The Kenyan government is exploring options to revive East African Portland Cement (EAPCC), which reported a Sh1.26 billion loss for the six months ending December 2018. Cabinet Secretary Peter Munya confirmed discussions with potential investors to inject at least Sh15 billion into the struggling cement producer, which has accumulated a Sh10.8 billion debt. The firm’s financial challenges include a negative cash position and a balance sheet deteriorating from an insolvent Sh6 billion in June 2018 to Sh7.3 billion in excess of current assets.
Munya highlighted ongoing efforts to restructure EAPCC, including management changes and modernization of its Athi River plant. The company’s chairman, Edwin Kinyua, acknowledged operational constraints, stating the firm currently operates at 50% capacity. Despite a 53% reduction in finance costs—from Sh313 million in 2017 to Sh204 million by December 2018—EAPCC faces pressure from creditors, including KCB Group, which holds a Sh4.5 billion debt.
Kinyua noted that creditors have agreed to a grace period to avoid asset auctions, while the company pursues cost-cutting measures like staff layoffs and outsourcing. EAPCC’s financial reports reveal a Sh1.3 billion increase in insolvency over six months, with revenues dropping from Sh3 billion in the same period of 2017 to insufficient levels for meeting demand.
