Saudi Arabia: Northern Cement profits fall 24%

Northern Region Cement Company reported a net profit of SAR48.66m (US$13m) in 2Q16, down 24 per cent from SAR64m (US$17m) compared to the same period last year.

However, profits were up 13.4 per cent compared to 1Q16. This QoQ rise is due to increased clinker sales and the YoY decrease is attributed to increased production costs as a result of higher energy prices and falling sales. Northern Cement’s profits for the first half of the year reach SAR91.6m, a 20.4 per cent decline from SAR114.6m in the first half of 2015.

Other Saudi Arabian cement companies also reported a decline in profits. Yanbu Cement announced a 35.3 per cent drop in profits to SAR159m (US$42.4m) in 2Q16, compared to SAR246m (US$65.6m) in 2Q15. Saudi Cement Company’s net profits fell 1.97 per cent YoY to SAR249m (US$66.4m) in 2Q16 from SAR254m (US$67.7m) in 2Q15. Hail Cement Company also posted a 3.51 per cent decrease in net profit in 2Q16, falling from SAR28.6m (US$7.6m) in 2Q15 to SAR27.6m (US$7.3m) in 2Q16.