After it was forced to embark on comprehensive restructuring last year, the St Lucy-based Arawak Cement Company Limited is reporting a financial turnaround.
In a statement yesterday, the company did not release any hard data but it said despite added competition in the local and export markets, its earnings before interest, tax, depreciation and amortization (EBITDA) had increased last year.
Described 2015 as a “very encouraging” year, the former monopoly cement provider for the island also reported improved operational efficiencies and a 20 per cent increase in exports, compared to 2014.
Chairman Arun Goyal said the improved performance came as a direct result of strategic initiatives, as well as “an adherence to the core objectives of sustainability and competitiveness as our driving force”.
He expressed appreciation to employees, trade unions, distributors, consumers, bankers and industry captains for their support, saying without them, “we would not have been able to accomplish what we did”.
Last October, 40 workers at the Checker Hall, St Lucy plant were made redundant as part of a comprehensive restructuring plan which the company said was designed to save the operation from going under.
The then General Manager Rupert Greene had explained at the time that Arawak had been recording significant losses since 2008, while its cost of production was significantly higher than that of other subsidiaries in the Trinidad-based TCL Group.
Greene had also identified the high cost of energy and labour as the two largest components affecting the company’s performance, saying its viability was at risk unless the current mode of operation was significantly transformed.
At the start of the year, Greene was replaced by Manuel Toro, a Stanford University-trained mechanical engineer, who admits that harsh measures had to be taken.
However, Toro said they were necessary for Arawak to become competitive.
Under his management, the company is planning to invest more than $20 million over the next three years in manpower training and equipment upgrades aimed at reducing unscheduled plant stoppages by 33 per cent, enhancing its production efficiency by over ten per cent and improving its carbon footprint.
“At Arawak, we are focused on adding value to the construction industry and are currently considering diversification and the opening of new business lines,” Toro said.
“We are also guided by the pillars – Safety and environment as our top priority, business sustainability and of course, delivering quality and freshness in every bag of Arawak Cement,” he added.
The 35-year-old company has also embarked on an aggressive export programme, targeting doubled revenue from exports in under two years, from which Barbados is expected to reap tax benefits and earn vital foreign exchange.
However, it now faces stiff competition from the Mark Maloney-led Rock Hard Cement, which entered the domestic market last November and is already taking credit for a drop in the price of the product on the market, as well as an improvement in quality.
In an exclusive interview with Barbados TODAY last month, Maloney said cement prices had dropped by 30 per cent since his company came on the scene from US$220 per tonne to US$160 per tonne.
At the same time, the prominent businessman said there has been an improvement in the quality of both the product and customer service.