | (9,027) |
| (5,912) |
| (8,107) |
| 5,026 | ||||
|
|
| |||||||||
Deferred tax thereon |
| 1,354 |
| 887 |
| 1,216 |
| (753) | |||
|
| (7,673) |
| (5,025) |
| (6,891) |
| 4,273 | |||
Total comprehensive income for the period |
| 2,927,743 |
| 8,288,913 |
| 991,949 |
| 2,797,422 | |||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| (PKR) |
| (PKR) | ||||
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per share - basic and diluted |
| 9.08 |
| 25.65 |
| 3.09 |
| 8.64 |
LUCKY CEMENT LIMITED | ||||||||||
Condensed Interim Consolidated Statement of Financial Position | ||||||||||
As at March 31, 2020 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| (Un-audited) |
|
|
| (Audited) |
|
|
|
|
|
| March 31, |
|
|
| June 30, |
|
|
|
|
|
| 2020 |
|
|
| 2019 |
|
|
|
|
|
| (PKR in '000') |
| ||||
ASSETS |
|
|
|
|
|
|
|
|
| |
NON-CURRENT ASSETS |
|
|
|
|
|
|
| |||
| Fixed assets |
|
|
|
|
|
|
|
| |
| Property, plant and equipment |
| 178,659,389 |
|
|
| 135,475,796 |
| ||
| Intangible assets |
| 7,419,549 |
|
|
| 7,653,720 |
| ||
| Right of use assets |
|
| 216,195 |
|
|
| - |
| |
|
|
|
|
| 186,295,133 |
|
|
| 143,129,516 |
|
|
|
|
|
|
|
|
|
|
|
|
| Long-term investments |
| 22,276,009 |
|
|
| 18,554,210 |
| ||
| Long-term loans and advances |
| 615,517 |
|
|
| 551,354 |
| ||
| Long-term deposits and prepayments |
| 54,473 |
|
|
| 51,076 |
| ||
|
|
|
|
| 209,241,132 |
|
|
| 162,286,156 |
|
CURRENT ASSETS |
|
|
|
|
|
|
|
| ||
| Stores, spares and consumables |
| 9,209,749 |
|
|
| 8,193,401 |
| ||
| Stock-in-trade |
|
| 20,113,865 |
|
|
| 18,299,229 |
| |
| Trade debts |
|
| 6,009,864 |
|
|
| 4,508,468 |
| |
| Loans and advances |
|
| 2,252,453 |
|
|
| 1,997,339 |
| |
| Trade deposits and short-term prepayments |
| 1,580,020 |
|
|
| 2,092,112 |
| ||
| Other receivables |
|
| 7,460,469 |
|
|
| 6,935,242 |
| |
| Tax refunds due from the Government |
| 538,812 |
|
|
| 538,812 |
| ||
| Taxation receivable |
|
| 2,131,056 |
|
|
| 2,687,513 |
| |
| Accrued return |
|
| 114,364 |
|
|
| 156,948 |
| |
| Short term investments |
|
| 2,917,749 |
|
|
| 1,055,754 |
| |
| Cash and bank balances |
| 23,129,582 |
|
|
| 18,270,313 |
| ||
|
|
|
|
| 75,457,983 |
|
|
| 64,735,131 |
|
|
|
|
|
|
|
|
|
|
|
|
TOTAL ASSETS |
|
| 284,699,115 |
|
|
| 227,021,287 |
| ||
|
|
|
|
|
|
|
|
|
|
|
EQUITY AND LIABILITIES |
|
|
|
|
|
|
| |||
SHARE CAPITAL AND RESERVES |
|
|
|
|
|
|
| |||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Share capital |
|
| 3,233,750 |
|
|
| 3,233,750 |
| ||
Reserves |
|
|
| 108,755,713 |
|
|
| 105,787,478 |
| |
|
|
|
|
|
|
|
|
|
|
|
| Attributable to the owners of the Holding Company |
| 111,989,463 |
|
|
| 109,021,228 |
| ||
| Non-controlling interests |
| 17,575,976 |
|
|
| 16,249,228 |
| ||
| Total equity |
|
| 129,565,439 |
|
|
| 125,270,456 |
| |
|
|
|
|
|
|
|
|
|
|
|
NON-CURRENT LIABILITIES |
|
|
|
|
|
|
| |||
|
|
|
|
|
|
|
|
|
|
|
| Long-term finances |
|
| 69,904,395 |
|
|
| 32,771,993 |
| |
| Long-term deposits |
|
| 230,597 |
|
|
| 90,264 |
| |
| Deferred liabilities |
|
| 11,225,328 |
|
|
| 11,431,338 |
| |
| Lease Liabilities |
|
| 178,620 |
|
|
| - |
| |
| Other long term liabilities |
| 5,289,042 |
|
|
| 5,078,003 |
| ||
|
|
|
|
| 86,827,982 |
|
|
| 49,371,598 |
|
CURRENT LIABILITIES |
|
|
|
|
|
|
|
| ||
| Current portion of long-term finances |
| 1,551,006 |
|
|
| 1,694,503 |
| ||
| Trade and other payables |
| 48,061,360 |
|
|
| 36,059,184 |
| ||
| Provision for taxation |
|
| 1,865,540 |
|
|
| 1,699,742 |
| |
| Accrued return |
|
| 347,602 |
|
|
| 619,500 |
| |
| Short-term borrowings and running finance |
| 16,272,116 |
|
|
| 12,161,232 |
| ||
| Current portion of liabilities against assets subject to finance lease |
| 39,845 |
|
|
| - |
| ||
| Unclaimed dividend |
|
| 144,519 |
|
|
| 53,953 |
| |
| Unpaid dividend |
|
| 23,706 |
|
|
| 91,119 |
| |
|
|
|
|
| 68,305,694 |
|
|
| 52,379,233 |
|
|
|
|
|
| 155,133,676 |
|
|
| 101,750,831 |
|
CONTINGENCIES AND COMMITMENTS |
|
|
|
|
|
|
| |||
|
|
|
|
|
|
|
|
|
|
|
TOTAL EQUITY AND LIABILITIES |
| 284,699,115 |
|
|
| 227,021,287 |
|
| LUCKY CEMENT LIMITED |
| ||||||||||||||||
| Condensed Interim Consolidated Statement of Profit or Loss and Other Comprehensive Income |
| ||||||||||||||||
| For the 3rd quarter and nine months ended March 31, 2020 (Un-audited) |
| ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
|
|
| Nine Months Ended |
| Quarter Ended |
| ||||||||||||
|
|
| March 31, |
| March 31, |
| March 31, |
| March 31, |
| ||||||||
|
|
| 2020 |
| 2019 |
| 2020 |
| 2019 |
| ||||||||
|
|
| (PKR in '000') |
| ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Revenue |
| 123,988,042 |
| 103,320,389 |
| 44,429,995 |
| 35,466,328 |
| |||||||||
Less: Sales tax and excise duty |
| 24,234,883 |
| 16,764,874 |
| 8,783,377 |
| 5,463,025 |
| |||||||||
| Rebates, incentives and commission |
| 5,319,131 |
| 4,489,902 |
| 1,951,896 |
| 1,657,541 |
| ||||||||
|
|
| 29,554,014 |
| 21,254,776 |
| 10,735,273 |
| 7,120,566 |
| ||||||||
|
|
|
|
|
|
|
|
|
|
| ||||||||
|
|
| 94,434,028 |
| 82,065,613 |
| 33,694,722 |
| 28,345,762 |
| ||||||||
|
|
|
|
|
|
|
|
|
|
| ||||||||
| Cost of sales |
| (79,678,132) |
| (63,799,985) |
| (28,585,408) |
| (21,779,033) |
| ||||||||
| Gross profit |
| 14,755,896 |
| 18,265,628 |
| 5,109,314 |
| 6,566,729 |
| ||||||||
| Distribution cost |
| (5,799,983) |
| (4,296,137) |
| (2,050,617) |
| (1,458,307) |
| ||||||||
| Administrative expenses |
| (3,185,645) |
| (2,308,421) |
| (1,147,744) |
| (776,794) |
| ||||||||
| Finance cost |
| (2,015,548) |
| (1,151,277) |
| (830,024) |
| (376,944) |
| ||||||||
| Other expenses |
| (603,830) |
| (1,313,476) |
| (208,580) |
| (411,496) |
| ||||||||
| Other income |
| 4,066,636 |
| 3,061,838 |
| 1,274,347 |
| 1,138,122 |
| ||||||||
| Profit before taxation |
| 7,217,526 |
| 12,258,155 |
| 2,146,696 |
| 4,681,310 |
| ||||||||
| Taxation |
|
|
|
|
|
|
|
|
| ||||||||
| - current |
| (2,005,596) |
| (3,332,147) |
| (603,474) |
| (1,209,033) |
| ||||||||
| - deferred |
| 469,905 |
| 1,071,569 |
| 215,798 |
| 388,038 |
| ||||||||
|
|
| (1,535,691) |
| (2,260,578) |
| (387,676) |
| (820,995) |
| ||||||||
| Profit after taxation |
| 5,681,835 |
| 9,997,577 |
| 1,759,020 |
| 3,860,315 |
| ||||||||
| Attributable to: |
|
|
|
|
|
|
|
|
| ||||||||
| Owners of the Holding Company |
| 4,650,969 |
| 9,260,243 |
| 1,438,851 |
| 3,464,738 |
| ||||||||
| Non-controlling interests |
| 1,030,866 |
| 737,334 |
| 320,169 |
| 395,577 |
| ||||||||
|
|
| 5,681,835 |
| 9,997,577 |
| 1,759,020 |
| 3,860,315 |
| ||||||||
| Other comprehensive income for the period |
|
|
|
|
|
| |||
| Other comprehensive (loss) / income which may be reclassified to statement of profit or loss in subsequent periods |
|
| |||||||
| Foreign exchange differences on translation of foreign operations |
| 557,938 |
| 1,339,539 |
| 933,363 |
| 138,983 | |
| Other comprehensive (loss) / income which will not be reclassified to statement of profit or loss in subsequent periods |
|
|
|
|
|
| |||
|
|
|
|
|
|
|
|
|
| |
| Unrealized (loss) / gain on remeasurement of equity investment at fair value through other comprehensive income |
| (9,027) |
| (5,912) |
| (8,107) |
| 5,026 | |
| Deferred tax thereon |
| 1,354 |
| 887 |
| 1,216 |
| (753) | |
|
|
| (7,673) |
| (5,025) |
| (6,891) |
| 4,273 | |
| Total comprehensive income for the period |
| 6,232,100 |
| 11,332,091 |
| 2,685,492 |
| 4,003,571 | |
|
|
|
|
|
|
|
|
|
| |
| Attributable to: |
|
|
|
|
|
|
|
| |
| Owners of the Holding Company |
| 5,201,234 |
| 10,594,757 |
| 2,365,323 |
| 3,607,994 | |
| Non-controlling interests |
| 1,030,866 |
| 737,334 |
| 320,169 |
| 395,577 | |
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| 6,232,100 |
| 11,332,091 |
| 2,685,492 |
| 4,003,571 | |
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| (PKR) |
| (PKR) | |||||
| Earnings per share - basic and diluted |
| 14.38 |
| 28.64 |
| 4.45 |
| 10.71 |
Directors' Report
The Directors have the pleasure in presenting to you the financial results of your Company which include both, stand-alone and consolidated financial statements for the nine months ended March 31, 2020.
Overview
Cement industry in Pakistan grew by 7.1% to 37.04 million tons during the nine months ended March 31, 2020 in comparison to 34.58 million tons during the same period last year. Local sales volume registered a growth of 3.9% to 30.59 million tons during the current nine months in comparison to 29.44 million tons during the same period last year. Export sales volumes registered an increase of 25.7% to 6.45 million tons during the nine months under review as compared to 5.13 million tons reported in the same period last year.
In comparison to the Cement Industry, your Company's overall sales volumes declined by 2.6% to 5.80 million tons during the current nine months ended March 31, 2020. This was due to decline in local sales volumes by 7.0% which were 4.11 million tons in comparison to 4.42 million tons during the same period last year, due to competition arising from new capacities coming online. On the other hand, export sales volumes of the Company improved by 10.4% to 1.69 million tons as compared to 1.53 million tons during the same period last year.
On a consolidated basis, your Company achieved a gross turnover of PKR 123.99 billion which is 20.0% higher as compared to the same period last year's turnover of PKR 103.32 billion. The increase in turnover is mainly attributable to commencement of operations of KIA Lucky Motors.
Moreover, consolidated Net Profit of the Company was PKR 5.68 billion of which PKR 1.03 billion is attributable to non-controlling interests which translates into an EPS of PKR 14.38 during the current nine months ended March 31, 2020 as compared to PKR 28.64 during the same period last year.
Business Performance
a. Production & Sales Volume Performance - Standalone
The standalone production and sales statistics of your Company for the nine months ended March 31, 2020, compared to the same period last year are as follows:
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Clinker Production | 5,058 | 5,448 | (7.2%) |
Cement Production | 4,969 | 5,183 | (4.1%) |
Cement Sales | 4,964 | 5,183 | (4.2%) |
Clinker Sales | 837 | 771 | 8.6% |
The production and sales volume data is graphically presented as under:
A comparison of the dispatches of the Industry and your Company's standalone business for the nine months ended March 31, 2020 compared with the same period last year is presented below:
Financial Performance - Standalone
The standalone financial performance of your Company for the nine months ended March 31, 2020, as compared to the same period last year is presented below:
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Revenue During the nine months of 2019-20 under review, your Company's overall gross sales revenue declined by 8.3% as compared to the same period last year. Where, although the export sales revenue showed an increase of 18.6% (PKR 9.87 billion vs PKR 8.32 billion) but the local sales revenue decline of 13.4% (PKR 38.08 billion vs PKR 43.99 billion) lead to the overall drop of 8.3% in the gross sales revenue.
This was mainly due to lower sales volumes as a result of competition arising from new capacities and low retentions due to higher transportation and logistics costs. |
Cost of Sales Moreover, during the nine months under review, per ton cost of sales of your Company increased by 9.1% as compared to the same period last year. The increase was mainly attributable to exceptional increase in gas and other fuel prices, higher fixed costs absorption (due to lower volumes) and higher transportation costs on input materials. | |
Gross Profit In view of the lower sales volumes & retentions and higher input costs, as mentioned above, Gross profit margins of the company for the nine months under review were 13.9% as compared to 30.0% reported during the same period last year. |
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Net Profit
Similarly, your Company achieved a profit before tax of PKR 3,278.3 million during the nine months under review as compared to PKR 9,750.4 million reported during the same period last year.
Accordingly, after tax profit of PKR 2,935.4 million was achieved during the nine months under review as compared to PKR 8,293.9 million reported during the same period last year.
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Earnings per share
As a result of factors discussed above, the earnings per share of your Company for the nine months ended March 31, 2020 was PKR 9.08 in comparison to PKR 25.65 reported during the same period last year. |
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Projects - New and Ongoing
Investments
Investment in 1 x 660 MW, supercritical, coal based power project
The construction activity for setting up 660 MW super critical, lignite coal-based power plant was moving as per Schedule before the outbreak of COVID-19 in China with the targeted Commercial Operation on 1st March, 2021. On 6th February 2020, the Construction and Supply Contractors of the Company declared other Force Majeure Event (FME) under the provisions of their respective agreements due to outbreak of COVID-19 and notified that there is possible risk of delay in Project implementation. On 27th March, 2020, the Company also received FME notice on the same account from Central Power Purchasing Agency (CPPA) notifying possible delay in COD of Lahore Matiari transmission Line and thus may cause delayed provision of interconnection facility which is required to be provided by CPPA not later than 120 days prior to Commercial Operation Date. The precise assessment of FME on the project commercial operation timeline could not be made at this stage as FME is still in place. However, the Company in coordination with its Contractors and the CPPA is taking mitigating measures to contain the delay.
Greenfield cement plant expansion in Samawah, Iraq - 1.2 million tons per annum
While major shipments of plant and machinery have reached site and erection work is under progress, some critical refractory, mechanical and electrical items are however under shipment and will reach during the month of June as per current understanding with the suppliers. Other necessary materials and resources are available at SITE and work is in progress during the locked down period arising out of COVID 19 pandemic situation.
As earlier envisaged, project completion is still targeted in the 2nd quarter of financial year 2020-21. However, if the situation of COVID 19 pandemic worsens, project completion timelines would be delayed.
Corporate Social Responsibility
With a primary focus on Education, Women empowerment, Health and Environment conservation, your Company is committed for the development of society and the communities in which it operates.
Education / Scholarships
In continuation of its long-term objective to provide merit-based support for the deserving and less privileged segments of the society, your Company continued to extend scholarships to various students of leading universities in Pakistan and abroad.
Women Empowerment
To empower women through education has been an ongoing process with the collaboration of Zindagi Trust in which your Company has been supporting two leading Government girls' schools in Karachi. These schools have been transformed into model girls' educational institutions in Pakistan.
Health Initiatives
Provision of quality healthcare for the society at large continues to remain your Company's priority, especially through financial support of Aziz Tabba Foundation; a prominent philanthropic institution that is running Tabba Heart and Tabba Kidney institutes, which provide vital support in bridging the gap of specialized and modern medical care available in the Country.
Environment Conservation
Your Company always takes responsibility towards the environment seriously and in an effort to highlight the importance of environment conservation; your Company continued with its pro-environment initiatives including tree-plantation drives in and around its manufacturing sites.
Outlook
Post relaxation of COVID-19 lockdown in the North, dispatches have reached 80% of pre-lockdown volumes. Dispatches in the South however continue to suffer due to lock down in Sindh province and are at one third of normal volumes. Export volumes are also very thin due to low demand from foreign buyers.
Based on the demand projections in North and the fact that majority of players are presently operating in losses, management expects that the prices in North will recover. In South due to lower economic activity as a result of COVID-19 lock down, volumes will remain under pressure. However, once the pandemic situation eases, we also expect that the package announced for the construction industry by the Federal Government will have a positive impact on the cement demand.
Acknowledgement
Directors of your Company take this opportunity to express sincere gratitude and appreciation for unrelenting commitment and contribution of its people and the trust and confidence placed in the Company by all the stakeholders.
On behalf of the Board
MUHAMMAD YUNUS TABBA MUHAMMAD ALI TABBA
Chairman / Director Chief Executive / Director
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Karachi: April 23, 2020
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