Profit down by two-thirds at Caribbean Cement

Caribbean Cement Company Limited’s profit plunged in the July-September period, but it expects to recover in the December quarter amid increased production.

“As we go into the final quarter of the year, we are committed to a return to pre-Hurricane Beryl supply,” said Caribbean Cement, the producer of Carib Cement and Jamaica’s sole manufacturer of the commodity.

The company reported profit of $630 million for the third quarter, down from $1.94 billion a year earlier.

Caribbean Cement, which is worth $39.4 billion by assets, blamed its underperformance on disruptions caused by Hurricane Beryl, which hit Jamaica in July. Additionally, the planned maintenance of key production equipment during the quarter increased operational costs and further impacted revenue.

“This sharp decline was primarily due to reduced sales caused by Hurricane Beryl, intensive weather that affected our ability to resume production after the major shutdown, and increased operating costs related to a scheduled plant-maintenance shutdown. The maintenance was undertaken to enhance operational efficiency and boost production capacity to meet local market demand,” the cement maker said.

Revenue for the quarter decreased by 11.2 per cent to $6.2 billion, down from $7 billion in the third quarter of 2023. The decline in sales was exacerbated by the disruption in production, which affected the company’s ability to meet demand. Over nine months, January to September, revenue ticked up to $21.5 billion, a relatively flat outturn compared with sales of $21.3 billion in the same period a year ago.

Despite the quarter’s challenges, Caribbean Cement’s nine-month earnings showed resilience, with profit at $4.9 billion, compared to $4.4 billion a year earlier. Its cash and other liquid holdings climbed to $9.35 billion at the end of September, from $638 million a year earlier.

Caribbean Cement insists that it will keep the distribution trade well-supplied during the Christmas period in response to public concerns regarding cement scarcity.

“By actively engaging with our stakeholders, we have prioritised the needs of the local cement market and made strategic decisions that reflect our commitment to their interests,” the company said. It includes increased production and supply-chain optimisation.

“This has already begun paying dividends, resulting in a strengthening of product inflows into our islandwide depots, positioning the company robustly to meet market demands and reach inventory levels above our historical averages thus ensuring a sustainable supply,” Caribbean Cement said.

steven.jackson@gleanerjm.com