Gulf cement firms’ profits fall 12.4% to Dh3bn

Cement companies in the Gulf Cooperation Council (GCC) profit fell 12.4 per to $822 million (Dh3 billion) in the first half of this year from $939 million for the corresponding last year as delays in real estate and construction projects hit their bottomline.

The companies also saw 13.8 per cent decline in revenues to $2.14 billion during the first half of this year from $2.48 billion for the same period last year, said a study by Global Investment House.

Gross profits of the regional companies also plunged 18 per cent to $124.7 million during the first half.

Cement firms in the UAE, which has the largest construction market in the region, have seen a drop in sales revenues of 33.5 per cent this year, Global said..

Kuwait, Qatar and Oman also recorded sharp drops in sales revenues by 31.6 per cent, 24.5 per cent and 27.2 per cent respectively.

Saudi Arabia bucked the trend and was the only country in the region that saw an increase in sales of 5.5 per cent due to strong demand by new companies.

Cement prices in the region averaged around $65.6 per tonne during the first half of 2010 against $78.5 for the same period last year, a drop of 16.4 per cent.

The regional cement companies also reduced debt and improved asset quality. Debt and liabilities decreased eight per cent and 2.8 per cent respectively during the first half of this year.

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