Cement prices going up again?

Caribbean Cement Company might be raising their prices again soon, as the company tries to combat rising inflation and increasing electricity costs.

Business journalist at the Jamaica Observer, David Rose told Taking Stock with Kalilah Reynolds that there has been speculation that Carib Cement will be raising its prices again, as early as this month. This would be the second price increase in less than six months.

Carib Cement is owned by Trinidad Cement, which is in turn owned by a Mexican company, Cemex – Cemento Mexico.

Carib Cement, which is Jamaica’s largest supplier of cement, made headlines last year when Cemex announced that it would charge the company royalties to use its trademarks and other intellectual property.

Shortly afterward, Carib announced that it would be increasing its prices by eight percent. The increase took effect in January, however, the company denied that the two things were connected.

The company reported a 14 percent increase in revenues in their first quarter (Q1) results and a four percent increase in net profits, which analysts say could have been higher

According to the company’s Q1 results, it paid roughly two percent of its overall revenue or $133 million in royalty fees to Cemex.

According to Investment and Sovereign Risk Analyst at JMMB Group, Leovaughni Dillion, this stunted the company’s performance.

“If you add that back, assuming everything else including taxes etc are equal, you’d be looking at about a 13 percent increase in profits but instead you got four percent,” he said.

The company also faced a major hit in the costs of electricity and fuel, which were up approximately 19 percent when compared to Q1 of 2021. Dillon said that this should not come as a surprise as gas prices have skyrocketed since then.

In fact, the increase in fuel prices was listed as one of the main reasons for January’s price increase.

Rose also noted that the company has yet to disclose if the increase in revenues was a result of the price increase or increased cement sales.

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Sashell Williams2024-09-03T21:40:31-05:00