Confidence Cement is going to suspend the operation of its ready-mix concrete (RMC) plant for foreign currency crisis.
In a stock exchange filing on Thursday, the company said its board of directors had decided to stop production of the RMC plant located at Sea-Beach Road, South Patenga, Chattogram for a disruption to raw materials' imports amid the dollar crunch.
The prevailing stagnation in domestic infrastructure development also prompted the decision.
Moreover, newly imposed VAT on ready-mix business has led to price hikes and a decline in demand.
The cement manufacturer, however, did not explain how the production suspension will impact its profit. Its detailed financial statement was not available as the website was nonfunctional.
Meanwhile, the company disclosed its financial results for the second quarter of FY24.
In October-December 2023, it earned Tk 3.5 per share, which was 34 per cent higher than in the same period a year earlier.
According to the company, EPS went up for lower costs on raw materials and lower foreign currency fluctuation losses, according to un-audited financial statements published in a newspaper.
Revenue was down 12 per cent to Tk 927 million in the second quarter of FY24.
But a significant decline in production costs boosted earnings.
The production cost fell from 94 per cent of the sales revenue in the quarter through December 2022 to 83 per cent of the revenue earned in the same period of 2023.
In FY22, Confidence Cement earned a profit of Tk 112 million and paid 5 per cent cash dividends and 5 per cent stock dividends to shareholders. The following fiscal year, it gained a profit of Tk 272 million and disbursed 5 per cent cash dividends and 5 per cent stock dividends.
After the latest earnings declaration, the stock of the company rose 6.85 per cent to Tk 79.50 per share on Thursday from the day before on the Dhaka Stock Exchange.
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