Annual Report and Financial Statements
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Annual Report and Financial Statements www.lafarge.co.ke Setting Industry Standards in Health & Safety BAMBURI CEMENT LIMITED Corporate Office, Kitui Road, Off Kampala Rd, Industrial Area, Nairobi. P.O Box 10921 - 00100, Nairobi. Tel: +254 (0) 20 2893000 / 6614358 / 722 202941 / 720 205471 Email: [email protected] Website: www.lafarge.co.ke BamburiCement BamburiCementLtd.LafargeHolcim ANNUAL REPORT AND FINANCIAL STATEMENTS 2020 Contents Who We Are 5 About Bamburi Cement Group 7 About LafargeHolcim 8 Our Brands 10 2020 Overview 15 Over the years we have championed Group - Key Financial Highlights 16 Value Added Statement 17 Chairman’s Statement 18 road safety by training long distance Group Managing Director’s Statement 22 Board of Directors 26 truck drivers and motorbike (boda Executive Committee Members 31 boda) riders as well as creating Business Overview 33 Operational Review 34 Marketing Highlights 42 awareness countrywide Health and Safety 46 Our People, Culture and Systems 50 Risk and Control 56 Sustainability Review 59 Our Sustainability Framework 60 Communities 63 Climate 69 Environment 70 Circular Economy 72 Governance 75 Corporate Governance Statement 76 Governance Auditors Report 81 Statement of the Directors on Governance 82 Directors’ Remuneration Report 83 Shareholder Profle 86 Financial Review 89 Corporate Information 90 Report of the Directors 91 Statement of Directors’ Responsibilities 92 Independent Auditors’ Report 93 Consolidated Statement of Proft or Loss and Other Comprehensive Income 97 Company Statement of Proft or Loss and Other Comprehensive Income 98 Consolidated Statement of Financial Position 99 Company Statement of Financial Position 100 Consolidated Statement of Changes in Equity 101 Company Statement of Changes in Equity 102 Consolidated Statement of Cash Flows 103 Company Statement of Cash Flows 104 Notes to the Financial Statements 105 Integrated Reporting: This report applies the principles of Integrated Reporting to show how we manage the company sustainably, as well as the fnancial and non-fnancial value we created in 2020. BAMBURI CEMENT ANNUAL REPORT & FINANCIAL STATEMENTS 2020 3 Who We Are As a leading cement and concrete producer in East Africa, Bamburi Cement Ltd is at the forefront of innovation in construction, driven through high performance, new technologies, and sustainable building and construction products and solutions. Our products and solutions support nation building. We are here to help the world build better. Our Vision To be the undisputed leader and the preferred partner by providing innovative solutions for nation building Our Strategy: Building for Growth is based on 4 pillars Growth Proftable Growth ahead of market Performance Be the best cash cost company in the country through innovation & operational excellence People Become an agile, lean and performance focused organization by empowering our people Sustainability Be the most respected company by all stakeholders by creating shared value with them Approved Personal Protective Equipment (PPE) must be worn at all our sites by staf and visitors alike. BAMBURI CEMENT ANNUAL REPORT & FINANCIAL STATEMENTS 2020 5 Setting Industry Standards in Health & Safety About Bamburi Cement Group Bamburi Cement Ltd A subsidiary of LafargeHolcim, the world’s global leader in building solutions, listed in the Nairobi Securities Exchange. The company runs two cement plants, based in Mombasa and Athi River, from where it serves the market in Kenya, the region and export. Bamburi Special Products Ltd A supplier of quality Ready Mix concrete and Precast concrete blocks with operations in Nairobi and Mombasa. KENYA Lafarge Eco Systems Ltd The environmental arm of Bamburi Cement Ltd whose operations are in sustainable land use and quarry rehabilitation. Binastore Ltd A one-stop shop for a wide range of construction products, solutions and expertise to support customers in their construction needs. Hima Cement Ltd A subsidiary of Bamburi Cement Ltd with two plants in Kasese and Tororo. Management conducts annual plant audits to UGANDA review and update our Health and Safety systems. 6 BAMBURI CEMENT ANNUAL REPORT & FINANCIAL STATEMENTS 2020 BAMBURI CEMENT ANNUAL REPORT & FINANCIAL STATEMENTS 2020 7 Setting Industry Standards in Health & Safety About LafargeHolcim Key Grinding plant Europe Cement plant 7,061m Net sales (CHF) 2019: 7,670m North America 5,749m Net sales (CHF) 2019: 6,311m Asia Pacific 5,243m Net sales (CHF) 2019: 6,491m Middle East Our global presence & Africa Our business segments We have the largest global Latin America 2,349m Net sales (CHF) Cement Ready-Mix Concrete footprint in our industry 2,225m 2019: 2,903m Net sales (CHF) 190.4 42.3 2019: 2,620m with a presence in around 70 Sales (million tons) Sales (million m 3) 2019: 207.9 2019: 47.7 countries across the world. Aggregates Solutions & Products 256.3 1,893m Sales (million tons) Sales (CHF million) 2019: 269.9 2019: 2,248m Find out more: www.lafargeholcim.com/where-we-operate 8 BAMBURI CEMENT ANNUAL REPORT & FINANCIAL STATEMENTS 2020 BAMBURI CEMENT ANNUAL REPORT & FINANCIAL STATEMENTS 2020 9 Setting Industry Standards in Health & Safety Our Brands We offer the widest range of innovative application-based products and solutions specifically designed to meet different construction requirements, in response to our customer needs. 10 BAMBURI CEMENT ANNUAL REPORT & FINANCIAL STATEMENTS 2020 BAMBURI CEMENT ANNUAL REPORT & FINANCIAL STATEMENTS 2020 11 Setting Industry Standards in Health & Safety Our Brands continued Haller Park A world famous ecological and ecotourism showcase which was once a Bamburi quarry wasteland and was rehabilitated into a rich diverse tropical ecosystem. Bamburi Haller Park is a recreational hot-spot ideal for experiential learning and serene outdoor experiences. It ofers a variety of attractions to educate, raise awareness and entertain visitors; and is home to a diverse range of wild animals. Forest Trails A verdant cool forest with open grasslands and ftness trails transformed from a Bamburi quarried barren landscape. It’s cool, serene and fresh ambience, free from noise, makes it an ideal destination for outdoor activities, events and excursions. The ftness trails are used for leisure walking, jogging and cycling. Bamburi Readymix Concrete BamburiBlox Pre-mixed concrete delivered to customer sites as ready to use High quality precast concrete paving blocks construction product. that ofer quality paving solutions. We have a variety of designs and aesthetics to cater for diferent tastes. Ofers sustainable waste management solutions to industries and municipalities. Disposal through co-processing in cement kilns; a Bamburi Precast Mould safe and more responsible solution to waste management. A variety of pre-cast mould concrete products for diferent applications ranging from block drainage, hollow blocks, road kerbs, edge restraints to fencing products among others. 12 BAMBURI CEMENT ANNUAL REPORT & FINANCIAL STATEMENT 2020 BAMBURI CEMENT ANNUAL REPORT & FINANCIAL STATEMENT 2020 13 2020 Overview Group - Key Financial Highlights 16 Value Added Statement 17 Chairman’s Statement 18 Group Managing Director’s Statement 22 Board of Directors 26 Executive Committee Members 31 Defence against Covid-19: We ensured all staf had access to face masks and donated reusable masks to vulnerable communities. 2020 OVERVIEW BUSINESS OVERVIEW SUSTAINABILITY REVIEW GOVERNANCE FINANCIAL REVIEW Setting Industry Standards in Health & Safety Group - Key Financial Highlights Value Added Statement Group Turnover - Kes Million Group Profit before tax - Kes Million 8,271 38,034 37,262 36,796 35,974 34,884 16,773 14,214 14,578 16,380 14,214 Revenues Banks Payment to Governments 4,116 34,884M Kes 62M Kes 3,368M Kes Customers are at the heart of We create value for our fnancial By working closely with both National 23,048 22,218 1,776 21,261 19,594 20,670 our business. We understand our services providers through the and County governments, we bring the 620 728 local markets and strive to exceed fnancial product and services benefts of private sector operation; our customers’ expectations. we access from them enabling providing revenue for the exchequer 2016 2017 2018 2019 2020 2016 2017 2018 2019 2020 We are concerned with providing us to fnance our operations and through various taxes and payments and infuencing practices in the Uganda Kenya Total Group our customers with the highest investments. construction sector through policy quality products and respond dialogue and sharing of our experience appropriately to their concerns. and expertise. Group Profit attributable to shareholders - Kes Million Group Earnings and Dividend per Share 14.44 12.00 5,243 5.10 4.54 4.00 1,647 3.00 2.89 1,051 2.37 Shareholders Suppliers Our Employees 861 633 1.74 - (Dividend) 28,138M Kes 2,979M Kes 2016 2017 2018 2019 2020 2016 2017 2018 2019 2020 - We work collaboratively with Our employees drive our business. EPS (Kes per share) DPS (Kes per share) We provide shareholders with several strategic suppliers. We We strive to create a diverse open and transparent information cascade our high business and inclusive workplace where and encourage two-way conduct through these all our colleagues can reach communication while observing relationships. We ensure that their full potential while providing Group Cash and cash equivalents- Kes Million Employee Numbers the highest standards of corporate we treat our suppliers with the competitive remuneration and governance and ethical business utmost respect and encourage benefts and prioritizing their health co-creation. and safety 6,972 practices. 6,387 802 808 822 729 720 331 347 352 326 346 3,490 3,106 2,366 471 461 470 403 374 2016 2017 2018 2019 2020 2016 2017 2018 2019 2020 Communities Net Capital Out Flows Retained for Uganda Kenya Total 21M Kes 1,085M Kes Sustainable Growth We seek to create social, We are consistently improving 6,251M Kes environmental and economic our productive capacity through Cash retained for sustainable benefts for communities where we investments in machinery, operations in our business. operate. equipment, technology and other assets so as to maintain our competitive advantage.