Undertake a financial analysis and interpretation of the financial performance, financial position and cash flow position for the year 2017 and 2018 inshown below

BAMBURI CEMENT ANNUAL REPORT & FINANCIAL STATEMENTS 2018 Consolidated Statement of Profit or Loss and other Comprehensive Income For The Year Ended 31 December 2018 2018 2017 Notes Shs'million Shs'million Revenue Cost of goods sold 4 37,262 35,974 (26,466) (21,230) Cost of transport service (4,001) (4,831) Gross profit 6,795 9,913 Marketing and sales expenses 9(1) (1,002) (908) Administration expenses 9 (ii) 3,033) ,445) Impairment losses on financial assets 9 (52) (16) Impairment of other assets 9(iii) 49) (243) Other income 7(i) 47 40 Other losses 8 (255) (425 Other operating expenses 10(a) 1,463) (1,687) Restructuring costs 10(b) (153) Operating profit 835 4,229 Finance income 7(ii) 103 150 Finance costs 7 (iii) 258 263) Finance (cost) - net (155) 113 ) Profit before income tax 11(a) 680 4, 116 Tax charge 12(a) 66) (2, 143 Profit for the year 614 1,973 Other comprehensive (loss)/income not to be reclassified to profit or loss in subsequent periods: Actuarial gains 28 21 22 Income tax effect 12(a) (6) ( 7 ) 15 15 Revaluation of property plant and equipment 15(a 1,814 6,323 Income tax effect 12(a) (544) (1,897) 1,270 4,426 (Loss)/gain on valuation of quoted equities 19(b) (125) 39 Gain on sale of quoted equities 4 Income tax effect 12) (121) 27 Net other comprehensive income not to be reclassified to profit or loss in subsequent periods 1,164 4,468 Other comprehensive (loss)/income to be reclassified to profit or loss in subsequent periods: Exchange (losses)/gains on translation of foreign operations 388) 25 Net other comprehensive income to be reclassified to profit or loss in subsequent periods 388) 25 OTHER COMPREHENSIVE INCOME FOR THE YEAR, NET OF TAX 776 4,493 TOTAL COMPREHENSIVE INCOME FOR THE YEAR 1,390 6,466 Profit for the year attributed to: Owners of the parent Company 890 1,647 Non-controlling interest 18(b) (276 326 614 1,973 Total comprehensive income attributed to: Owners of the parent Company 1,401 6,052 Non-controlling interest 18(b) (11) 414 1,39 6,466 Earnings per share - basic and diluted 13 2.45 4.54 73FINANCIAL STATEMENTS > Company Statement of Profit or Loss and other Comprehensive Income For The Year Ended 31 December 2018 201 B 2017 Notes Shs'million Shs'million Revenue 4 22,310 21,446 Cost of goods sold 5 (15,744) (13,903) Cost of transport service 5 (1 ,910) (2,413) Gross profit 4,656 5.130 Marketing and sales expenses 9(i) (428) (528) Administration expenses 9(ii) (1,407) (1,371) impairment losses on financial assets 9 (35) - Impairment of other assets 9(iii) , (243) Other income 7(i) 47' 40 Other (losses) 8 (25) (317) Other operating expenses 10(a) (887) (935) Restructuring costs 10(b) (119) - Operating profit 1,802 1,776 Finance income 7(ii) 103 148 Finance costs in) (53) (58) Finance income - net. 50 90 Profit before tax "(in 1'352 1'866 Tax charge 12(a) (207) (1 .025) Profit for the year 1,645 841 Other comprehensive income not to be reclassied to prot or loss in subsequent periods: Revaluation of property plant and equipment 15(b) 5,904 Income tax effect 12(a) , (1,771) 4,133 (Loss)/gain on revaluation quoted equities 19(b) (125) 39 Gain on sale of quoted equities 4 - income tax effect 12(a) - (12) (121) 27 Actuarial gains 28 17 43 Income tax effect 12(a) (5) (4) 12 39 Net other cornprehensive(loss)/income not to be reclassified to prot or loss , . (109) 66 In subsequent periods OTHER COMPREHENSIVE (LOSS)/INCOME FOR THE YEAR, NET OF TAX (109) 4,199 TOTAL COMPREHENSIVE INCOME FOR THE YEAR 1 ,536 5,040 74 BAMBURI CEMENT ANNUAL REPORT & FINANCIAL STATEMENTS 2018 Consolidated Statement of Financial Position For The Year Ended 31 December 2018 2018 2017 Notes Shs'million Shs'mlllion ASSETS NON-CURRENT ASSETS Property, plant and equipment 15(a) 36,224 32,502 Prepaid operating lease rentals 16 124 136 Intangible assets 17 244 43 Other equity investments 19(a) 180 317 Other long term investments 18 (c) , 10 Biological assets 34(a) 399 471 Limestone reserves 17(b) 525 - Goodwill 20 217 217 37,913 33,696 CURRENT ASSETS Inventories 21 6,862 5,422 Biological assets 34(b) 72 - Trade and other receivables 22(a) 2,929 4,595 Corporate tax recoverable 12(0) 215 - Cash and cash equivalents 23(a) 2,366 3,490 12,444 13,507 TOTAL ASSETS 50,357 47,203 EQUITY AND LIABILITIES EQUITY Share capital 24 1,815 1,815 Asset revaluation reserve 25(a) 11,906 11,263 Fair value reserve 25(b) 102 Translation reserve 25(c) (2,042) (1,771) Retained earnings 16,032 17,963 Equity attributable to owners of the Company 29,711 29,372 Non-controlling interests 3,752 3,828 Total equity 33,463 33,200 NON~CURBENT LIABILITIES Deferred tax liability 26 4,693 4,456 Provisions 27 289 921 Employees' dened benefit liabilities 28 479 493 Long term borrowings 33(d) 2,010 - 7,471 5,870 CURRENT LIABILITIES Unclaimed dividends 14(a) 1 6 Bank overdrafts 23(c) 1 ,403 1,450 Provisions 27 69 52 Employees' dened benefit liabilities 28 42 80 Trade and other payables 29 7,824 6,096 Corporate tax payable 12(c) 84 449 9,423 8,133 TOTAL EQUITY AND LIABILITIES 50,357 47,203 12 April 2019 and were signed on its behalf by: See Dr John P.N Simba Seddiq Hassani Chairman Group Managing Director 75 FINANCIAL STATEMENTS Company Statement of Financial Position For The Year Ended 31 December 2018 2018 2017 Notes Shs'million Shs'million ASSETS NON-CURRENT ASSETS Property, plant and equipment 15(b) 19,731 19,487 Prepaid operating lease rentals 16 Intangible assets 17 148 11 Investments in subsidiaries 18(a) 2,000 1,062 Other equity investments 19(a) 180 317 Biological assets 34 (a ) 399 471 Loan to subsidiary 33 (c) 25 54 22,483 21,403 CURRENT ASSETS Inventories 21 3,475 2,828 Biological assets 34(b) 72 Loan to subsidiary 33(C) 29 29 Trade and other receivable 22(a ) 1,994 2,364 Cash and cash equivalents 23 (a) 2, 161 2,557 7,731 7,778 TOTAL ASSETS 30,214 29,181 EQUITY AND LIABILITIES EQUITY Share capital 24 1,815 1,815 Asset revaluation reserve 25 (a) 10,662 10,899 Fair value reserve 25 (b ) 102 Retained earnings 10,063 9,019 Total equity 22,540 21,835 NON-CURRENT LIABILITIES Deferred tax liability 26 2,620 2,451 Provisions 27 257 614 Employees' defined benefit liabilities 28 421 444 3,298 3,509 CURRENT LIABILITIES Unclaimed dividends 14(a) 6 Provisions 27 29 29 Employees' defined benefit liabilities 28 38 70 Trade and other payables 29 1,252 3,612 Corporate tax payable 12 (C ) 56 120 4,376 3,837 TOTAL EQUITY AND LIABILITIES 30,214 29,181 The financial statements on pages 73 to 167 were approved and authorised for issue by the Board of Directors on 12 April 2019 and were signed on its behalf by: Dr John P.N Simba Seddiq Hassani Chairman Group Managing Director 76