Hard times for TCL
Plant “difficulties” at its Barbados operation is among a series of challenges making life hard for regional manufacturer Trinidad Cement Limited.
The enterprise based in Trinidad and Tobago has been faced with financial hurdles, which impacted its operations there, in Jamaica and the Arawak Cement Company Limited here.
With the company’s annual shareholders meeting scheduled for October 12 in the twin-island republic, Group Chairman Andy Bhajan and Group CEO Dr. Rollin Bertrand recently reported on the difficulties that faced their organisation, although they pointed out that the $789 million in group revenue recorded in the first half of 2012, was a $29.5 million (3.7 per cent) increase over the comparative period in 2011.
But high prices and not increased production was the major factor behind this increase since, as the two officials pointed out “domestic and export cement volumes were five per cent and 24 per cent respectively lower than the prior year comparatives”.
“The Trinidad and Barbados markets saw volume declines of 12 per cent and 11 per cent respectively due to soft demand whilst the lower exports were due to reduced production as a result of the labour strike in Trinidad and plant difficulties in Barbados,” they reported.
Bhajan and Bertrand also noted that as a result of a crippling general labour strike at TCL’s Trinidad plant between February 27 and May 26 this year export sales from that market were not possible.
This was compounded by the fact that the other plants in Jamaica and Barbados “were not able to achieve expected production levels, suffering numerous breakdowns, due to inadequate spares as a result of a lack of working capital”.
The two spokesmen noted, however, that “the working capital difficulty was remedied in the last week of June with the execution of two sales contracts which resulted in advanced payments of US $12 million into the group”.
“The group incurred additional restructuring expenses of $40.3 million in the six months as the execution of the debt restructuring agreements did not take place until May 10 and all conditions precedent satisfied until June 15. These expenses have to be recorded in the month in which the legal and other advisory services are rendered,” they said.
The two expect an improved 2012 second half performance now that TCL’s debt restructuring had finished.
“The group has refocused on its businesses in a still challenging environment. The receipt of the advanced payments will enable critical plant refurbishment to take place so that plant performance will improve,” they stated. (SC)