Saudi Arabian producer, Yanbu Cement posted a 23% rise in net profit for the fourth quarter compared to the same period last year and 7.4% up against the third quarter, though full-year results saw the company slide against 2009.
Yanbu saw after-tax gains rise to SAR 101 million compared to SAR 82 million last year and SAR 94 million in the previous quarter. Gross profit rose to SAR 111 million and operating profit hit SAR 104 million, up 32.1% and 35.1% respectively against 2009.
Yanbu Cement Company is one of nine listed cement companies in the Kingdom and one of the biggest distributors of the commodity by market capitalisation, though like many rivals has seen profits erode from an increasingly saturated market. Net profits fell 17% for the first nine months of 2010 against the same period last year, following a 22% fall in net gains for the first half.
Analysts say the criteria for exporting cement – which includes selling one bag domestically for SAR 10 for every bag sold abroad – has removed any incentive for companies to look beyond the country’s borders. Nishit Lakhotia, senior analyst at Securities & Investment Company in Bahrain, has even highlighted the possibility of a consolidation in the Saudi cement industry if a domestic price war takes off in 2011.