UCL to expand across Uganda in fresh marketing strategy

Uganda Clays Limited workers pack building blocks for delivery. The company will open agencies in major towns around the country in a new marketing strategy. FILE PHOTO

What you need to know:

Company has not given dividends to shareholders for four years due to bad performance.

Kampala- Uganda Clays Limited (UCL) will boost its marketing strategy by opening up agencies in all major towns in the country, managing director George Inholo has said.
The move is meant to turn around the company’s fortunes.
UCL has been facing financial constraints and has not given shareholders dividends for four consecutive years due to the not-so-impressive performance.

“We are changing our marketing strategy which has been a challenge. We want to revamp our route to marketing by setting up agencies in all satellite towns across the country,” Mr Inholo said in an interview with Daily Monitor last week.

According to the new managing director, the company is expected to open up new agencies in Arua, Soroti, Busia, and Fort Portal and in the Albertine Region.

“We have already opened up one in Hoima, considering the mushrooming infrastructure investments induced by the oil exploration and drilling activities,” said Mr Inholo.

Advanced technologies
Besides change of strategy, the new company management is also raising funds of up to Shs12 billion to change the line of production by acquiring advanced technologies.
Currently, drying of products is done naturally by the sun while firing especially at the Kamonkoli factory is costly due to the furnace fuel which increases production costs.

“At our Kamonkoli plant in Mbale, we are converting technology from using Heavy Fuel Oils (HFO) which has a dollar effect to using coffee husks, saw dust and ground nut shells,” Mr Inholo said.

UCL posted a revenue decline for the six months ended June 30, 2014, according to the published financial statement, with its revenue falling 26 per cent to Shs9.8 billion from Shs10.4 billion posted over the same period last year. Gross profit slumped to Shs1.3 billion from Shs3.7 billion while its current assets declined to Shs10.7 billion compared to Shs13.9 billion posted in the previous year.

The company said in a statement that fall in the gross profit margin is due to consistently high firing costs and the production losses created by the worn factory machinery and spares.

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