… claims its officials

Cement: Despite facing numerous technical challenges, embezzlement cases, losses and other challenges for the last couple of years, Dungsam Cement Corporation Ltd (DCCL) officials claim the company has been doing well since last year.

This, they claim, is as per the company’s operational highlights report.

Officials say the company saw good sales and increases in revenue generation in 2016 compared to 2015. However, the company is yet to “come out of the losses” it has incurred over the years.

Officials say the company generated a sales revenue of Nu 1,598 million (M) in 2014 while in 2015 it generated Nu 2,579.43M. The company made Nu 3,400.42 million last year.

The company’s deputy managing director, Karma Gayleg, said the gradual increase in the sales revenue was a sign of improvement. “That motivated management to work hard this year to come out of the loss.”

He said apart from concentrating on the revenue and sales, their main objective is to make sure the plant doesn’t shut down and maintain the quality of its cement this year.

“We hope the upcoming hydropower projects help to increase the sales apart from the regular sales to Punatsangchhu I and II, Mangdechhu hydropower project and markets in India.”

Records show a total of 194,571 metric tonnes (MT) of cement was sold in 2014 where as in 2015, it was 454,099MT. In 2016, it increased to 574,066MT. It also showed the expenditure increased from Nu 2,885.84 million in 2014 to Nu 4,088.53 million in 2016.

Karma Gayleg said although they saw an increase in sales in 2015, there was no net realisation (average price of the cement per metric tonne) because the expenditure increased  and the plant was shut down for about three months owing to various circumstances.

“But we operated more than 10 months in 2016 excluding one month when we closed for regular maintenance as per the norms,” he said. “So there was an increase in the expenditure on consumption of raw materials. Though we managed to contain the expenditure, we still could not come out of the losses.”

However when compared to the revenue earned, despite several trials, the company was still under loss. But the deputy managing director claimed since they managed to reduce losses by half last year, they are confident that this time they would be able to recover the losses fully as committed.

“Status is improving based on the perceptible interim figures, revenue wise and plant performance wise,” Karma Gayleg claimed. “We just need to motivate our employees on the moral responsibility and work hard to achieve a drastic improvement this year.”

As for the plant production capacity, the company has also been doing fairly well compared to 2014 until last year except due to plant breakdown in 2015, the company sold clinkers more than the cement.

The company, however, managed to pick up last year and sold an additional 569,410MT of cement compared to 200,181MT in 2014 and 471,369MT in 2015. The clinker and limestone production also increased over the years.

Karma Gayleg said this year they are also working to make sure the plant is available for more than 80 percent for operation and to utilise the plant fully as the plant availability has improved since last year.

“If we are not able to sell the product even if the plant is in running condition, the plant becomes under utilised,” he said. “Besides being new in the market, we also have to compete with large markets in India and internationally, making it difficult to sell cement.”

Meanwhile, although the company has the capacity to sell 3,000MT of cement in a day, they sell only about 1,000MT of cement to hydropower projects a day and export only about 300MT.

Yangchen C Rinzin | Nganglam