By Andy Sambidge
Company says performance boosted by production increase and rise in local cement sales
Saudi Cement Company on Monday announced net profit for the first quarter of 2013 of SR340.3m ($90.6m), up 4.5 percent on the SR325.6m posted in the same period last year.
The increase was also a 22.5 percent rise on the SR277.7m recorded in the previous quarter, the company said in a filing to the Saudi bourse.
The company said the rise in profits during the current quarter compared with the corresponding quarter of last year was attributed to an increase in operating efficiency as production rose.
The rise in the current quarter compared with the previous quarter was attributed to increased local cement sales as a result of rise in local demand, it added in the statement.
The company is likely to benefit from a housing construction boom in Saudi Arabia, the biggest Arab economy, as the country faces up to a massive housing problem due to rapid population growth and an inflow of expatriate workers enticed by jobs in oil and construction.
The population is estimated to have doubled in size since 1988 and is thought to be growing at more than 2 percent annually.
Despite land covering more than 2 million square metres, the majority of the kingdom’s residents live in major cities such as Riyadh, Jeddah and Dammam, but the cities lack the housing density required of such populations.
About 5.2 million, or about 20 percent of the total population, live in the capital, Riyadh, while Jeddah has a similar population in a smaller area, making it the country’s most densely populated city.
The kingdom has said it plans to spend as much as US$67bn on new homes for Saudi nationals across the kingdom.