Pakistan: Kohat Cement has posted a net profit of US$6.63m in the quarter that ended on 30 September 2014, up by 11% year-on-year compared to US$5.98m during the corresponding period of the previous year. The company attributed the results to better income on cash placements and lower financial charges.
During the first quarter of the 2015 financial year, sales revenues increased by 11% to US$28.1m amid higher cement prices and a slight increase in volumetric sales, which were up by 5% year-on-year. However, Kohat Cement's reduced gross margins restricted earnings growth. The gross margins in the first quarter of 2015 were recorded at 35.5% against 38% in 2014, down by 250%. The decline in gross margins was caused due to the increase in electricity prices by more than 50%.
The quarterly statement also revealed that the company is in the process of installing a 15MW waste heat recovery (WHR) power plant, which is expected to reduce production costs. The plant, which will meet 30% of Kohat Cement's energy requirements, is expected to come online by the end of the 2015 financial year. The project will cost US$19.4m, 80% of which will be financed through debts.