{"id":6565,"date":"2021-12-15T18:11:53","date_gmt":"2021-12-15T18:11:53","guid":{"rendered":"https:\/\/www.africa-press.net\/rwanda\/all-news\/exclusive-how-did-cimerwa-plc-fetch-rwf67-3b-in-a-pandemic"},"modified":"2021-12-15T18:35:12","modified_gmt":"2021-12-15T18:35:12","slug":"exclusive-how-did-cimerwa-plc-fetch-rwf67-3b-in-a-pandemic","status":"publish","type":"post","link":"https:\/\/www.africa-press.net\/rwanda\/all-news\/exclusive-how-did-cimerwa-plc-fetch-rwf67-3b-in-a-pandemic","title":{"rendered":"Exclusive: How Did CIMERWA Plc Fetch Rwf67.3B In A Pandemic?"},"content":{"rendered":"

Africa-Press – Rwanda. <\/strong><\/span>Do you understand how difficult it is to achieve meaningful milestones in the most frightening and stressful moments? Perhaps yes, everyone can easily say how hard it is. But what we can\u2019t easily explain is how one can achieve positive results in a pandemic, where hopes and plans are shattered.<\/p>\n

Now, one of the companies that made impressive and surprising milestones, albeit, is a cement company, CIMERWA Plc. Here is the story. The pandemic almost sealed off some companies on the market, but CIMERWA Plc managed to draw strategies that helped the company to weather the storm.<\/p>\n

It set strategic initiatives that closed loopholes and opened new value fronts. Results? Generating Rwf63.7 billion, an increase of 7% compared to the previous year and a Profit After Tax of Rwf4.2 billion mirroring a 111% increase compared to the previous year.<\/p>\n

The company also managed to record Profit Before Tax of Rwf 5.4 billion at a +179% increase compared to the previous year. Following the company\u2019s listing on Stock Market last year, the company registered such a performance when many other companies were falling off the cliff.<\/p>\n

Closing the financial year recently, Albert Kipkemoi Sigei, the CEO of the CIMERWA Plc, told Taarifa in an exclusive interview (watch the full interview at the end of this article) that the profit earnings came following its listing on the stock exchange market which is a gesture that puts a smile on the shareholder\u2019s faces.<\/p>\n

\u201cIndeed, the results show growth and resilience. We are very proud of these numbers,\u201d he said happily.<\/p>\n

He disclosed that the strategies behind the successes were because of the targets that the company set during the difficult times of COVID-19, including those related to clarity of purpose that aimed at building a better lives in general and strengthening Rwanda.<\/p>\n

\u201cIt doesn\u2019t mean that we were not impacted but, to a large degree, we were able to mitigate the effects by introducing appropriate strategies,\u201d Sigei says.<\/p>\n

Like other businesses, during COVID-19 times, the supply chains and distribution channels were affected but the company had to make sure that cost management and cash preservation models are applied to survive the uncertainties brought by COVID. The company made the best of the 7% sales growth compared to previous years, with its cost of sales being remarkably contained to a 0% flat increase, thus enabling the more than 100% profits increase.<\/p>\n

\u201cOur cost performance was on account of improved operational efficiencies, innovation and a cost savings program. For example, we rely on coal for heating, so we increased the proportion of alternative fuels that are not only cost-effective but also more environmentally friendly. Energy, logistics and clinker factor are some of the most expensive components in cement production. We worked on these to make sure that the company lowers the cost of production,\u201d the CEO says, nodding suggestively that the strategy yielded positive results.<\/p>\n

For the company to achieve such abnormal profit growth, the administration was able to strategize the operations and increase its export portfolio as well as exploit innovation. For example, improving plant reliability and reducing the level of energy consumption during production.<\/p>\n

As far as corporate governance framework is concerned, the company placed a binoculars on its policies and procedures, including procurement to ensure that it gets the best value for money when it comes to transportation, energy, spare parts and other cost lines.<\/p>\n

Notably, though, the CEO was supported by a strong and highly experienced new board backed by independent directors and an enhanced management capacity, reckoning that these were the engines behind the good performance.<\/p>\n

\u201cThe team was foresighted enough to make clear decisions at difficult times despite the harsh environment,\u201d Sigei says, adding that \u201cwhen COVID-19 was fresh it wasn\u2019t easy for companies to forecast the way forward and no one had certainty but the team remained calm and focused.\u201d<\/p>\n

It was such a difficult moment with the company having overdrafts and long-term loans with the banks, Sigei remembers. \u201cThe effects of the pandemic forced us to negotiate with banks on loan repayment moratoriums, invoke force majeure on some contracts while taking other bold decisions. I am glad that we have come through this and now have a healthy cash and liquidity position,\u201d he says.<\/p>\n

As a response to COVID-19, CIMERWA Plc also adapted to virtual meetings, accelerated systems automation and made sure that it moved faster on technology exploitation.<\/p>\n

Difficult times and mitigation strategies<\/b><\/p>\n

The fiscal year 2020 was a bad year for Rwanda with a GDP growth rate declining to -3 %. This consequently affected demand in the construction sector, particularly the trade segment. The Company appreciates the interventions taken by the Government to stem the impact of this dip, including commencement of major projects which mitigated the effects of COVID. The Company complemented this by increased focus on segment such as exports and major infrastructure projectse.<\/p>\n

According to economists, Rwanda\u2019s domestic market during the pandemic was flat and it was not easy for CIMERWA Plc had to dig deep to find new channels for its products.<\/p>\n

\u201cWe had to grow new markets during the year that we were able to increase the export volumes to Goma, Northern Kivu, strengthening our foothold in Bukavu and because of this, exports contributed to 19% of our total sales volumes compared to the contribution of the previous year at 15%,\u201d he says.<\/p>\n

Strategically, the company also focused on key construction projects segment with some major projects in the pipeline having commenced in high gear ; such as Bugesera Airport construction as an anchor project, power projects, school construction and roads construction.<\/p>\n

\u201cWe are positioning ourselves for growth and increasing demand and hence continue to focus on plant operational efficiency and addressing remaining capacity bottlenecks. We have set investments plans and innovation for further improvements. I am also happy to note that we fully satisfied Rwanda\u2019s domestics requirements and close the year with healthy stocks levels in readiness to service major projects in the pipeline,\u201d he notes.<\/p>\n

Future<\/b><\/p>\n

Plans After such a profitable year, the company wants to maintain the position through its strong board and management and strong SIMANYARWANDA brands.<\/p>\n

Through its listing prospectus, there is the expectation of performance improvement, profitability and bringing down the debt. The job for Sigei and his team is to meet the targets by 2024 at which point the existing long-term debt will be extinguished.<\/p>\n

The company has also been engaging customers by visiting construction sites as well as sharing ideas about the design of the products and doing calculations at the sites together in order to provide solutions to customer challenges.<\/p>\n

Quality Products<\/b><\/p>\n

While keeping an eye on quality, CIMERWA Plc is known for quality cement, a factor that contributes to its supply chain and logistics. In May last year, the firm launched diversified products through its SURE range of products. This includes SURECEM, intended for general purposes and SUREWALL for plastering and brick joining which is cheaper, at Rwf7,800 compared to other types that cost about Rwf9,000. The company also offers SUREBUILD which is targeted at high-strength heavy construction and SUREROAD designed for road construction.<\/p>\n

Corporate social responsibility<\/b><\/p>\n

As a part of its strategy, CIMERWA Plc focuses on the health, safety and environmental protection. Company officials believe it is a priority to make sure that employees, partners and the community are healthy and safe.<\/p>\n

\u201cIf you are taking care of the environment and community, then operations will be sustainable and I think this is important because the community and stakeholders trust the company for taking to care for their wellbeing,\u201d the CEO explained.<\/p>\n

CIMERWA Plc has over the years impacted the surrounding communities positively. It has constructed and supported a school, clinic, water treatment plant, tailoring co-operative amongst others.<\/p>\n

While all these developments ensued, the company has achieved close to 100% vaccination of its staff to achieve its commitment to creating a healthy and safe working environment. It has also supported its operational partners and the community to receive vaccination in collaboration with the relevant authorities.<\/p>\n

\u201cI have no doubt that when we speak again, twelve months from now, we shall have another brilliant story from CIMERWA Plc,\u201d Sigei says, shortly before he flew to Nairobi, Kenya for his holiday. Watch full interview below:<\/p>\n

For More News And Analysis About Rwanda<\/a> Follow Africa-Press<\/a><\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"

Africa-Press – Rwanda. Do you understand how difficult it is to achieve meaningful milestones in the most frightening and stressful moments? Perhaps yes, everyone can easily say how hard it is. But what we can\u2019t easily explain is how one can achieve positive results in a pandemic, where hopes and plans are shattered. 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