reports
- Talha Nazr
Saudi Cement Sector: Q4 Update | Mega/Giga projects to support demand
We maintain our long-term positive outlook on the Saudi Cement sector. The acceleration of the Mega/Giga project will support long-term demand, whereas housing demand seems to have normalized as indicated by the slowdown in mortgage growth and low prices remain the main concern. In our view, the sector is going through a consolidation phase, as indicated by the ongoing M&A deals. We believe this may result in lower competition and better pricing mechanisms for the sector. We expect selling vo...
- Talha Nazr
Southern Province Cement Company: Q3 22 | Strong volume growth offsets...
Southern Cement reported a broadly in line set of Q3 22 results with the net income increasing by 20.3% yoy (+47.1% qoq) to SAR89.0mn. This compares to the SNB Capital and consensus estimates of SAR84.0mn and SAR74.5mn, respectively. Revenues increased by 13.6% yoy (+38.1% qoq) to SAR323mn, but came lower than our estimates of SAR364mn, mainly due to lower selling prices. We believe the variance in earnings is driven by lower than expected production costs as cost per ton stood at SAR115/ton ...
- Talha Nazr
Southern Province Cement Company: Selling prices more resilient than i...
Southern Cement reported a broadly in-line set of Q2 22 results, with the net income declining by 29.9% yoy (-31.5% qoq) to SAR61.0mn. This compares to the SNB Capital and consensus estimates of SAR66.2mn and SAR59.0mn, respectively. Revenues came-in at SAR234mn (-18.6% yoy, -29.1% qoq) vs our estimates of SAR244mn, mainly due to lower selling prices. We note, this is the lowest quarterly revenue since Q3 18. We believe the variance in earnings is driven by higher than expected production cos...
- Iyad KhalidÊGhulam
Southern Province Cement Company: Margin contraction despite price res...
Southern Cement reported a net income of SAR96.6mn in Q4 21, decreasing 31.5% yoy (+15.8% qoq). This is lower than SNB Capital and consensus estimates of SAR118mn and SAR110mn, respectively. We believe the variance in earnings was mainly driven by 1) higher than expected production costs, which stood at SAR124/ton, compared to our estimates of SAR117/ton and 2) slightly higher than expected volumes, which stood at 1.70mn tons, compared to our estimates of 1.64mn tons. * Total selling quantit...
- Iyad KhalidÊGhulam
Southern Province Cement Company: Higher-than-expected prices, a key h...
Southern Cement reported a net profit of SAR83mn in Q3 21 (-44.6% yoy, -12.8% qoq), in-line with our estimates of SAR80.6mn, but lower than the consensus estimates of SAR90.6mn. Revenues declined 33.3% yoy to SAR284mn (-1.2% qoq), broadly in-line with our estimates. Although selling quantities stood at 1.44mn tons (-33.9% yoy, +0.6% qoq), in-line with our estimates, average selling prices stood at SAR198/ton, higher than our estimates of SAR185/ton. * Total selling quantities (comprising onl...
SOUTHERN PROVINCE CEMENT sees an upgrade to Slightly Positive due to a...
The general evaluation of SOUTHERN PROVINCE CEMENT (SA), a company active in the Building Materials & Fixtures industry, has been upgraded by the independent financial analyst theScreener with the addition of a star. Its fundamental valuation now shows 2 out of 4 possible stars while its market behaviour can be considered as moderately risky. theScreener believes that the additional star(s) merits the upgrade of its general evaluation to Slightly Positive. As of the analysis date September 10, 2...
- Iyad KhalidÊGhulam
Southern Province Cement Company: Weak earnings on lower volumes
Southern Cement reported a weaker than expected set of Q2 21 earnings, with a net income of SAR95mn (-29.6% yoy, -45.7% qoq). This is lower than the SNB Capital and consensus estimates of SAR116mn and SAR108mn, respectively. We believe the variance was mainly due to lower than expected sales of SAR287mn (-15.4% yoy, -34.7% qoq) vs our estimates of SAR319mn, as a result of lower than expected selling quantities which declined -17.2% yoy. * Total selling quantities (comprising only of local ce...
- Iyad KhalidÊGhulam
Saudi Cement Sector Q1 21 Update – Strong demand to support outlook
We maintain our positive outlook for the Saudi Cement sector. The ongoing housing programs, pick-up in the Giga projects and PIF’s 2021-2025 strategy are expected to be the key growth drivers. We estimate local cement sales to grow by +3.5% yoy in 2021f to 52.8mn tons, following strong growth of +20.7% yoy in 2020 to 51.1mn tons. This is expected to result in an attractive 2021f dividend yield of 5.1%, which is the sector’s major attractiveness. However, cement price volatility is a key conce...
- Iyad KhalidÊGhulam
Southern Province Cement Company: Q2 20 review – Strong results on t...
Southern Cement reported a net income of SAR135mn in Q2 20, increasing +48.4% yoy (-26.2% qoq). This is higher than the NCBC and consensus estimates of SAR113mn and SAR100mn, respectively. The strong sales growth of +22.8% yoy was in-line with our estimates, the positive surprise came from higher than expected gross margin expansion. Gross margins expanded by 390bps yoy to 44.8%, due to marginally higher than expected selling prices and marginally lower than expected cost/ton. Southern Cement...
- Fatma CHARFI
The slump persists
Cement makers’ results fuel our worries about the Saudi sector. SPCC’s revenues stand at SAR216m, down by -43.2% in Q3 2017 compared to the same quarter one year earlier. The Net profit fell sharply by 67% to SAR57m in Q3 2017 vs. SAR174m in Q3 2016. The company’s EPS stands at SAR 0.68 vs. SAR1.91, a decrease of 64.4%. SPCC’s EBITDA margin shrank by 540 bps, decreasing from 60.9% to 55.5% on 30/09/2017.
- Fatma CHARFI
THE CEMENT MAKER’S CRASH
SPCC’s figures continue their bearish trend following the disastrous state of the Saudi sector. Revenues announced in Q2 2017 are 50.7% lower than Q2 2016 sales, attaining SAR243m vs. SAR493m. The Saudi cement maker’s net profit went down by more than 64.5% compared to the same quarter one year earlier (SAR95m in Q2 2017 vs. SAR268m in Q2 2016). While the EPS fell from SAR3.94 in H1 2016 to SAR1.43 in H1 2017.
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Lower than expected!
SPCC announced lower Q1 2017 figures compared to the previous year. These results reflected the disastrous state of the Saudi cement sector. Revenues fell by 44.8% to SAR303m vs. SAR549m in the same quarter last year, harmed by a volume decline by 32.9% (from 2,280 mt to 1,528 mt). However, the income from equity associates increased by 3.23% to attain SAR3,360m. SPCC’s net profit was down by 62.9%, comparing to Q12016, to only SAR105m.
Ford Equity International Rating and Forecast Report
Ford Equity International Research Reports cover 60 countries with over 30,000 stocks traded on international exchanges. A proprietary quantitative system compares each company to its peers on proven measures of business value, growth characteristics, and investor behavior. Ford's three recommendation ratings buy, hold and sell, represent each stock’s return potential relative to its own country market.. The rating reports which are generated each week, include the fundamental details behind...
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