Riyadh Cables confirms 139,000-ton order book valued at SAR 5.2B

Logo of Riyadh Cables Co.

Borjan Sehovac, CEO of Riyadh Cables Co., said the company’s confirmed order book stands at 139,000 tons worth SAR 5.2 billion - its highest level to date - which will support revenues over the next 12 to 18 months.

In an analyst and investor call attended by Argaam, Sehovac said the production mix saw an increase in the share of aluminum, while the proportions of copper and aluminum remained stable compared to the same quarter in 2024. 

He noted that demand for high and extra-high voltage cables is driven by electricity interconnection projects and the transition to renewable energy, especially as 70% of solar power projects in Saudi Arabia rely on these types of cables.

The trend remains strong in both Saudi Arabia and the region, the CEO said.

Commenting on Q1 2025 financial results, Sehovac said the 52% annual profit increase was supported by a rise in sales volume and improved operational efficiency.

Revenue grew by 23% year-on-year (YoY), driven by a 95% utilization rate and a 36% YoY increase in gross profit per ton.

Meanwhile, CFO Bahaa Ahmed Bakr Issa said the company distributed SAR 524 million in dividends for 2024 at SAR 3.5 per share, representing 64% of net profits.

He affirmed Riyadh Cables’ ability to finance operations and cash dividends through operating cash flows, which reached SAR 55 million in Q1 2025, despite an increase in receivables and capital expenditures.

Regarding operating profits, Ahmed said a SAR 59 million provision for expected credit losses impacted the first-quarter results, though it does not indicate any actual weakness in performance, as these provisions are reviewed periodically.

Further, the CFO said the cable producer expects prices to remain stable in the coming quarters, with single-digit growth in gross profit per ton, stressing that the company’s hedging policy ensures profitability remains protected from fluctuations in base metal prices.

The pricing and hedging strategy adopted by the company helped safeguard profitability from volatility in base metal prices, Ahmed said, noting that copper prices fluctuated between $8,000 and $10,800 per ton in 2024, yet the company’s profitability remained unaffected.

The firm raised its capital spending to about SAR 300 million to improve operational efficiency and replace old equipment, in line with growth plans and increased production volumes.

Current estimates indicate that the company’s production capacity is approaching 270,000 tons annually, based on the current product mix.

Approximately 60% of current orders are related to high and extra-high voltage transmission cables and overhead transmission lines, he said.

Distribution and renewable energy projects account for 20% each, the CFO concluded.