TWIGA - Un-audited Financial Results Six Months Ended 30 Jun 2013

Chairman’s Statement

 Tanzania Portland Cement Company Limited (TPCC) recorded revenues of TZS 102bn in the first half of 2013.  This is a decrease of 20% compared with the same period in 2012.  The decrease in revenue is mainly due to decrease in sales volumes.  These were largely impacted by the increased quantities of imported cement from Pakistan, allegedly caused by under-declaration of values and quantities leading to non-payment of statutory taxes and duties by the importers.

 In May 2013, operations were also severely affected by a fire that destroyed the main transformer feeding electrical power to the plant.  This led to the need of using imported clinker and also to rent and operate electricity generators.

 Prospects

 The Company expects better results in the second half of the year.  Reduced competitiveness of imported cement when adequate taxes and duties are paid coupled with the installation of a new transformer at TPCC in the third quarter of the year will lead to a much more conducive commercial and operational environment.

 With the proposed start-up of the Aggregates business in the second half of the year and completion of the investment in Cement Mill 5 next year, TPCC will be in the best position to take advantage of the expected increase in demand for building materials in the sub-region.

 Dividend

 The new investments will require financial resources over the coming months.  The Board is therefore not recommending interim dividends.

 BY ORDER OF THE BOARD

  

Jean-Marc Junon

Chairman of the Board

22 August, 2013