LAFARGE Cement Zimbabwe will soon comply with the country’s indigenisation laws in a plan which will see the group take on three new shareholding entities comprising the community, employees and the National Indigenisation and Economic Empowerment Fund (NIEEF).
— Staff Writer.
Under the plan, the community, employees and the NIEEF will each get 10% while 21% is already in the hands of local shareholders as the company already trades on the Zimbabwe Stock Exchange (ZSE).
Lafarge said it had agreed with the relevant authorities on the indigenisation plan.
Lafarge, formerly Circle Cement, is a subsidiary of the Lafarge Group, which operates in 64 countries throughout the world. The group owns 76% of the local operations while other foreign shareholders own about 3%. The remaining 21% is owned by locals via the ZSE.
Lafarge also pledged US$3 million as seed capital for the Mashonaland East Community Share Ownership Trust to be divided among the communities the group operates from.
Group managing director Johnathan Shoniwa told a Mashonaland East stakeholders’ meeting the company was committed to the indigenisation programme and would provide funds needed to uplift the community.
He said as a good corporate citizen the company was aware of the grievances of the communities and would strive by all means to ensure the creation of a good partnership with them. Shoniwa also pledged US$70 000 to be used at the official launch of the community share ownership trust.
Lafarge’s main plant is in Mabvuku/Tafara while the group has a mine in Maramba-Pfungwe. Shoniwa said Maramba Mine’s contribution of clinker was around 10%, with the bulk coming from the Manresa Mine. He also said work on the Mazowe site had started.
Meanwhile, the cement maker is targeting a 29% increase in the top line in this financial year after reporting revenue inflows of US$69,9 million in the year to December 2012, an increase of 41% from 2011.
In a trading update for March, Shoniwa said full-year revenue was expected to rise to US$90 million, with individual home builders expected to continue supporting the upward trend.
Shoniwa said the market will continue to be predominantly driven by individual home builders, although there were a number of construction projects in the pipeline, which were expected to boost demand if they materialised.
In the two months to February, demand for cement increased by 6% compared to the same period last year. This resulted in a 7% increase in revenue to US$11 million against US$10,2 million in the comparable period last year.
Shoniwa said in order to grow revenue, the company had impetus on other non-cement products such as aggregates and paints. Year-to-date revenue from these products had improved by 33% compared to same period last year.
Local cement sales volumes in the year to December increased 48% while clinker export volumes declined by 44% as more emphasis was placed on meeting domestic cement demand.