SIECO eyes new business, markets post capital increase: CEO

The Saudi Industrial Export Co. (SIECO) is planning to use its planned capital increase to earn new export contracts and access fresh markets, Chief Executive Officer Hazem Al-Dossari told Argaam.

The company specializes in the marketing of Saudi Arabia's (national) industrial products locally and abroad.

Last week, it filed a capital increase request, thereby issuing SAR 54 million rights issue. The move follows a 90 percent capital cut in last December that it used to reduce accumulated losses to below ten percent.

"The planned capital raise is likely to enhance our international trade activities and help us access new regional and international markets with Saudi products. That serves Saudi Vision 2030”, he added.

SIECO announced recently the opening of a new branch in Jordan to export Saudi products to Jordan, Egypt, Iraq and North Africa. It plans to open another branch in UAE to manage exports to East Asia countries, including India, Bangladesh, Indonesia, and China.

It also eyes new opening in Djibouti by 2019, in line with its strategy aimed at diversifying revenue and boosting presence in North Africa.

“We are optimistic about the growth potential in our target markets, which will reflect positively on our performance in the near term,” said the chief executive.

The company’s operating revenue increased five-fold YoY in Q1 2018, despite market challenges, Al-Dossari said, adding that his company will focus on industrial, construction and food contracts going forward.

SIECO generated net earnings of SAR 12.6 million in Q1 2018, versus a net loss of SAR 1.8 million, a year earlier.

In January, the company signed a one-year contract with Saudi Aramco Base Oil Co. (Luberef) to buy its entire output of sulfur for one year. It also signed a deal with Al Jouf Cement Co. to export 72,000 tons of cement to Jordan, and a deal with Al-Safwa Cement Co. to export Portland cement and clinker.

“Depending on sulfur exports alone is risky. Rather we think we can generate higher yields from new export contracts,” Al-Dossari said.