By: Thabet Shehata
Riyadh – Mubasher: Saudi cement companies’ profits retreated in the first quarter of 2016, compared to the corresponding period last year after being pressured by energy prices and a rise in the cost of imported clinker.
Net profits for the 14 listed cement firms on the Saudi Stock Exchange (Tadawul) were down 6.54% to SAR 1.6 billion ($427 million) in Q1-16 from SAR 1.7 billion ($435 million) in the same period the year before, according to statistics by Mubasher.
A total of 9 cement firms reported declines in their net profits due to rising energy and imported clinker costs, added to retreating sales and weak local demand.
Mubasher statistics also showed that operational profits from the listed cement companies fell 7.65% to SAR 1.63 billion ($435 million) in the first three months of the year, compared to SAR 1.76 billion ($470 million) in Q1-15.
Southern Province Cement reported the highest profits amongst its sector peers, with net profits growing 6.4% year-on-year to SAR 283 million in Q1-16 from SAR 266 million in the same period last year.
The firm attributed its profit rise to lower cost of sales, and to not using imported clinker, in addition to a decline in general and administrative costs and a rise in other revenues.
Saudi Cement ranked second in terms of highest profits, with SAR 265 million in Q1-16 compared to SAR 303 million in the corresponding period a year ago, registering a decline of 12.54%.
The company ascribed its profit fall to lower sales and increased energy prices.
On the other hand, Tabuk Cement Co. posted the least profits in the sector, with net profits reaching SAR 22.2 million in Q1-16, a drop of 32% from SAR 32.6 million in Q1-15.
Umm Al Qura Cement was the only company in the sector to see losses in the first three months of the year, as net losses stood at SAR 3.65 million, a decline of 22.54% from losses of SAR 4.7 million in Q1-15.
Translated by: Nada Adel Sobhi
