Thatta Cement majority shareholder shares stake to consortium

The majority shareholder of Thatta Cement, Pakistan, has sold its stake to a consortium of four private companies.

In an announcement sent to the Karachi Stock Exchange last week, Arib Habib Corp (AHC), along with its subsidiaries, said it has sold its 61 per cent holding in Thatta Cement to the consortium PKR24.16/share. The total value of the transaction is approximately PKR1.46n (US$14.75m).

Two private buyers companies, Sky Pak Holding and Al-Miftah Holdings each bought 22.7 per cent of the company’s shares, while two other private companies – Golden Globe Holding and Rising Star Holding – bought 8.47 per cent and seven per cent of Thatta Cement’s shares respectively.

Thatta Cement operates a 0.5Mta cement plant located at Makli in the district of Thatta, Sindh.

In the first six months of the current fiscal year, Thatta reported a 25.21 per cent rise in sales compared to the previous year mainly attributed to improvements in the domestic market. Export sales, however, shrank significantly by 74.16 per cent.

A half-year report by the company said frequent load shedding from The Water and Power Development Authority (WAPDA) adversely impacted plant operations. It is expected that the impact on production due to interruptions in the supply of electricity will be mitigated in the remaining period of the financial year as the company is expected to receive uninterrupted power supply from its subsidiary, which has commenced its commercial operation with effect from December 12, 2012.

Capacity utilisation during the half year under review stood at 76 per cent as compared to 58 per cent for the same period of last year. Overall clinker production was higher by 31 per cent as compared the same period of last year.

Overall cement dispatches for the six months were higherby 8,408t (4.92 per cent) compared to same period of last year. Local dispatches were 170,062t compared to 135,818t, an increase of 25.21 per cent. Cement exports declined to 9,001t as to 34,837t during the corresponding period representing a decline of 74.16 per cent Decline in exports was due to strategic shift in Company’s sales mix.

Turnover increased by 22.15 per cent which positively impacted gross profit margin growth to 18.51 per cent compared to 6.89 per cent in the corresponding period. The company earned a profit after tax of PKR24.17m compared to a loss of PKR 88.48m in 6MFY2011.