December 7, 2021
Caribbean Cement Company Limited (CCC) has continued to demonstrate its resilience and resolute in meeting its targets. The Company’s performance within the third quarter reflected revenues of $5.5 billion, while revenue for the nine months totaled $17.80 billion, up from $15.10 billion reported a year ago. This translated into a 40% increase in net profit for the period closing at $3.13 billion relative to a net profit of $2.23 billion in 2020. The Company held its 72nd Annual General Meeting (AMG) today, December 7th, 2021 to outline key strategies going forward and to vote on a proposal to enter into certain agreements with CEMEX, S.A.B. de C.V. and its affiliated companies. The agreement wishes to establish the general framework for the corporate services provided by CEMEX to CCCL as well as for the payment of royalties for the use of trademarks, names, and intellectual property owned by CEMEX and licensed to CCCL.
Four strategies of the company:
- Health and Safety: CCC had more than two years free from accidents and will continue to work on in the future.
- Customer Centricity: “Keeping customers at the center of everything we do.” Management aims to make the Caribbean Cement brand more popular. The Company also noted that there has been stronger demand coupled with the different commercial strategies provided by Caribbean Cement to all types of customers. The Company increased its small truck deliveries islandwide by 118% which has helped to dramatically increase quantity demanded.
- Innovation and Sustainability: Reducing Carbon Dioxide emissions has become more and more important worldwide. CCC noted that “We want to lead this part in reducing carbon footprint and decarbonizing industrial activities and promoting the green economy.” The CCC has signed a Memorandum of Understanding with the Government this year and will safely dispose of tyres from Riverton Landfill and utilize these as an alternative fuel to the production process at the CCC’s plant.
- EBITDA Growth towards Investment Grade
CCC’s Achievements:
- 18000 shareholders
- 250 full-time Jamaican employees
- 453 local suppliers in 2020
- 70% of purchases from local suppliers in 2020
- 5% less fossil fuel usage for the period 201-2020
- +220 Communities have benefited from Corporate Social Responsibilities (CSR) with $171 million invested in CSR projects from 2018-2020
- There have been $3.8 billion invested in the company from 2018 to 2020.
Outlook
Dividend Policy:
Trinidad Cement Limited, CCCL, and CEMEX have placed on record their support of the development of a dividend policy that will assist the company in having a framework, administration, declaration, and payment of dividends to its shareholders. BOD of the company should be in a position to submit to the shareholders the approval of the declaration of a dividend at the next AGM.
Special Business:
The resolution is to authorize the company to enter into a master services and intellectual property agreement and two sub-agreements with CEMEX, S.A.B. de C.V, the ultimate parent company of CCCL and its affiliated companies (collectively referred to as “CEMEX”). This is to establish the general framework for the corporate services provided by CEMEX to CCCL as well as for the payment of royalties for the use of trademarks, names, and intellectual property owned by CEMEX and licensed to CCCL. The cost to the Company is up to 4.0% % of CCCL’s revenue.
According to an addendum posted on the company’s website, CCCL has benefited from best practices and expertise since 2017. During the Post-Merger exercise, the goal was to improve the financial position of CCCL while navigating through a challenging financial situation. The main objective was to evaluate the models and determine if they provided real savings and benefits before entering into formal contracts. According to the Company, the proposed agreements should have been implemented in 2020, 2021, or even 2022, based on the COVID-19 global pandemic. However, since the implementation was delayed due to the global pandemic, it was decided to delay the implementation until January 2022.
A shareholder poll was conducted, and the resolution was adopted with 91 percent voting in favor of the proposal.
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