Carthage Cement Achieves Net Profit of 55,193 MTND
Last week, Carthage Cement announced a net profit of 55,193 MTND, an excellent performance for the cement company, which has managed to resist despite a long and difficult journey.
The company, which started with great fanfare thanks to its close ties to the power of the time, subsequently sank into a series of strikes and difficulties. Under the aegis of Al Karama Holding, it has been able to gradually recover. We believe this is one of the best achievements of the asset manager since its creation.
Since last year, all previous losses have been absorbed. However, there are still deferred depreciation of 285,768 MTND to be absorbed. The time has not yet come for dividends, but the improvement in the financial situation is undeniable. As of the first quarter of 2024, the debt stood at 322,432 MTND. For comparison, five years ago, its debt was 518,708 MTND. This has allowed for a reduction in financial charges and a boost to profits.
The big question now is: would it be wise to sell the company? The processes that have taken place have not been successful for various reasons. Since then, the valuation of the cement company has improved, and from the point of view of achieving objectives, the sale could this time be successful with an attractive price. However, with the new approach of the government, it is unlikely that the executive would sell a company on the right track, at least for now. Nevertheless, the ambitions are high this year, with 520 MTND to be collected from confiscated assets as a target in the 2024 Finance Law. Probably, there are other assets whose sale is planned and could bring in as much money.
Overall, and given that other public cement companies are losing money, we believe it is logical to keep Carthage Cement to balance sectoral exposure. In any case, this remains a sovereign decision that follows a logic set by the government. The question will certainly be raised by shareholders at the next General Assembly.