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on February 14, 2023, Mahafuz Ula Babu, the profit margin of the cement industry at the end of 2021 reached the lowest level in a decade due to soaring costs, slow construction and fierce competition.

At 9:40 p.m.

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Like its competitors, PremierCementMills Ltd worked hard to achieve some profits until March last year, because its earnings per share (EPS) in the first nine months of fiscal year 2021-22 (July 2021 to March 2022) fell to 0.37 Taka from 4.07 Taka in the same period a year ago.

According to cement analysts, except Lafarge Holcim Bangladesh (Bangladesh), which relies on its own limestone source (from the nearby Indian state of Meghalaya) and raw materials of its own conveyor belt, and MeghnaCement, which may have become conservative, no listed cement manufacturer can maintain their profits in the quarter from April to June.

During the settlement period of the letter of credit, this figure soared to Taka 110.

The sales of PremierCement increased significantly, thanks to its strengthened marketing efforts and the new production capacity put into operation in July, and the company ranked first in terms of installed capacity.

With the rise of the dollar in the fixed and unrealistic market of the central bank and the commercial banks that settle letters of credit, the gap between interest rates has begun to narrow, and the foreign exchange losses of enterprises have begun to decrease.

The foreign exchange crisis in 2022 hit the industry even more.

The listed company lost 11.07 Taka per share in the remaining three months, which forced the company to report an annual loss even more than the paid-in capital in the 2021-22 fiscal year.

The quarterly loss is equivalent to 92.6% of Aramit-cement’s paid-in capital, 70.3% of Confidence-cement, 24.5% of CrownCement, 6.6% of Heidelberg-cementBangladesh and 110.7% of Premier-cement.

However, the impact of exchange rate began to ferment because it increased the unbearable foreign exchange losses.

In addition, Crown Cement rebounded to the profit area, while Meghna Cement’s profit declined slightly.

Industry insiders said that the gap between foreign exchange expectations and reality was the highest between April and September.

The company imported raw materials and priced the products based on the USD value of Tk 85-88.

Selim Reza, the company’s chief financial officer, said that the unexpected blow came from the turbulence in the US dollar market.

Md Shahidullah, vice chairman of the Bangladesh Cement Manufacturers Association (BCMA), said that when the gross profit rate of the industry reached the lowest level in ten years, the production level of a company was still under pressure.

According to the data of Bangladesh Cement Manufacturers Association (BCMA), the consumption of cement in Bangladesh fell by more than 1.5% in 2022.

The company has considerable reserves and managed to declare a cash dividend of 10% to its owners in the previous fiscal year.

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As the central bank slightly transferred the dollar market to the banking industry in September last year, the gap between the official exchange rate of the dollar and the market exchange rate narrowed to a higher single-digit percentage point, and foreign exchange losses further reduced.

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Confidence cement rebounded to the profit area, and other loss-making companies significantly reduced their losses from July to September.

“Despite the great pressure, our business is profitable,” he told Business Standards, adding that almost all losses were caused by the depreciation of Taka and the strengthening of the US dollar.

In addition, in the quarter from October to December, even Premier Cement achieved some profits.

According to the company, the US dollar is still expensive, and the bank hardly agrees to open a letter of credit for the import of raw materials unless…

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Its stock price did not fall due to the minimum price set by the Bangladesh Securities and Exchange Commission.