Steppe Cement narrows loss despite energy cost, inflation pressures
By Josh White
Date: Monday 15 Sep 2025
(Sharecast News) - Steppe Cement narrowed its losses in the first half of 2025 as higher sales volumes and stronger margins offset rising energy costs and inflationary pressures in Kazakhstan.
The AIM-traded producer reported revenue of $40.9m for the six months ended 30 June on Monday, up 19% from $34.4m a year earlier, driven by an 18% increase in sales volumes to 850,424 tonnes.
Gross margin improved to 21% from 15% as higher output and firmer local pricing in Kazakhstani tenge outweighed steep electricity costs.
The group posted a net loss of $0.5m, significantly reduced from a $3.5m loss in the prior year, with losses per share narrowing to 0.2 cents from 1.6 cents.
Average cement prices held steady year-on-year at $48 per tonne, while selling expenses fell 13% as the company prioritised markets closer to its factory.
Administrative expenses rose 6% and electricity costs continued to climb above the rate of inflation, which accelerated to 11.8% in Kazakhstan from 8.4% last year, prompting the central bank to lift its base rate to 16.5% in March.
Steppe said production costs remained flat in tenge terms despite higher electricity, diesel and consumable prices, with clinker output up 4% in the half and on track for 8% growth in 2025.
The company invested in ecological compliance measures, including new filters, and commissioned a dynamic separator for its third raw mill.
It said it was exploring ways to boost clinker capacity at its Line 6 and optimise its wider asset base.
Kazakhstan's cement market grew 19% in the first half, supported by favourable weather, economic growth, infrastructure spending, population increases and subsidised mortgage lending, though Steppe expects the pace to slow in the second half.
The company said it aims to maintain its domestic market share at around 14% for the full year, with total volumes between 1.8m and 1.85m tonnes.
Exports fell to 0.4m tonnes from 0.45m a year earlier, while imports rose to 7.7% of the market amid increased supply from Uzbekistan.
At 30 June, Steppe reported borrowings of $4.8m, cash of $7.3m and clinker and cement inventories also valued at $7.3m.
Finance costs totalled $0.6m, including $0.5m in interest on subsidised bank loans.
At 0803 BST, shares in Steppe Cement were down 4.57% at 16.7p.
Reporting by Josh White for Sharecast.com.
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