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Fujairah Cement Industries’ accumulated losses have reached more than a third of the manufacturer’s capital due to inflation and lower revenue.
Total accumulated losses for the financial year 2023 stood at 130.5 million dirhams ($35.5 million), representing 36.68% of the capital, according to a disclosure on the Abu Dhabi Securities Exchange (ADX) on Tuesday.
The UAE-based manufacturer said it has seen a “significant increase in the losses” due to several factors, including increased cost of coal/ energy, lower selling prices of clinker, decline in revenue, and increased logistics and finance costs, among others.
The company, which mainly manufactures cement and clinkers, is in advanced discussions to engage a reputed financial advisor to assist with the restructuring process and explore other potential options, to address the losses.
“The major challenge during the year was the higher production cost due to the rising coal and fuel prices,” according to a separate disclosure.
“In response to the challenge, the Group’s management was able to increase the rate of cement in both local and international markets. The management is also exploring entry to other markets outside the UAE to maximise the capacity utilisation.”
(Writing by Cleofe Maceda; editing by Brinda Darasha)
