Raysut Cement Co net profit down 62%

Raysut Cement Co reported a 61.76 per cent decline in its net profit in 1Q17 impacted by lower sales volume and increased tax rate, according to its quarterly report submitted to the Muscat Securities Market on Tuesday.

Group net profit fell to OMR3.09m versus OMR8.08m in the same period a year earlier. The decline was attributed to a significant increase in the cost of electricity, lower sales volumes and an increased tax rate from 12 to 15 per cent, the Muscat Daily reported.

During the period under review, sales volumes were down by nearly 25 per cent to 764,203t from 1.02Mt sold in the same period of last year.

While sales at the parent company fell 18.96 per cent, Raysut Cement’s UAE subsidiary Pioneer Cement recorded a 35.4 per cent decline in sales volumes.

Raysut Cement’s group revenue fell 23.17 per cent to OMR19.43m in the first quarter against OMR25.29m in the same period of last year. Revenue earned by Pioneer Cement dropped by 34.31 per cent to OMR5.13m as compared to OMR7.81m achieved last year.

"Various cost reductions initiatives coupled with optimisation of distribution of cement, keeping market share and profitability in mind, would be the major area of attention in the coming years. With those internal initiatives the company is hopeful to minimise the pressure to a great extent," Raysut Cement said.