Pakistan: Cherat Cement 1HFY16 profit rises 6%

Pakistan producer Cherat Cement Co reported a profit after tax of PKR676.2m (US$6.48m) in the first half of FY16 versus PKR639.8m a year earlier, which translates to a six per cent YoY rise.

The company reported stable dispatches (+1 per cent) stemming from rising domestic sales which were up by 13 per cent YoY. The advance in local dispatches was attributed to an acceleration in private sector construction activity and the partial materialisation of the projects under the government's budgeted Public Sector Development Programme. However, Cherat reported a sharp deceleration in exports, which fell 24 per cent YoY due to the withdrawal of NATO troops and an uncertain political situation in Afghanistan, plus increased competition from Iranian cement.

Gross profit margins were better at 34 per cent versus 29 per cent in 1HFY15. The improvement was  attributable to a decline in international coal prices, energy management measures taken by Cherat and lower electricity costs.