Tvornica Cementa Kakanj forecasts 10-14% drop in in revenues, Bosnia

Tvornica Cementa Kakanj (TCK), the Bosnian unit of HeidelbergCement expects to post a 10-14% drop in cement sales volume this year as conditions on the local market and the fallout from the eurozone crisis continue to weigh, a senior company official said.

Cement sales are seen at around BAM64m (EUR32.7m) in 2012, TCK's general manager for Bosnia and Herzegovina and Croatia, Branimir Muidza, told SeeNews in an emailed interview.

"On the backdrop of the existing economic environment, our domestic sales volumes are seen flat in 2012 and would depend on the pace of construction activity which is currently lagging the year-ago mark by around 15 per cent,“ Muidza said.

The situation on the Bosnian market is further compounded by an ongoing institutional crisis in the country that has put an additional dampener on foreign investment inflows, the official said, forecasting that domestic cement consumption this year would total around 1.1 million tonnes, down 40% from the pre-crisis 2008 levels.

TCK, which became part of HeidelbergCement in 2000, exports around 12% of its production with the bulk going to the Croatian market.

According to the latest company estimates, it currently operates at 60 per cent of its production capacity and is expected to sell between 420,000-440,000t of cement this year.