Steppe Cement records net profit of US$9.7m in 2019

Steppe Cement has released its annual results for 2019 and records a net profit of US$9.7m. EBITDA increased to US$23.9m from US$21.4m in 2018 aided by higher prices.

The Kazakhstan-based producer sold 1.715Mt in 2019, compared to 1.72Mt in 2018. The company's domestic cement sales grew by four per cent, while its exports fell by 29 per cent due to increased competition from new plants in Uzbekistan and Kyrgyzstan, and the strength of the tenge against the som in the 2H19.

Both kiln lines operated at 88 per cent of their combined capacity. Line 5 produced 0.995Mt and Line 6 produced 0.721Mt. Production costs per tonne increased by 10 per cent due to coal and transportation pricing.

Steppe Cement's average cement selling prices rose by eight per cent in local currency but dropped by two per cent in US dollars to US$46.6/t delivered.

Kazakhstan's cement market grew by two per cent to 8.9Mt in 2019, according to Steppe Cement. Imports to Kazakhstan fell by 10 per cent to 0.7Mt or eight per cent of the total market. In April 2019 the government closed imports from Iran to west Kazakhstan, but at the same time Uzbekistan stopped imports from Kazakhstan.

The company directed capital investment to improvement of the cement mills, silos and packaging to reduce power consumption in 2019. In 2020 the company endeavours to conserve cash and limit capital investment to ecological and energy-saving projects. However, approximately US$2m will be invested in a cooler EP fan system, pan conveyor replacement, slag drier filter and automation, plus laboratory equipment.