Pakistan's Thatta Cement has reported net sales of PKR4.26bn (US$19.3m) in the 2022 financial year (ended 30 June, 2022), compared to PKR2.43bn in the previous year. Gross profit came in at PKR320m, down on the PKR384m seen in 2021, while profit for the year was PKR119.3m in 2022, versus PKR201.8m in 2021.
According to the company, 2022 saw a better performance despite tough market conditions and significant uncertainties due to political instability and the Russian-Ukraine war. Other factors, including the rise in energy prices, currency depreciation and a sudden hike in interest rates, also severely affected the industry.
Thatta's cost-to-sales ratio increased to 92.48 per cent in the 2022 financial year, compared to 84.15 per cent in the previous year. This was mainly attributed to a rise in the cost of sales on the back of higher coal prices in the international market and the continuously escalating dollar rate. The company’s power and fuel costs also rose substantially as it purchased electricity from HESCO at much higher rates due to the non-availability of gas for up to five months to Thatta Power (Pvt) Ltd, a subsidiary of Thatta Cement Co Ltd.
In terms of production, Thatta produced 502,659t of cement in the 2022 financial year, up 66.9 per cent YoY, along with 415,810t of clinker, a YoY advance of 18.93 per cent. Dispatches in 2022 came in at 504,496t of cement, up 67.58 per cent YoY, and 4987t of clinker, down 92.83 per cent YoY. According to the company, due to the “proactive approach of management”, Thatta not only consumed the available stock of clinker but purchased the same from the local market at "a very attractive price to meet the customers' demand in local market and diluted the impact of a sudden escalation in coal prices in the international market besides deterioration in rupee-dollar parity during the year".
The company achieved an overall clinker production capacity rate of 63 per cent in 2022, compared to 52.97 per cent in the previous year. Local cement dispatches in terms of volume increased by 67.56 per cent YoY, resulting in growth of revenue from local sales of 82.28 per cent compared to the previous year. The company also actively explored new potential market segments which “significantly contributed” to its sales volumes. A significant improvement was seen in Thatta’s market share in the South region of Pakistan.
