According to the latest quarterly report of LafargeHolcim Bangladesh Ltd (LHBL), a frontline cement producer in Bangladesh, revenue and net profit shrank by three and 15 per cent, respectively, in the 1Q24. The prime reasons could be the increase in the cost of raw materials and the prevailing inflation in the country.
In a statement, Iqbal Chowdhury, CEO, said: “The construction Industry is going through a challenging time, with a consistently high inflationary environment impacting consumption. However, we continued focusing on expanding sales channels, aggregating business, new products and solutions, and improving market presence to ensure stronger results in the coming quarters. We have also entered the Bricks & Blocks market by launching Holcim Blocks, which is environmentally friendly and has growth potential. We also recently won the “Green Factory Award 2023” from the Ministry of Labor and Employment, reflecting our commitment to ensuring a safe workplace for our employees and a sustainable green environment around our operations.”
Business performance
Net sales decreased by three per cent to BDT8.257bn (US$70.52m), compared to BDT8.546bn in the 1Q23. Profit after tax fell to BDT1.627bn from BDT1.909bn during this accounting period.
Geocycle, the company's sustainability arm, continues to address the country’s waste management challenges with long-term solutions, said the company. It safely disposed of over ~10,000t of diverse waste streams during this period, a 25 per cent increase from last year, significantly advancing our green growth agenda. In collaboration with Sylhet City Corp (SCC), Geocycle launched a material recovery plant in Sylhet to sustainably manage the city’s municipal solid waste. This initiative will be crucial in increasing the thermal substitution rate for the rest of the year.
Outlook
The rest of the year will be challenging due to ongoing inflation and persisting foreign exchange pressure. Despite that, the company is optimistic and poised to deliver strong performance with a continuously leading industry margin.
