Kampala, 28th June, 2018: The Board of Directors Uganda Clays Limited is pleased to announce that the company again posted good results for a second year in a row thus enabling sustained shareholder value and a dividend pay off. The company posted a 4.5% growth in revenue during the year from Uganda Shillings 26bn in 2016 to 27.2bn in 2017.
This remark was made at the Annual General Meeting (AGM) held at Sheraton Kampala Hotel. This set of performance was amidst a very challenging and competitive environment, prolonged drought with eminent famine, the unsettled civil conflict in South Sudan, the depreciating shilling value, increased cost of petroleum products, and a general increase in labour costs.
The gross margin on the other hand, was relatively the same in comparison to the previous year (2017: 39%, 2016: 40%). This is attributed to the general increase in prices in the economy, more specifically major factory inputs such as steel, imported spare parts, fuels and lubricants.
Speaking at the AGM, Uganda Clays Managing Director Mr. George Inholo said, “The Company continued to focus on staff motivation campaigns, as well as intensifying sales and marketing activities to grow revenues by opening up new outlets in priority markets translating into improved productivity and profitability.”
Part of this staff motivation has been achieved through a restructured Human Resource Charter hinged on a great performance culture and commensurate reward and compensation scheme. This is effectively achieved through our newly installed Enterprise Resource Planning (ERP) system which provides a robust, integrated and continuously updated view of the core business processes.
The company also imported machinery to ensure sustained non-stop production. A case in point is the Kamonkoli branch in Mbale District which is the only semi-automated clay manufacturing plant in East Africa. Deployment of such technology results in minimized interface between products and people during operations thus ensuring high quality production.
The branch has an inbuilt system that allows for accurate clay mixing in the required ratios and controls at each stage of the production process.
This mode of operation is in line with the year’s theme, “Appreciating the Use of Advanced Technology in the Clay Manufacturing Processes.”
Fred Kimbugwe, the Factory Manager-Kamonkoli highlighted that, “The improved technology enables us meet the ever-growing market demand because the machines run 24 hours a day.”
He adds that, “Through this we are accruing savings by converting from furnace oil to coffee husks during the baking process.”
Furthermore, in 2016 its largest debtor, NSSF, waived interest on the Shs11.05bn loan it had given to UCL in 2010. The two entities are in negotiations for NSSF to turn the loan and interest into equity, a position expected to help UCL scale even further heights. Uganda Clays provides 55 per cent of all baked clay building products used in Uganda, according to its annual report.