Tokyo Cement Group reported a turnover of Rs. 15,836 million and Profit After Tax (PAT) of Rs. 635 million for the first quarter ended June 30, 2026, compared with a turnover of Rs. 12,544 million and PAT of Rs. 668 million in the corresponding period last year.
The increase in turnover reflects gradual volume growth driven by the commencement of new construction projects. However, profitability remained under pressure due to elevated raw material, insurance, and freight costs arising from ongoing geopolitical tensions in the Middle East.
The cement industry announced a revision to the Maximum Retail Price (MRP) of cement in mid-April, reflecting sustained increases in raw material, freight, insurance, and fuel costs. The industry had absorbed these cost escalations since the onset of the Iran conflict before implementing the price adjustment.
In May, the Central Bank increased the Overnight Policy Rate (OPR) by 100 basis points from 7.75% to 8.75%, with the intention of managing inflation expectations and the impact of surging global petroleum costs. This led to a moderation of credit growth and import demand over the period.
Cement consumption declined in April, reflecting the seasonal slowdown associated with the Sinhala and Tamil New Year holidays. However, the gradual resumption of regional infrastructure projects, particularly in the roads and highways sector, supported a recovery in demand for cement and concrete during the latter part of the quarter.
Momentum is anticipated from externally funded development initiatives, including the Asian Development Bank-supported Post-Ditwah Cyclone Renovation and Livelihood Assistance Project, which encompasses the rehabilitation of transport and irrigation infrastructure, housing reconstruction, and livelihood restoration.
Government of India-funded affordable housing programmes benefiting over 1,550 families across the Northern, Southern and plantation regions, together with private sector investments under the Colombo Port City development, are expected to provide additional impetus to the sector.