CCC’s Earnings Growth “Blocked” By Higher Expenses

  • Despite reporting robust topline growth in its financial year ending December 2025 (FY2025), Caribbean Cement Company Limited (CCC) recorded flat earnings of $5.92Bn (-0.6%) amid higher expenses.
  • Annual Revenue totalled $31.55Bn (+13.0%), underpinned by a 7% increase in domestic sales volumes, as well as an increase in exports. CCC benefited from operational efficiencies realised in its Kiln expansion, which expanded capacity and improved supply reliability. Notably, the supply reliability allowed the company to satisfy domestic demand in Hurricane Melissa’s aftermath whilst still facilitating higher exports.
  • Meanwhile, cost of sales increased by 16.7% to $19.05Bn, primarily reflecting expenses associated with the Company’s planned maintenance programme undertaken in the first half of the year (H1 2025). These activities temporarily constrained production efficiency and weighed on profitability, resulting in a gross margin of 33.0% during that period. However, following the completion of maintenance works in H2 2025, efficiency improved, bringing annual gross margins to 39.6%.
  • Added to that, operating expenses grew by 5.5% to $3.19Bn, mostly reflecting increases in administrative, distribution and logistics expenses. This, coupled with a 41.0% dip in other income to $258.63Mn and a 21.4% increase in other expense, meant operating profits grew by 3.7%.
  • Lastly, taxation charges increased by 21.2% to $2.20Bn. It reflects the cessation of tax incentives following the completion of the Company’s expansion programme. During the investment phase, the Government of Jamaica (GOJ) granted capital allowances, which made qualifying capital expenditures tax-deductible. With the expansion project finalised, these allowances tapered off, resulting in higher taxes.
  • Despite a projected short-term recession following Hurricane Melissa, Jamaica’s transition to large-scale reconstruction is expected to drive sustained cement demand.
  • Beyond the local market, CARICOM exports remain significantly underpenetrated, contributing less than 1% of total revenue in 2025. Management’s stated intention to expand into select regional markets presents a medium-term growth lever, particularly once domestic rebuilding demand begins to normalise.
  • That said, there are downside risks to CCC’s outlook, including substitution with lower-cost building materials, and exposure to foreign exchange volatility.
  • CCC's stock price has increased by 5.1% since the start of the year to close at $106.94 on Monday, March 2, 2026. At this price, it trades at a P/E of 15.4x, which is above the Main Market Energy, Industrials and Materials Sector average of 12.6x.

(Sources: JSE & NCBCM Research)