LAFARGE Zambia Plc has posted losses of over K12.3 million during its financial half-year period ending June 30, 2020, mainly induced by increased production costs and a devalued kwacha.
And the cement company says it will continue to focus on developing the export market to sustain its growth as the domestic market remains substantially oversupplied with the commodity.
Announcing its unaudited results of the company for the six month period ended June 30, Lafarge said the company posted losses amounting to K12.3 million for the period under review compared to K43.2 million during the corresponding period last year, triggered by the kwacha’s depreciation against major currency convertibles, which had negatively impacted on input costs and profit margins.
The local currency depreciated to close the second quarter at around K18 per dollar compared to trading at K14 per dollar by the start of the year.
“Increase in production costs due to depreciation of the kwacha against the US dollar and continued impact of increased energy costs has negatively impacted the margins and profit,” Lafarge stated.
And it added that its focus would be on developing the export market to meet rising demand in view of the saturated domestic market.
“The domestic market has continued to be substantially oversupplied, the company continues to look to develop the export market in order to sustain growth. We also remain committed to doing business in a safe and sustainable way that allows the community in which we operate in to partake in the benefi‑ts the business generates and shelters the environment, in line with global LafargeHolcim standards. Through our Geocycle division we are continuously looking at ways of using alternative energy sources that are more environmentally friendly and carbon neutral,” stated Lafarge.