Kwacha haunts cement price

LAFARGE Cement Zambia Plc says the weak Kwacha is putting pressure on cement prices due to input costs imported from other countries.
The local currency has generally been trading at the level of K5, 200 and K5, 300 for buying and selling respectively on the interbank.
Company chief financial officer Chrissie Moloseni said apart from the trading of the Kwacha against dollar exchange rate affecting the prices, domestic and regional market conditions are contributing as well.
Ms Moloseni said this prevented price adjustments from recovering the increases in input costs particularly in the first half of the year.
This is contained in the 2011 annual report made available at the annual general meeting (AGM) in Lusaka on Friday last week.
She said the fluctuation in the Kwacha exchange rate resulted in net losses on translation of foreign currency balances.
“The export and domestic selling prices were reviewed once during the year. Export prices were monitored in relation to the movement in the exchange rate and regional prices to prevent erosion of margin and to ensure that a competitive position is maintained,” she said.
Ms Moloseni, however, said strong volumes particularly in the second half of the year optmised sales mix and cost reduction initiatives increased operating margin to 36 percent in 2011 from 30 percent in 2010.
Meanwhile, Lafarge Cement recorded an increase in turnover of K879. 1 billion from K733. 900 billion in 2010.

Daily Mail

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