Riyadh Cement posts 'robust' Q1 results, sees stronger demand in 2024: CEO

Shoeil Al Ayed, CEO of Riyadh Cement

Riyadh Cement Co.’s Q1 2024 financials were robust given the high cost of production due to the rise in fuel prices and the decrease in sales volumes and housing projects for retail clients, which was directly impacted by increased interest rates, said CEO Shoeil Al Ayed.

He told Argaam that the uptick in selling prices partially offset the decline in sales, noting that the Saudi cement demand softened by 4% year-on-year (YoY) in Q1 2024.

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Selling prices were relatively stable during the first three months of the year, said the top executive, stressing that market stability contributes to boosting the sector’s performance, which is in the interest of the consumer.

Riyadh Cement's factories have distinguished locations, given their proximity to Riyadh, the largest and most consuming market in the Kingdom. This supports the company’s sustainability and solid performance.

Further, the cement producer actively contributes to key strategic projects such as Al-Diriyah project, King Salman Park and Qiddiya. It will also partake in some other projects poised to begin in H2 2024, including Expo 2030, World Cup 2034, Al Murabba, and King Salman Airport, as well as the metro expansion and sports stadiums projects, according to Al Ayed.

The company's stockpile of black clinker amounted to 1.1 million tons at the end of Q1 2024, said the top executive, pointing out that Riyadh Cement maintained stable performance and distributed dividends on a regular basis, which represented an edge for shareholders and investors.

Al Ayed stated that exports amounted to about 10% of white cement sales, indicating that the company exported in Q1 2024 to Jordan, Bahrain, Kuwait and Oman, with plans to expand exports to Iraq and African countries.

The CEO also expected the Saudi cement demand to soar 5% YoY by the end of this year, despite its 4% decline in Q1 2024. It is also seen to further rise in the coming years, thanks to the direct impact from mega projects undertaken in Riyadh.

According to Argaam's data, Riyadh Cement's Q1 2024 profit inched lower to SAR 70.1 million, down 4% from SAR 73.4 million.