Overseas investments boost Northern Cement Q3 earnings: CEO

Obaid Al-Subaie, CEO of Northern Cement

Northern Region Cement Co. (Northern Cement) reported good profit from overseas investments in Jordan and Iraq, accounting for nearly 75% of earnings, as the local market conditions had a limited impact on the company, according to CEO and board member Obaid bin Saad Al-Subaie.

Al-Subaie explained to Argaam that the company’s strategy focuses on risk distribution via the diversification of products or foreign investments.

“We have entered the Iraqi market since 2010, and we gradually invested in factories until we reached the expansion phase, as we have recently signed a contract to set up a new production line,” Al-Subaie said.

The Saudi cement producer expanded its product portfolio to include the production of white cement, which fared well, and it still has potential products to launch, he added.

Northern Cement reported earnings decline year-on-year (YoY) but profit growth quarter-on-quarter (QoQ) in Q3 2023 due to the impact of both local and international markets on cement production.

Northern Cement has a debt portfolio of nearly SAR 900 million, with a cost of debt of SAR 38 million, Al-Subaie said, adding that the company seeks to pay off these debts through operations and internal earnings.

Northern Cement’s nine-month earnings dropped 13% YoY to SAR 64.8 million from SAR 75.4 million in the same period last year. In Q3 2023, net profit reached SAR 23.9 million, according to Argaam’s data.