Northern Cement’s Q2 results backed by overseas sales, investments: exec

Northern Region Cement Co. General Manager Obaid Al Sobiei

Northern Region Cement Co. posted stronger results in Q2 2021 on the back of overseas sales and investments, coupled with stability in white cement sales, company General Manager Obaid Al Sobiei told CNBC Arabia.

White cement represented about 30% of the company’s production in Saudi Arabia, with lower manufacturing rates in Jordan, as well as exports to Iraq. This shows that most of the production is consumed in the local market, he added.

The company exports around 100,000 tons to Jordan while exporting the final white cement product in smaller quantities to Iraq, Al Sobiei added.

He indicated that the cement manufacturer’s clinker inventory is stable, standing at nearly 700,000 tons in Saudi Arabia and about 700,000 tons in Jordan to steady sales.

He noted that the company started producing petroleum cement and exported some shipments to the Horn of Africa, while continuing negotiations to supply the product to the local market. The volume of shipments has reached 2,000 tons so far, with further shipments planned in the coming months.

Al Sobiei also said that the company’s loans fell from SAR 1.25 billion to SAR 800 million, noting it is working on a five-year plan that will target slashing debts without impacting dividend distribution.

The company posted a net profit after Zakat and tax of SAR 52.9 million for the first half of 2021, a rise of 27%, compared with SAR 41.7 million a year earlier. The cement producer’s Q2 2021 net profit rose 50% year-on-year (YoY) to SAR 21 million, according to Argaam’s data.