Transcript CAC production/Sales & price

• Historically largest cement producer in Kazakhstan located near
the new capital Astana
• Current production of 0.8 m. tons will increase to over 3 m. tons
once refurbishment exercise is completed
• New production will serve to curb imports in Kazakhstan currently 2
m. tons per year
• Equity listed in AIMS under STCM code since October 2005
• 114 million shares outstanding, market cap approximately $400m.
• Free float 38%
• Bonds listed in the KASE under CACMb1, $21 m. market value
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PRODUCTION, SALES & PRICE
800
10,000
700
9,000
thousand tonnes
Price per tonne Kazakh tenge
8,000
600
7,000
500
6,000
400
5,000
300
4,000
3,000
200
2,000
100
1,000
0
0
2000
2001
2002
2003
Production
2004
Sales
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2005
2006e
Price
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FINANCIAL HISTORY OF CAC / STEPPE CEMENT
2003
US$000
Years ended 31 December
2004
2005
US$000
US$000
6m to
30 June
2006
US$000
Sales
22,003
32,416
49,480
28.600
Gross profit
12,153
19,295
29,320
16.204
Operating profit
6,703
11,035
21,890
10.922
Net finance costs
(307)
(886)
(1280)
(293)
Net other income
1,231
1,636
(105)
830
Profit before tax
7,627
11,785
20,499
11.505
(1,931)
(3,848)
(6,541)
(3.473)
5,696
7,937
13,958
8.032
Tax
Profit after tax
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KAZAKHSTAN CEMENT SUPPLY AND DEMAND
7,000
16%
6,000
6,000
12%
5,000
10%
3,900
4,000
8%
3,002
3,000
2,358
6%
1,969
2,000
4%
1,119
1,000
2%
0
0%
2000
GDP growth
thousand tonnes
5,200
14%
2001
2002
Demand
2003
2004
Supply
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2005
2006e
GDP Growth
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ESTIMATED FUTURE CEMENT CONSUMPTION
10,000
611
568
8,000
600
525
481
500
438
7,000
400
6,000
300
5,000
200
4,000
100
3,000
0
kg per
person
year
thousand tonnes
9,000
700
2007
2008
2009
2010
2011
Year
Cement consumption thousand tonnes
Supply
Kg/person year
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REGIONAL CEMENT MARKET SALES
NORTH
WEST
13%
NORTH
6%
EAST
WEST
CENTRE
30%
CENTRE
SOUTH
EAST
6%
SOUTH
45%
Source: Association of Cement Manufacturers Kazakhstan
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EXPORTERS TO KAZAKHSTAN
Cement Production (‘000 tones)
2006
exports
to KZ
Clinker
Capacity
2003
2004
2005
Russia, Siberia
12,500
~8,500
~9,100
~10,000
1,400
Kyrgyzstan
1,000
800
850
950
200
Uzbekistan
5,100
4,200
~4,400
~4,800
400
500
1,000
1,600
2,000
Estimated exports
to Kazakhstan
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PROJECT SCOPE AND TARGETS
• Refurbished line 6 maintaining
kiln, pre-heater and cooler but
full electrical repairs by ABB
• Change of pyro-processing line
5 by FL Smidth and full
electrical and mechanical
repairs
• Project may be extended to
cover improvements in raw
mills, cement mills, quarry,
compressors and dispatch
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PROJECT ORGANIZATION AND PROGRESS
• New COO, Stuart Elliot ex COO Cimentiere du Liban
• 7 expatriate mechanical and electrical engineers on site with over
200 years combined experience in the cement industry
• Mace UK acting as project manager with 7 employees on site
• PEG, Philips Reamer, FL Smidth
as technical consultants
• 80% of contracts for line 6 and
60% of contracts for line 5 signed
• Objective: to sign all contracts by
end 2006 and complete lines 6
and 7 for the summer seasons
2007 and 2008
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FINANCING
• First share offering completed in March 2006 raised $21 m. in
AIMS
• Bond issue completed in September 2006 for $21 m.
Full disbursement to be completed in November 2006. Trading in
the KASE
• EBRD loan signed in December 2005. Planned to be disbursed in
1Q 2006
• Bridge finance of $46 m. from KKB for suppliers letters of credit
• Income tax exemptions for all new production for 5 years starting
in 2007
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