Trinidad Cement posted strong first quarter results for 2015 with profit after tax rising sharply to $42.5 million versus just $13 million the year before, from revenues of $515 million.
Revenues were just slightly better than the $513 million generated in 2014. Group revenue increased, due mainly to cement price increases implemented during 2014 and 11,100 tonnes increase in clinker sales volume. Cement sales volume declined by 4 percent, Management stated in their release of the results to the stock exchanges on which it is listed in Trinidad and Jamaica. Vastly improved results in Jamaica, was one of the major contributor to the improvement.
During the quarter interest cost rose to $56.4 million, compared with $50.8 million but depreciation fell from $31.5 million to $27.7 million incurred in 2014. Taxation charge however, increased from $4 million to $10.4 million.
The company had effectively defaulted on its loans but that has been remedied with the execution of the restructured debt agreements. The loans have now been re-classified from short term to long term, thus improving the working capital from a deficit of $1.5 billion at December 31, 2014, to a surplus of $650 million at March.
The company’s rights issue was successfully concluded in March, with 124.9 million shares issued to raise $361.5 million. In addition, restructured debt agreements with lenders came into effect as at the end of March, the main elements of which include: Interest rate savings of 2 percent reduction; forgiveness of the default moratorium interest from September 30, 2014 and a discount offered by the financiers if the loan is repaid in 90 days.
Funds generated from operation based on the results and the rights issue resulting in net cash balance at the end of March of $548.3 million.
The stock which was elevated to BUY RATED in 2013 continues to hold that status as earnings for the full years heads towards 60 cents per share.
TCL continues to gain strength
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