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Premier Cement shows splendid performance in Q3

New plant augments production capacity significantly
Shakhawat Hossain Sumon
08 May 2023 00:00:00 | Update: 08 May 2023 00:03:37
Premier Cement shows splendid performance in Q3

Premier Cement Mills PLC posted more than 20 times higher profits year-on-year in the January-March quarter of the current fiscal year, thanks to new investments, causing to boost earnings by leaps and bounds.

The cement maker reported Tk 30.81 crore in net profit in the third quarter of the fiscal year 2022-23, against profit of Tk 1.51 crore in the same quarter last fiscal.

Meanwhile, the publicly traded company witnessed over 41 per cent surge in revenue in the just concluded quarter this fiscal.

The cement producer’s revenues rose to Tk 601 crore in the January-March quarter of the fiscal 2022-23 from Tk 425 crore in the corresponding quarter last fiscal.

The cement maker has established a new manufacturing plant with a hefty investment of Tk 700 crore that went into production in July last year, the prime cause behind the lofty surge in its earnings, company officials said.

The tech-savvy new plant escalated the company’s production capacity manifold, while the plant is also helping the firm produce cement at a lower cost.

With the new plant being operational, the cement maker’s production capacity has reached 24,520 metric tonnes per day from the previous capacity of 8,000 metric tonnes of cement.

The listed firm had spent over Tk 700 crore to set up the new plant with vertical roller mill (VRM) technology, of which Tk 380 crore was taken as a loan from Standard Chartered Bank in the UK, while the remaining amount was sourced from local banks, company officials having knowledge with the matter said.

The company made a profit of Tk 16.60 crore in the third quarter of the fiscal 2020-21.

The company’s cement sales jumped by 41 per cent year-on-year in the January-March quarter this fiscal, while the sale of empty cement bags surged 46 per cent during the period, according to its latest financial report.

Kazi Shafiqur Rahman, company secretary of Premier Cement told The Business Post, “After the start of the new plant, our production capacity increased on a large volume, resulting in higher revenues and profits.”

Regarding the sale of empty cement bags, he said, “The demand for our empty cement bags has grown up significantly in the market. Heidelberg Cement, in particular, buys a bulk number of cement bags from us.”

The company earned Tk 15.83 crore from the sale of empty cement bags in the latest quarter of FY23, against Tk 10.87 crore in the same quarter last year.

Premier Cement in 2014 started a plant for the production of cement bags. This plant is currently capable of producing 26 lakh bags per year.

As per a source at the company, it has 20 vessels, 54 bulk carriers, 90 trucks, and 267 covered vans for the transportation of cement and raw materials.

The company had revenue of Tk 363.38 crore in the third quarter of fiscal 2020-21, and Tk 318.47 crore in the same quarter of the fiscal 2019-20.

Despite a stellar surge in revenues and profits, the cement maker witnessed a 33 per cent year-on-year fall in export in the January-March period of FY23.

From exports, the company generated Tk 8.34 crore worth of revenues in Q3 this fiscal, which was Tk 12.43 crore in the same period last fiscal.

Premier Cement got listed on the stock market in 2013 under the proprietorship of TK Group and GPS Group. That year, it sold its shares to investors for Tk 22, with a premium of Tk 12.

Premier Cement shares closed at Tk 50.60 per share on the trading floor of the Dhaka Stock Exchange (DSE) on Sunday.

The cement maker’s paid-up capital is Tk 105.45 crore, while it has a reserve of Tk 558.21 crore.