Yamama Cement’s Q3 2019 results miss expectations: NCBC

Yamama Cement’s Q3 2019 net profit of SAR 55 million came lower than analysts’ and consensus estimates of SAR 60 million, NCB Capital said in a research note.

“The deviation is primarily on account of lower than expected sales, which was 6.7 percent lower than our estimates. Also, non-operating expenses were slightly higher than our expectation,” the note said.

The brokerage firm also said that the continued year-on-year (YoY) improvement in selling prices for Yamama Cement and potentially the remaining players is a key positive.

“However, the YoY decline in sales volume for Yamama Cement remains a key concern. We expect further clarity on the timeline of mega projects to be the key catalyst for an improvement in cement demand in Saudi going forward,” the note said.

Therefore, NCBC issued “Neutral” recommendation towards the company’s share with a target price of SAR 19.3 per share.