Carthage Cement adopts financial restructuring plan

Tunisian cement producer Carthage Cement has presented its 2019-23 business plan. In terms of financial restructuring Carthage Cement will carry out a capital increase of TND223,774,733 and see its share capital rise to TND395,909,146. The share issue price is TND1.20 (TND1 nominal value and TND 0.20 issue premium) and a parity of 13 new shares for 10 old shares. The financial restructuring will also include a cash contribution of TND153,729,552 with the balance by conversion of receivables. Furthermore, it will enter a global arrangement with the banks to reduce the outstanding debt. This will include a partial repayment of bank debts, a rescheduling of remaining structural debts (TND360m) over 12 years, with a two-year grace period and a reduction of interest rates by two points, which represents an equivalent of TND70m.

In 2019 the company expects to achieve revenues of TND255.6m (US$89.7m) with 63 per cent of this target achieved in the 8M19. It also forecasts gross margins to reach TND121.3m, up 52.9 per cent YoY, and its margin rate to advance to 43.1 per cent from 35.1 per cent in 2018. The company’s EBITDA is expected to more than double to TND72.7m in 2019. 

Expenses will also be reduced as the company’s operating contract with FLSmidth terminated on 9 September without a renewal in place, according to Carthage Cement’s management. The workforce has grown to 688 employees with the transfer of 188 executives and agents trained by FLSmidth to cement producer.