Monday, April 19, 2021

The General Assembly of “Arab Cement” approves the results of 2020 business

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The Ordinary General Assembly of Arabia Cement approved the Board of Directors’ report on the company’s activities for the past year 2020.

The general assembly approved the financial statements, and decided to vacate the board of directors for the past year.

The general assembly approved the dividend project, and did not include any distribution to shareholders during the past year.

“Arab Cement” company turned to a loss of 122.8 million pounds during the past year, compared to a net profit of 28.9 million pounds during the previous year 2019, taking into account the rights of the minority shareholders.

The company’s revenues declined during the past year 2020 to reach 2.48 billion pounds, compared to total sales of 3.1 billion pounds in the previous year.

The Arab Cement Company suggested an improvement in demand in the building materials and cement sector in particular during the next year, after getting rid of the consequences of the spread of the “Corona” epidemic locally and globally.

Karim Naguib, director of investor relations in the company, said that the sector crisis at the present time is that there is an excess of supply over what is required of customers and consumers, with the high cost of production for most companies.

Naguib said, in an interview with investors via the “video conference” feature, prepared by the Egyptian Stock Exchange, that the Arab Cement Company does not represent the cost of production for it, because it uses innovative and less expensive solutions such as the use of coal mills and alternative energy in general, due to the high gas prices.

He emphasized that the price of natural gas appropriate for factories ranges between 3 – 4 dollars per million thermal units, compared to coal.

Naguib expects that the company will incur a net loss by the end of this year, ranging between 50 and 60 million pounds, due to the repercussions of “Corona” and the decrease in demand during the period of construction stoppage due to precautionary measures for the outbreak of the “Corona” virus.

The company had achieved losses of 5.63 million pounds during the first half of the current year, compared to profits of 25.4 million pounds in the comparative period of 2019.

The company’s sales declined during the first half to 1.32 billion pounds, compared to sales of 1.6 billion pounds, in the comparative half of 2019.

He explained that the repercussions of “Corona” have greatly affected the demand in the Egyptian market, bringing the total demand during the current year in the sector as a whole to nearly 45 million tons.

Naguib added that the production capacity of the company reached 90% during the current year, after 96% during the year 2019, pointing out that the company does not have a production surplus, as it exports it despite the weak margin of profitability in export due to competition with surrounding countries, indicating an increase The market share during the current year to 9%, compared to the acquisition of 7-8% in recent years.

He emphasized that the increase in the market share is due to the company’s success in covering the demands of customers and consumers and increasing their confidence in the company.

He pointed out that the exportation accounts for 10% of the company’s total production, as it exports to African countries, Libya, Iraq, Yemen and some surrounding countries, pointing out that the expansion in exports is associated with competition, which puts pressure on the profit margins of the company.

In response to the Stock Exchange’s question about the impact of the reconstruction of Iraq on the cement market in Egypt after the signing of the last agreement between the two governments, Naguib indicated that the matter would revive the cement market in the event that cement was used from Egypt and participated in the reconstruction of Iraq, pointing out that Saudi Arabia It also has a large surplus of production and is located in the region.

 

The general article “Arab Cement” acknowledges the results of the 2020 business. It was written in the Al-Borsa newspaper.

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