Najran Cement Co. is expected to report strong financials in Q2 2020, Al Arabiya TV reported, citing Chief Executive Officer, Abdulsalam Al-Duraibi.
The company's total sales increased by 11% and 13% in April and May respectively, despite the overall slowdown in the whole industry, Al-Duraibi stated.
"We have reported profit growth in Q1 2020, as the COVID-19 outbreak has a minimal impact on the company's operations since it started in mid-March," he added.
"The coronavirus pandemic will have a minimal impact on the cement industry," the CEO noted, expecting the industry to post higher results by year-end, though projects might face some delay for a short period.
If the industry is negatively impacted this year, it will buck the downtrend by the coming year, given that the cement sector is a key pillar of Saudi Vision 2030, he noted.
Al-Duraibi indicated that the prepayment of Banque Saudi Fransi's (BSF) loan helped the company to save around SAR 1-2 million.
"Najran has a debt-to-asset ratio of nearly 14%, and a net debt ratio of 10% - the lowest in the industry and lower than the local market average," he added.
“The company's financial position is better than before. As cement firms have a one-time investment, but their assets are being amortized over the years," Al-Duraibi said, adding that the dividend payment decision is taken by the board of directors.
Najran Cement earlier requested BSF for a full pre-settlement of the remaining amount of its existing loan facility, which was provided to finance the Waste Heat Recovery (WHR) project with a total repayment of SAR 45 million, Argaam reported.
The cement producer posted a net profit of SAR 40 million in Q1 2020, compared to SAR 6.1 million in year-earlier period.
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