Raysut Cement the largest cement company in Oman reported total net profit amounted to OMR19.03m (US$49.4m) during 9M-2010 compared to OMR24.18m in 9M-2009, which is less by 21.28 per cent. Raysut Cement’s revenues declined due to growing competition from external markets such as UAE and Saudi Arabia, which reduced sales volume and the company’s realisation in domestic and export markets. Also, the average cement selling prices decline and lower production levels, reduced the company’s revenues and profit margins.
On the other hand, Oman Cement posted 34.91 per cent gain in 9M-2010 amounting to OMR22.81m compared to OMR16.91m in 9M-2009. Despite cement prices across the region getting softened and the volume dropped, the company managed to sustain its quarterly sales volumes. Also, reduction in interest expenses and other higher income enhanced company’s EBIT. Despite, reduction in cost of sales due to imported cheaper clinker, lower revenues reduced company’s gross margin.
Going forward, Oman’s cement sector is expected to do well as the cement companies have capitalised on increasing the clinker capacities along with other cost control measures, Kuwait based investment house, Global, in its latest analysis of the earnings trends of listed companies in the Sultanate.