LONDON (Alliance News) - Steppe Cement Ltd Thursday said an increase in sales during 2015 was not enough to offset lower cement prices, leading to declines in revenue, and said it also lost a considerable amount of market share over the year.
Steppe managed to boost cement sales in 2015 by 2% from the previous year, but average cement prices dropped by 8% in 2015, causing revenue for the full year to decline by 7%.
Revenue totalled KZT19.53 billion in 2015 compared to KZT20.92 billion in 2014 as sales grew to 1.6 million tonnes. However, average cement prices fell to KZT11,890 per tonne compared to KZT12,975 per tonne a year ago.
Steppe Cement said pricing was mostly affected by pricing pressure from Russian imports, which also increased during the year, until the Kazakhstan government chose to devalue the tenge back in August.
The amount of cement imported into Kazakhstan from Russia also increased to 1.2 million tonnes in 2015 from 1.1 million tonnes a year earlier, whilst the amount of cement exported out of Kazakhstan fell to only 100,000 tonnes from 500,000 tonnes.
There was further bad news for the company after reporting it lost market share over the year. Cement consumption in Kazakhstan grew 11% over the year, with the country consuming around 9.5 million tonnes annually, but Steppe's performance led to its market share dwindling to 17.3% in 2015 compared to 19% in 2014.
Steppe Cement shares were trading down 4.5% to 16.0 pence per share on Thursday morning.
By Joshua Warner; joshuawarner@alliancenews.com; @JoshAlliance
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Steppe Cement (STCM)