Cement Sector Posts Strong Profit Growth
The cement sector (KSE-100) recorded a 38% rise in profit during FY25, reaching Rs. 167.0bn compared to Rs. 121.4bn a year earlier.
Sales grew by 7% to Rs. 896bn in FY25. In 4QFY25, sales increased by 5% YoY but fell 16% QoQ. The improvement in annual sales came mainly from higher retention prices and a 2% rise in dispatches to 37.4mn tons. In 4QFY25, dispatches increased by 4% YoY and 2% QoQ to 9.3mn tons.
Gross margins improved to 30.7% in FY25, supported by higher retention prices, lower coal costs, and a better power mix.
Other income rose 33% to Rs. 36.4bn, driven by higher interest and dividend income.
Finance costs dropped 34% to Rs. 46.0bn due to lower interest rates and reduced borrowings.
Average cement prices in FY25 stood at Rs. 1,434 per bag in the North (+16%) and Rs. 1,395 per bag in the South (+17%), reflecting higher FED and stronger retention prices. In 4QFY25, retention prices increased 4% QoQ in the North and 3% QoQ in the South.
Meanwhile, coal prices averaged USD 102 per ton, down 4.6% YoY, helping manufacturers improve margins. In 4QFY25, coal prices averaged USD 92 per ton, declining 15% YoY and 4% QoQ.
See Report: https://arifhabibltd.com/api/research/open?path=178/68d6a5d0b34e1089ab54520e.pdf
