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ARM Cement expects improved 2H15

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World Cement,

ARM Cement’s Managing Director Pradeep Paunrana has told Reuters that production costs have fallen since the company launched its clinker line in April this year. The new line has a capacity of 1.2 million tpy and is operating at about 75% utilisation. Imported clinker costs between 70 and 80% more than locally produced clinker, Paunrana told Reuters.

ARM reported a pretax loss of KES473.5 million in 1H15, attributed to foreign exchange losses associated with the financing of the new clinker line. Thomson Reuters data put ARM’s operating margin at 13.4% in 2014, below the industry median of 15.5%. Production from the new plant is expected to improve margins in both Kenya and Tanzania, Paunrana said, adding that the company is expecting better financial results in 2H15.

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