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Highlights:
- Revenue Recovery: Steppe Cement posted a 7% revenue increase in Q3 2024, reducing its year-to-date decline to 2%.
- Volume and Pricing Growth: The company saw a 5% rise in volumes and a 2% increase in prices, supported by higher production levels.
- Share Price Surge: Steppe Cement's shares jumped 19% following the positive trading update, reflecting renewed investor confidence.
Steppe Cement (LSE:STCM), a Kazakhstan-focused cement supplier, has made a strong recovery following a profit warning issued last month. In the third quarter of 2024, the company reported a 7% rise in revenues to approximately US$32 million, which helped reduce the year-to-date revenue decline to just 2% at US$67 million. The company saw positive momentum in both sales volume and pricing, supported by increased production levels.
Revenue Growth and Volume Recovery
In the latest quarter, Steppe Cement's volumes rose by 5%, and prices increased by 2%, signalling a recovery after the setbacks faced earlier in the year. The company attributed its improvement to enhanced factory capacity and productivity, which allowed it to mitigate the impact of past inflation and maintain a competitive edge despite strong market competition.
CEO's Optimistic Outlook
Javier del Ser Perez, the company's CEO, expressed optimism over the company's performance. He noted that the recovery in both volumes and pricing in Q3 followed a necessary price adjustment made during Q2. Perez highlighted that the factory's continuous improvements in capacity and productivity enabled the company to navigate challenges posed by inflation and competition.
Positive Market Reaction
Following the positive trading update, Steppe Cement's shares surged 19%, rising by 2.5p to 15.5p. The market responded favorably to the company's improved performance, reversing the decline triggered by the earlier profit warning.
