Lanka Cement gets new Board

Lanka Cement Plc has got a new Board including a fresh Chairman, following several resignations.

The company said S.J. Paranagama has ceased to be Chairman/Director whilst N.S.M. Samsudeen has been appointed as the successor with effect from 26 July 2012.

Fellow Directors J. Narabedda, A.M.A.L. Kodithuwakku and K.K. Piyasena have also resigned from the Board whilst the new appointees are L.W. Abeynayake, C.J. Wijesekera, J.K.N.C. Perera and T.M.A. Jayasinghe.

In its filing to the CSE, the company didn’t provide profiles of the new Directors.

In 1Q of FY13, net loss reported by the company was Rs. 5 million, up from Rs. 2.3 million a year earlier, whilst turnover was down to Rs. 28 million from Rs. 56 million. Lanka Cement Plc is saddled with Rs. 1.78 billion worth of accumulated losses, above its issued capital of Rs. 1.73 billion.

State-owned Sri Lanka Cement Corporation holds a 62.45% stake in Lanka Cement Plc whilst the Treasury holds 13%, apart from People’s Bank (6.3%), Bank of Ceylon (5.5%) and CPC (3%).

The changes follow the Consumer Affairs Authority (CAA) in early July seizing a stock of cement at the Sri Lanka Cement Corporation in Panchikawatte. The expired cement had been sold from the warehouse after the expiry date of 12 June.

It was reported that Chairman Paranagama resigned claiming that his name was being tarnished over the alleged incident and there was a conspiracy.

Deputy Minister of State Resources and Enterprise Development Sarath Kumara Gunaratne had alleged that there was a large-scale racket behind attempts to sell some expired cement to the market from Sri Lanka Cement Corporation.

Paranagama, identified as a reputed businessman in the construction and freight forwarding industry and a graduate from the UK, assumed the chairmanship of Lanka Cement Plc in January 2008 when the company had virtually ceased to exist with no sales and staggering liabilities.

The operational loss for 2006 was Rs 21.46 million and Rs 28.3 million for 2007, while 2008 and 2009 had operational profits of Rs 24.1 million and Rs. 9.6 million respectively.

However, with the re-commencement of cement imports in 2008, the company began to make steady progress supplying cement to the State and the private sector.

As per the 2010 Annual Report, Parangama said his vision for the company was to re-commission the cement manufacturing facilities at KKS with a state-of-the-art technology plant. The Harbour View Hotel at KKS too is to be reconstructed to cater to the ever-increasing demand for superior accommodation in Jaffna.

In 2010 net loss was Rs. 32 million, up from Rs. 11.5 million, whilst turnover was down to Rs. 222 million from Rs. 579 million in 2009. In the 31 December 2011 ended financial year, net loss was Rs. 33.7 million, marginally up from Rs. 32 million, whilst turnover had improved to Rs. 296.5 million from Rs. 222 million.