In 2010 we dispatched just under 890 000 tons of cement, an increase from the previous year’s 706 000 ton. This represented a growth of 25% while the total market grew by only 14%.

The suspended import duties for cement have still not been reinstated, resulting in the import of heavily subsidized cement, mainly from Pakistan. The poor supply of electricity from Tanesco continues to be a major area of concern as it forces us to use our backup generators, increasing our production cost substantially.

The collapse of the railway services in the first half of 2010 had a dramatic negative impact on our distribution cost, as almost all cement transported to the Lake District and beyond had to be transported by road at a substantially higher cost.

Despite the 24% growth in sales revenue during the year, operating
profit grew by only 5% due to these constraints.

The positive market growth is expected to continue over the next few years, but at a slightly lower rate of 7% to 10 % annually.

With additional cement capacity expected to come on stream in the region and with further development towards the creation of a truly common market in East Africa, there will be increased competition over the next few years. This will put margins and sales volumes for the whole industry under increased pressure. For companies able to adapt to the new market situation, however, there will also be new business opportunities.

With modern production facilities, dedicated and well trained staff and with a very high quality image through the Simba brand, TCCL is well positioned to meet these challenges.

The acquisition of a majority share in Cement Distributors (EA) Ltd resulted in TCCL becoming the only cement manufacturer in Tanzania to control its own supply process from mining of raw materials through manufacturing, packaging and transporting to the final destination.

Future development is, however, subject to policies, actions and political will from the establishment to help create a fair business environment.

Government commitment to long-term policies, clearly communicated, is needed by the cement industry to ensure continued development and investment for the future.