33
of these, there were also some successes: the Group completed the debt re-profiling
exercise in May and met its first interest payment of TT$51.2 million in December;
during the 92-day strike, TCL kept the local market reasonably well supplied, while
the Group secured advance sales deposits of US$12 million, which provided critical
funding to CCCL and ACCL to undertake vital plant repairs.
The 3.5% increase in revenue was due to price increases implemented in the
domestic markets and some export markets, as domestic and export cement sales
volumes decreased by 4% and 24% respectively compared to 2011.
In Trinidad and Tobago, sales volume was 511,600 metric tonnes (MT), a shortfall of
24,000 MT from the prior year (4%) mainly due to the strike.
In Jamaica, while the market contracted by 5%, CCCL’s market share increased by
1% over 2011, resulting in sales volume of 536,300 MT, a decline of 17,000 MT (3%)
from 2011.
In Barbados, cement volumes declined by 11% as the market remained depressed.
Group export cement volumes decreased by 24%, mainly due to the strike action
at TCL and production challenges at ACCL (38% lower than 2011), which prevented
that company from capitalising on sales opportunities created by the shutdown
of TCL for three months. CCCL sold 203,800 MT in the export markets benefiting
from the shortfalls by TCL and ACCL. However, this was still 6% below its 2011
export volume.
Total Group domestic cement volumes amounted to 1.15 million MT compared
to 1.20 million MT for 2011, while the plants’ export volumes were 453,500 MT
compared to 621,200 MT for 2011.
Concrete sales volumes amounted to 111,200 cubic meters (m
3
) compared
with 108,600 m
3
for 2011, while average concrete prices were 9% higher in 2012.
The packaging segments’ sack and sling volumes decreased by 18% and 13%
respectively, largely affected by the cement plants’ reduced total cement volumes.
Earnings before Interest, Tax, Depreciation and Amortisation (EBITDA)
EBITDA from continuing operations was $159.9 million, which represented an
increase of $72.3 million or 82% compared with 2011, despite the significant
challenges noted earlier. This favourable result was driven mainly by the increased
revenue and higher margins from price increases, combined with cost containment
measures. In particular, the Group was able to reduce the cost of equipment hire and
haulage (8% savings compared to 2011) and energy costs (5% lower than 2011).
Additionally, shipping activity recorded a lower net cost of $14. 5 million as a result of
the renegotiation of the vessels’ lease rates as well as the sub-letting of one vessel.
Net Finance costs
Net finance costs were $245.0 million compared to $188.0 million in 2011, an
increase of $57.0 million or 30%. Included in finance costs is interest of $211.0
million compared to $184.7 million in 2011, an increase of $26.3 million arising
from a higher loan principal due to the capitalisation of interest at 30 June and 30
September, 2012, in accordance with the restructuring agreement. There was also
a foreign exchange loss of $33.7 million in 2012 (2011: $3.2 million loss), as a result
of the persistent depreciation of the Jamaica dollar against the United States Dollar.
The Year in Review
Group CEO’s Report and Management Discussion 2012 (continued)
