Cement Dispatches for October 2016 - Aljazira Capital
Cement Dispatches for October 2016 November 2016 Saudi Cement Sector | Monthly Report | October 2016
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Cement Dispatches: Growth of 29.2%MoM, a decline of 14.4%YoY; Clinker Dispatches Growth inventories recorded a historical high: According to the data released by Yamamah Dispatches (1000 Ton)(LHS) compared to 5.1mn tons in October-2015, depicting a decline of 14.4%YoY, and growth of 29.2%MoM.
60.0%
Change %(RHS)
6,000
40.0%
5,000
20.0%
Thousand Tonne
cement Co, cement dispatches for the month of October-2016 stood at 4.4mn tons,
4,000
Overview: The recorded MoM growth is attributed to the impact of Hajj season that
0.0%
3,000
discontinued projects. We expect to witness growth in dispatches for the next two
Oct-16
Sep-16
Jul-16
Aug-16
Jun-16
Apr-16
May-16
Mar-16
-40.0%
Jan-16
1,000
6.3%YoY, mostly due to weak demand and lower awarded contracts, in addition to
Feb-16
declined from 50.2mn tons in 2015 to 47.1mn tons in 2016 depicting a decline of
Dec-15
-20.0%
Oct-15
2,000
Nov-15
resulted in slowdown in construction during 3Q-2016. For 10M-2016, Cement sales
Source : Yamama Cement Company, AlJazira Research
months on the same pace after the seasonality impact in 3Q-2016.
Share in Dispatches by Regions
On MoM basis, all cement companies showed growth in dispatches, except AlJouf
Regions
Share in Dispatches Share in Inventory Oct-15 Oct-16 10M-2016 Oct-15 Oct-16
cement which recorded a decline of 5.6%. AlSafwa cement showed the highest growth
“Central Region”
27.19% 30.21% 29.08% 29.38% 28.84%
by 75.0%MoM followed by Yanbu cement with a growth of 61.4%MoM. On YoY basis,
“Western Region” 22.63% 23.04% 21.91% 18.89% 17.14%
Tabuk and Qassim cement were the only companies to show growth in cement dispatches, recording an increase of 6.9%YoY and 2.9%YoY respectively. Northern
“Southern Region” 20.80% 18.32% 19.17% 16.36% 15.30% “Eastern Region”
17.46% 18.03% 17.90% 22.21% 23.37%
“Northern Region” 11.93% 10.40% 11.94% 13.16% 15.35%
cement and Najran cement witnessed a fall of 48.6%YoY and 45.0%YoY respectively.
Key Performance: Data/Ratios Despite the decrease in Clinker production, Clinker inventories recorded new Market Cap(bn) highs: Clinker inventory continued to increase reaching a new historical high of P/E (TTM)
49.0 9.29x
27.1mn ton depicting an increase of 17.1%YoY due to weak demand and higher P/B
1.43x
Dividend Yield: production to sales ratio. Northern cement showed an increase of 12.5%MoM in YTD (%) clinker inventory , followed by City cement which showed increase of 10.4%MoM. ROA On the other hand, Aljouf and Saudi cement companies’ clinker inventory witnessed ROE
9.97% -19.72% 12.06% 15.83%
Source : Yamama Cement Company, AlJazira Research
Oct-16
Aug-16
Sep-16
Clinker Inventories(1000 Ton)(LHS)
Jul-16
Jun-16
0
May-16
5,000
Apr-16
2015 to 4.5% in October 2016.
10,000
Mar-16
4.2% in October-2015, followed by Najran cement as it declined from 7.0% in October
15,000
Feb-16
cement company market share declined to 2.5% in October-2016 as compared to
20,000
Jan-16
cement increased its market share from 6.7% to 8.1%. On the other hand, Northern
14% 12% 10% 8% 6% 4% 2% 0% -2%
25,000
Dec-15
it increased from 2.0% in October-2015 to 2.5% in October-2016. Moreover, Qassim
Invenories Level 30,000
Oct-15
Market Share: Tabuk cement showed an improvement in its market share YOY as
Nov-15
a decrease of 5.1%MoM and 2.1%MoM respectively.
-4%
Change %(RHS)
Key Data Dispatches Region “Central Region”
“Western Region” “Eastern Region” “Southern Region” “Northern Region”
Companies
Sep-16
Oct-15
Oct-16
Yamamah Cement City Cement Qassim Cement Riyadh Cement Total Yanbu Cement Arabian Cement AlSafwa Cement Total Saudi Cement Eastern Cement Total Najran Cement Southern Cement Total Northern Cement AlJouf Cement Tabuk Cement Hail Cement Total Total
355 175 273 247 1,050 347 220 88 655 461 142 603 167 505 672 94 144 86 95 419 3,399
514 236 345 300 1,395 588 415 158 1,161 632 264 896 358 709 1,067 214 144 102 152 612 5,131
442 235 355 295 1,327 560 298 154 1,012 585 207 792 197 608 805 110 136 109 102 457 4,393
%Change M/M 24.5% 34.3% 30.0% 19.4% 26.4% 61.4% 35.5% 75.0% 54.5% 26.9% 45.8% 31.3% 18.0% 20.4% 19.8% 17.0% -5.6% 26.7% 7.4% 9.1% 29.2%
% change Y/Y -14.0% -0.4% 2.9% -1.7% -4.9% -4.8% -28.2% -2.5% -12.8% -7.4% -21.6% -11.6% -45.0% -14.2% -24.6% -48.6% -5.6% 6.9% -32.9% -25.3% -14.4%
Clinker Inventory Levels 10M-15 4,788 2,122 3,563 2,738 13211 5,728 4,381 1,542 11650 6,383 2,546 8929 3,683 6,968 10651 1,912 1,381 1,075 1,432 5,800 50,240
% 10M-2016 Change 4,595 2,590 3,436 3,067 13,688 5,003 3,790 1,521 10,314 6,254 2,170 8,424 2,510 6,512 9,022 1,652 1,600 1,146 1,224 5,622 47,070
-4.0% 22.1% -3.6% 12.0% 3.6% -12.6% -13.5% -1.4% -11.5% -2.0% -14.8% -5.7% -31.8% -6.5% -15.3% -13.6% 15.8% 6.6% -14.5% -3.1% -6.3%
Sep-16
Oct-15
Oct-16
3,981 1,091 919 1,610 7,601 3,664 664 312 4,640 4,508 1,868 6,376 2,751 1,244 3,995 662 1,201 928 1,230 4,021 26,633
3,363 754 961 1,715 6793 3,390 873 106 4369 3,712 1,423 5135 2,547 1,237 3784 769 628 801 846 3,044 23,125
4,054 1,204 925 1,624 7,807 3,646 653 342 4,641 4,414 1,914 6,328 2,840 1,301 4,141 745 1,140 960 1,311 4,156 27,073
YoY % Change 20.5% 59.7% -3.7% -5.3% 14.9% 7.6% -25.2% 222.6% 6.2% 18.9% 34.5% 23.2% 11.5% 5.2% 9.4% -3.1% 81.5% 19.9% 55.0% 36.5% 17.1%
MoM % Change 1.8% 10.4% 0.7% 0.9% 2.7% -0.5% -1.7% 9.6% 0.0% -2.1% 2.5% -0.8% 3.2% 4.6% 3.7% 12.5% -5.1% 3.4% 6.6% 3.4% 1.7%
Source: Yamamah Cement Company, AlJazira Capital
1
Analyst
Analyst
Jassim Al-Jubran
Waleed Al-jubayr
+966 11 2256248 [email protected]
+966 11 2256146 [email protected]
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Cement Dispatches for October 2016 November 2016 Saudi Cement Sector | Monthly Report | October 2016
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Company News & Events Date of Company Name Announcement
Corporate Event & Announcement
Tabuk Cement
29-09-2016
Tabuk Cement Co. will begin commercial operations at its second production line in Q2-2017. Production, which was set to begin in the fourth quarter of this year, has been delayed due certain shortfalls in operating with full capacity.
Qassim Cement
06-10-2016
Qassim Cement Co.’s board of directors has recommended distributing a 10% cash dividend of SAR 1 per share for Q3-2016.
Umm Al-Qura
18-09-2016
Umm Al-Qura Cement Co. started commercial operations at its new Portland cement production line. The cement producer added that it would be difficult to measure the financial impact at this stage due to supply and demand factors.
Northern Cement
10-08-2016
The board of directors of Northern Region Cement Co. approved the distribution of a 4.5% cash dividend at the rate of SAR 0.45 per share for first half of 2016.
Southern Cement
28-08-2016
Southern Province Cement Co. has started trial operations of the second production line at its Bisha plant on August 25, which will continue until it reaches its capacity of 5,000 tons of clinker a day. The company said that it doesn’t expect any financial impact at this stage, adding that it will announce further developments in due course.
Hail Cement
30-08-2016
The board of directors of Hail Cement Co. approved the distribution of a 5% cash dividend at the rate of SAR 0.50 per share for first half of 2016.
City Cement
05-11-2016
City Cement Co. has extended the trial run of its grinding unit by another three months, adding that the delay will not increase the project’s total cost.
Yamama Cement
17-10-2016
Yamama Cement Co.’s board of directors voted against distributing a cash dividend for the third quarter of 2016. The board said it wants to maintain liquidity needed to fund one of its new cement plants. Source: The Saudi Stock Exchange - Tadawul
Share in Dispatches (October 2016)
Market Share in Saudi Cement Sector (%) 15.0%
14%
8.1%
13.0%
26% 13% 4%
11.0%
90.0%
0.2%
11.2%
70.0% 50.0%
0.4%
9.0%
20.2%
-16.1%
24.8%
7.0%
13%
5% 7% 8%
-35.7%
30.0%
16.3%
10.3%
-8.4%
13.8%
-40.0%
3.0%
10%
Southern Cement Saudi Cement
5.0%
14.9%
Yanbu Cement
Yamama Cement
Qassim Cement
Arabian Cement
Eastern Cement
Najran cement
Others
-21.6% -10.0% -30.0%
1.0% -1.0%
10.0%
Yamama Saudi Eastern Qassim Yanbu Cement Cement Cement Cement Cement Share in dispatches- October 2015
Arabian Southern Tabuk Cement Cement Cement
Riyadh Najran City Northern AlJouf AlSafwa Hail -50.0% Cement Cement Cement Cement Cement Cement Cement
Share in dispatches- October 2016
% Change in Share in Dispatches (RHS)
Source: Yamamah Cement Company, AlJazira Capital
2
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Cement Dispatches for October 2016 November 2016 Saudi Cement Sector | Monthly Report | October 2016
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Dispatches & Change
Yamama Cement 50% 40% 30% 20%
400
10%
300
-10%
0%
-20%
-50%
0
-6%
1,500
-6%
6
-8%
S
O
ep
ct
-1
6
-1
6
6
-1
l-1
ug
Ju
Ju
M
A
6
n-
-1
ay
16
6
6 A
pr
-1
-1
b-
-1 O
ar
0
16
500
ct
ct
O
S
-4%
Fe
6
6
-30%
0%
1,000
-1
6
ep
-1
6
A
ug
-1
16
l-1
n-
Ju
M
Ju
6
6 -1
ay
6
-1
-1
ar
A
pr
16
M
Fe
b-
16
n-
5
D
Ja
ec
-1
5 -1
ov
N
O
ct
-1
5
0
-2%
-10% -20%
100
2,000
M
200
2%
2,500
5
300
6%
3,000
0%
16
400
8% 4%
3,500
n-
500
Change %(RHS)
4,000
Ja
10%
Clinker Inventories(1000 Ton)(LHS)
4,500
5
20%
600
5,000
-1
700
30%
-4%
500
-1
Fe b16 M ar -1 6 A pr -1 M 6 ay -1 6 Ju n16 Ju l- 1 6 A ug -1 S 6 ep -1 6 O ct -1 6
5 -1
Ja
D ec
16
Change %(RHS)
0%
1,500
-2%
n-
5
15
ct -1
ov -
O
N
Dispatches (1000 Ton)(LHS)
2%
2,000
-30%
Saudi Co SaudiCement Cement 800
4%
2,500
1,000
-40%
0
6%
3,000
ec
100
10% 8%
3,500
ov
200
Change %(RHS)
4,000
D
500
Clinker Inventories(1000 Ton)(LHS)
4,500
O ct -1 N 5 ov -1 D 5 ec -1 5 Ja n16 Fe b16 M ar -1 6 A pr -1 M 6 ay -1 6 Ju n16 Ju l-1 6 A ug -1 S 6 ep -1 6 O ct -1 6
Change %(RHS)
5
Dispatches (1000 Ton)(LHS)
600
N
700
Qassim Cement 40% 30% 20%
-10%
0
-15%
O
ct
-1
6
6
-1
S
ep
ug
-1
l-1
A
Ju
Ju
n-
6
6
-1
ay
M
A
pr
-1
-1
ar
b-
M
Fe
ct O
O
5
5 -1
-1
6
6
-50%
ct
6
-1
S
ep
6
-1
l-1
ug
Ju
A
6
Ju
n-
16
6
-1
ay
M
pr
-1
6 -1
A
M
ar
16
Fe
b-
16
Ja
n-
-1
ec
D
N
ov
-1
5 -1
ct O
5
-40%
0
5
50
6
-5%
200
6
400
-30%
16
-20%
n-
100
Ja
150
6
0%
-10%
-1
200
16
5%
600
16
800
0%
10%
250
15% 10%
5
300
Change %(RHS)
1,000
-1
350
Clinker Inventories(1000 Ton)(LHS)
1,200
ov
400
50%
ec
Change %(RHS)
D
Dispatches (1000 Ton)(LHS)
450
N
500
Souhtern Cement
6 n16 Ju l-1 6 A ug -1 S 6 ep -1 6 O ct -1 6
6
-1
Ju
M
ay
6
-1
A
pr
ar -1
b1
M
O
Fe
ct -1
-1 ct O
6
-40%
5
N ov -1 D 5 ec -1 5 Ja n16 Fe b16 M ar -1 6 A pr -1 M 6 ay -1 6 Ju n16 Ju l-1 6 A ug -1 S 6 ep -1 6 O ct -1 6
-30%
0
5
0
-20%
200
16
100
-10%
400
15
200
0%
600
n-
300
10%
800
Ja
400
20%
1,000
ec -
500
Change %(RHS) 30%
Clinker Inventories(1000 Ton)(LHS)
1,200
5
600
1,400
ov -1
700
60% 50% 40% 30% 20% 10% 0% -10% -20% -30% -40% -50%
D
Change %(RHS)
N
Dispatches (1000 Ton)(LHS)
900
800
Yanbu Cement
A
ug -
1 S 6 ep -1 6 O ct -1 6
6
Ju l-1
6
Ju n-
ay
M
16
6
-1
6
pr -1
A
M
ar -1
16
Fe b-
16
15
-6%
n-
D
ec
-1
ov
N
ct
-4%
0
Ja
-60%
-2%
500
ec -
0
0%
1,000
5
-40%
2%
1,500
-1
100
4%
2,000
ov
-20%
6%
2,500
D
200
10% 8%
5
0%
Change %(RHS)
3,000
N
300
Clinker Inventories(1000 Ton)(LHS)
3,500
-1
20%
Ja n16 Fe b16 M ar -1 6 A pr -1 M 6 ay -1 6 Ju n16 Ju l-1 6 A ug -1 S 6 ep -1 6 O ct -1 6
400
-1 5
40%
5
500
-1 5
60%
4,000
ct
80%
600
O
3
Change %(RHS)
O
Dispatches (1000 Ton)(LHS)
700
Source: Yamamah Cement Company, AlJazira Research
© All rights reserved
Cement Dispatches for October 2016 November 2016 Saudi Cement Sector | Monthly Report | October 2016
Please read Disclaimer on the back
Dispatches & Change
Arabian Cement
2% 1% 0%
6
6
ct
O
ep
S
-1
6
-1
6
-1
l-1
ug
Ju
A
6
16
-1
n-
ay
Ju
6 -1
6 M
O
-1
-1 ct
ct
pr
2,500
A
60%
-2%
16
3,000
-1%
5
6
6
3%
500
80%
6% 4%
1,000
0
7% 5%
1,500
-40%
O
Change %(RHS)
2,000
-1
6
-1
S
ep
6
-1
l-1
ug
Ju
A
6
Ju
n-
16
6
-1
M
ay
6
-1
-1
pr
A
ar
16
Fe
M
b-
16
Ja
n-
5 -1
D
ec
-1
ov
N
O
ct
-1
5
0
5
-30%
Clinker Inventories(1000 Ton)(LHS)
ar
-20%
2,500
M
-10%
50
-60%
16
0%
100
0
b-
10%
150
-40%
100
n-
40% 20%
200
-20%
200
Fe
50% 30%
250
300
Ja
300
0%
20%
5
Change %(RHS)
400
5
Dispatches (1000 Ton)(LHS)
40%
500
O ct
Eastern Co EasternCement Cement 350
600
-1
Fe b16 M ar -1 6 A pr -1 M 6 ay -1 6 Ju n16 Ju l- 1 6 A ug -1 S 6 ep -1 6 O ct -1 6
5
16
-1
n-
D ec
Ja
5
N
O
ov -
ct -1
0
15
100
60%
700
-1
200
80%
800
ec
300
Change %(RHS) 100%
Clinker Inventories(1000 Ton)(LHS)
900
D
400
1,000
-1 N 5 ov -1 D 5 ec -1 5 Ja n16 Fe b16 M ar -1 6 A pr -1 M 6 ay -1 6 Ju n16 Ju l-1 6 A ug -1 S 6 ep -1 6 O ct -1 6
500
50% 40% 30% 20% 10% 0% -10% -20% -30% -40% -50% -60%
ov
Change %(RHS)
N
Dispatches (1000 Ton)(LHS)
600
Najran Cement
-4%
6
6
ct
O
S
ep
-1
-1
ug
A
-1
6
6
16
l-1
Ju
n-
6
M
Ju
ay
-1
-1
6
6 -1
A
pr
16
ar
M
ct O
O
b-
-1
-1
5
-6%
Fe
0
-2%
5
-60%
6
6
500
ct
6
-1
ep
S
ug
-1
6
l-1
Ju
A
6
Ju
n-
16
6
-1
ay
M
pr
-1
6 -1
A
ar
16
Fe
M
b-
16
Ja
n-
5
D
ec
-1
5 -1
ov
N
O
ct
-1
5
0
-40%
16
50
0%
1,000
n-
-20%
100
Ja
150
2%
-1
0%
ov
200
4%
1,500
5
20%
250
10% 6%
2,000
-1
40%
300
Change %(RHS)
8%
ec
350
Clinker Inventories(1000 Ton)(LHS)
D
Change %(RHS)
400
N
Dispatches (1000 Ton)(LHS)
450
Northern Cement
M
pr -
A
ct O
ay -1 6 Ju n16 Ju l-1 6 A ug -1 S 6 ep -1 6 O ct -1 6
-30%
16
-20%
0
-1 6
-10%
100
-1 5
0%
200
ar
-40%
10%
300
M
0
20%
400
-1 6
-30%
O ct -1 N 5 ov -1 D 5 ec -1 5 Ja n16 Fe b16 M ar -1 6 A pr -1 M 6 ay -1 6 Ju n16 Ju l-1 6 A ug -1 S 6 ep -1 6 O ct -1 6
50
30%
500
16
-20%
50% 40%
n-
100
60%
600
Fe b
-10%
Change %(RHS)
700
Ja
0%
150
Clinker Inventories(1000 Ton)(LHS)
800
-1 5
10%
200
900
-1 5
20%
ec
30%
D
Change %(RHS)
ov
Dispatches (1000 Ton)(LHS)
250
N
300
AlJouf Cement
6 -1
-50%
O
ct
16
ep -
S
A
ug -
16
6
l-1
Ju
Ju n-
16
6 -1
ay
M
A
pr -1
6
6
6
ar -1
M
D
b1
ec -1 5 Ja n16 Fe b16 M ar -1 6 A pr -1 M 6 ay -1 6 Ju n16 Ju l-1 6 A ug -1 S 6 ep -1 6 O ct -1 6
5 -1
-1 5
ct
ov
O
N
0%
0
Fe
-50%
50%
200
16
0
-40%
n-
-30%
100%
400
Ja
50
150%
600
15
-20%
200%
800
5
-10%
100
250%
1,000
ec -
0%
Change %(RHS) 300%
Clinker Inventories(1000 Ton)(LHS)
1,200
D
10%
1,400
5
20%
150
4
30%
ov -1
200
40%
N
Change %(RHS)
ct -1
Dispatches (1000 Ton)(LHS)
O
250
Source: Yamamah Cement Company, AlJazira Research
© All rights reserved
Cement Dispatches for October 2016 November 2016 Saudi Cement Sector | Monthly Report | October 2016
Please read Disclaimer on the back
Dispatches & Change
Tabuk Cement
100%
0%
600
50%
-20%
400
0%
-40%
200
-50%
-60%
0
6
6
-10%
S
O
ep
ct
-1
6
-1
6
-1
l-1
ug
Ju
A
6
16
-1
n-
ay
Ju
M
-1 ct O
O
6
-5%
6
0
-1
-60%
6
6
200
ct
-1
ep
S
0%
-40%
-1
6
6
-1
l-1
ug
Ju
Ju
M
A
n-
6
16
6
-1
ay
6
-1
-1
A
pr
ar
16
b-
16
Fe
M
D
Ja
n-
5
ec
-1
5 -1
ov
N
O
ct
-1
5
0
5%
400
-1
50
10%
600
pr
-20%
100
800
A
150
15%
16
0%
25% 20%
ar
200
Change %(RHS)
1,000
M
20%
250
Clinker Inventories(1000 Ton)(LHS)
-100%
1,200
16
40%
300
1,400
b-
60%
n-
Change %(RHS)
Fe
Dispatches (1000 Ton)(LHS)
350
Ja
400
5
City Co CityCement Cement
5
Fe b16 M ar -1 6 A pr -1 M 6 ay -1 6 Ju n16 Ju l- 1 6 A ug -1 S 6 ep -1 6 O ct -1 6
5
16
-1
20%
n-
Ja
D ec
N
O
ov -
ct -1
5
0
15
20
150%
800
-1
40
1,000
-1
60
40%
ec
80
Change %(RHS) 200%
Clinker Inventories(1000 Ton)(LHS)
ov
100
1,200
N
120
60%
D
Change %(RHS)
O ct -1 N 5 ov -1 D 5 ec -1 5 Ja n16 Fe b16 M ar -1 6 A pr -1 M 6 ay -1 6 Ju n16 Ju l-1 6 A ug -1 S 6 ep -1 6 O ct -1 6
Dispatches (1000 Ton)(LHS)
140
5
160
Hail Cement
6
-10%
O
ct
-1
6
6 -1
ep
S
ug
-1
6 A
Ju
l-1
16
n-
Ju
M
ay
-1
6
6
6
-1
A
pr
16
-1
ar
M
b-
-1 ct O
O
ov
6
-1
6
0
ct
6
-1
ep
S
ug
-1
6
l-1
A
Ju
Ju
n-
16
6
6 -1
M
ay
-1
6 -1
ar
A
pr
16
M
Fe
b-
16
n-
Ja
D
ec
-1
5
5
ov
-1
5 -1 ct
N
-5%
200
Fe
-50%
0
16
-40%
20
0%
400
n-
-30%
40
600
Ja
-20%
60
5%
5
-10%
80
800
-1
0%
100
10%
1,000
ec
10%
120
Change %(RHS) 15%
1,200
5
20%
140
Clinker Inventories(1000 Ton)(LHS)
1,400
-1
40% 30%
160
O
50%
D
Change %(RHS)
5
Dispatches (1000 Ton)(LHS)
180
N
200
Riyadh Cement 1,700
20%
1,650
6
O
ct
-1
6 -1
S ep
A
ug -
16
6
6
l-1
Ju
n1
Ju
M
ay
-1
6
6
6
-1
A
pr
ar -1
ct -1
6
-8%
O
ct O
-6%
1,350
M
N ov -1 D 5 ec -1 5 Ja n16 Fe b16 M ar -1 6 A pr -1 M 6 ay -1 6 Ju n16 Ju l-1 6 A ug -1 S 6 ep -1 6 O ct -1 6
-50%
-1
5
-40%
1,400
b1
50
-4%
1,450
Fe
-30%
-2%
1,500
16
100
0%
1,550
n-
-20%
6%
2%
1,600
Ja
-10%
150
Change %(RHS)
4%
15
0%
200
Clinker Inventories(1000 Ton)(LHS)
ec -
10%
250
0
30%
1,750
5
300
1,800
40%
ov -1
350
50%
D
Change %(RHS)
5
Dispatches (1000 Ton)(LHS)
400
N
450
Safwa Cement 80%
-60%
M
A
pr -1
ar -1
M
b1
n-
Fe
Ja
ec -
D
D
ec -1 5 Ja n16 Fe b16 M ar -1 6 A pr -1 M 6 ay -1 6 Ju n16 Ju l-1 6 A ug -1 S 6 ep -1 6 O ct -1 6
5 -1
ov
N
ay -1 6 Ju n16 Ju l-1 6 A ug -1 S 6 ep -1 6 O ct -1 6
0
6
-40%
-60%
6
50
6
-20%
-40%
16
100
15
0%
-20%
5
20%
150
0%
5
40%
100
-1 5
80%
200
20%
ct
100% 60%
40%
O
Change %(RHS)
250
150
0
Clinker Inventories(1000 Ton)(LHS)
350 300
60%
50
400
ct -1
200
5
100%
ov -1
Change %(RHS)
N
Dispatches (1000 Ton)(LHS)
O
250
Source: Yamamah Cement Company, AlJazira Research
© All rights reserved
RESEARCH DIVISION
Acting Head of Research
RESEARCH DIVISION
BROKERAGE AND INVESTMENT CENTERS DIVISION
Talha Nazar
Sultan Al Kadi
Analyst
Jassim Al-Jubran
+966 11 2256250 [email protected]
+966 11 2256374 [email protected]
Analyst
Analyst
Waleed Al-jubayr
Muhanad Al-Odan
+966 11 2256146 [email protected]
+966 11 2256115 [email protected]
General Manager – Brokerage Services &
AGM-Head of international and institutional
AGM- Head of Western and Southern Region Investment Centers & ADC
sales
brokerage
Brokerage
Alaa Al-Yousef
Luay Jawad Al-Motawa
Mansour Hamad Al-shuaibi
+966 11 2256060 [email protected]
+966 11 2256277 [email protected]
+966 12 6618443 [email protected]
AGM-Head of Sales And Investment Centers
AGM-Head of Qassim & Eastern Province
Central Region
Abdullah Al-Rahit
Sultan Ibrahim AL-Mutawa
+966 16 3617547 [email protected]
+966 11 2256364 [email protected]
+966 11 2256248 [email protected]
AlJazira Capital, the investment arm of Bank AlJazira, is a Shariaa Compliant Saudi Closed Joint Stock company and operating under the regulatory supervision of the Capital Market Authority. AlJazira Capital is licensed to conduct securities business in all securities business as authorized by CMA, including dealing, managing, arranging, advisory, and custody. AlJazira Capital is the continuation of a long success story in the Saudi Tadawul market, having occupied the market leadership position for several years. With an objective to maintain its market leadership position, AlJazira Capital is expanding its brokerage capabilities to offer further value-added services, brokerage across MENA and International markets, as well as offering a full suite of securities business. 1.
RATING TERMINOLOGY
Analyst
2. 3. 4.
Overweight: This rating implies that the stock is currently trading at a discount to its 12 months price target. Stocks rated “Overweight” will typically provide an upside potential of over 10% from the current price levels over next twelve months. Underweight: This rating implies that the stock is currently trading at a premium to its 12 months price target. Stocks rated “Underweight” would typically decline by over 10% from the current price levels over next twelve months. Neutral: The rating implies that the stock is trading in the proximate range of its 12 months price target. Stocks rated “Neutral” is expected to stagnate within +/- 10% range from the current price levels over next twelve months. Suspension of rating or rating on hold (SR/RH): This basically implies suspension of a rating pending further analysis of a material change in the fundamentals of the company.
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Cement Dispatches: Growth of 29.2%MoM, a decline of 14.4%YoY; Clinker Dispatches Growth inventories recorded a historical high: According to the data released by Yamamah Dispatches (1000 Ton)(LHS) compared to 5.1mn tons in October-2015, depicting a decline of 14.4%YoY, and growth of 29.2%MoM.
60.0%
Change %(RHS)
6,000
40.0%
5,000
20.0%
Thousand Tonne
cement Co, cement dispatches for the month of October-2016 stood at 4.4mn tons,
4,000
Overview: The recorded MoM growth is attributed to the impact of Hajj season that
0.0%
3,000
discontinued projects. We expect to witness growth in dispatches for the next two
Oct-16
Sep-16
Jul-16
Aug-16
Jun-16
Apr-16
May-16
Mar-16
-40.0%
Jan-16
1,000
6.3%YoY, mostly due to weak demand and lower awarded contracts, in addition to
Feb-16
declined from 50.2mn tons in 2015 to 47.1mn tons in 2016 depicting a decline of
Dec-15
-20.0%
Oct-15
2,000
Nov-15
resulted in slowdown in construction during 3Q-2016. For 10M-2016, Cement sales
Source : Yamama Cement Company, AlJazira Research
months on the same pace after the seasonality impact in 3Q-2016.
Share in Dispatches by Regions
On MoM basis, all cement companies showed growth in dispatches, except AlJouf
Regions
Share in Dispatches Share in Inventory Oct-15 Oct-16 10M-2016 Oct-15 Oct-16
cement which recorded a decline of 5.6%. AlSafwa cement showed the highest growth
“Central Region”
27.19% 30.21% 29.08% 29.38% 28.84%
by 75.0%MoM followed by Yanbu cement with a growth of 61.4%MoM. On YoY basis,
“Western Region” 22.63% 23.04% 21.91% 18.89% 17.14%
Tabuk and Qassim cement were the only companies to show growth in cement dispatches, recording an increase of 6.9%YoY and 2.9%YoY respectively. Northern
“Southern Region” 20.80% 18.32% 19.17% 16.36% 15.30% “Eastern Region”
17.46% 18.03% 17.90% 22.21% 23.37%
“Northern Region” 11.93% 10.40% 11.94% 13.16% 15.35%
cement and Najran cement witnessed a fall of 48.6%YoY and 45.0%YoY respectively.
Key Performance: Data/Ratios Despite the decrease in Clinker production, Clinker inventories recorded new Market Cap(bn) highs: Clinker inventory continued to increase reaching a new historical high of P/E (TTM)
49.0 9.29x
27.1mn ton depicting an increase of 17.1%YoY due to weak demand and higher P/B
1.43x
Dividend Yield: production to sales ratio. Northern cement showed an increase of 12.5%MoM in YTD (%) clinker inventory , followed by City cement which showed increase of 10.4%MoM. ROA On the other hand, Aljouf and Saudi cement companies’ clinker inventory witnessed ROE
9.97% -19.72% 12.06% 15.83%
Source : Yamama Cement Company, AlJazira Research
Oct-16
Aug-16
Sep-16
Clinker Inventories(1000 Ton)(LHS)
Jul-16
Jun-16
0
May-16
5,000
Apr-16
2015 to 4.5% in October 2016.
10,000
Mar-16
4.2% in October-2015, followed by Najran cement as it declined from 7.0% in October
15,000
Feb-16
cement company market share declined to 2.5% in October-2016 as compared to
20,000
Jan-16
cement increased its market share from 6.7% to 8.1%. On the other hand, Northern
14% 12% 10% 8% 6% 4% 2% 0% -2%
25,000
Dec-15
it increased from 2.0% in October-2015 to 2.5% in October-2016. Moreover, Qassim
Invenories Level 30,000
Oct-15
Market Share: Tabuk cement showed an improvement in its market share YOY as
Nov-15
a decrease of 5.1%MoM and 2.1%MoM respectively.
-4%
Change %(RHS)
Key Data Dispatches Region “Central Region”
“Western Region” “Eastern Region” “Southern Region” “Northern Region”
Companies
Sep-16
Oct-15
Oct-16
Yamamah Cement City Cement Qassim Cement Riyadh Cement Total Yanbu Cement Arabian Cement AlSafwa Cement Total Saudi Cement Eastern Cement Total Najran Cement Southern Cement Total Northern Cement AlJouf Cement Tabuk Cement Hail Cement Total Total
355 175 273 247 1,050 347 220 88 655 461 142 603 167 505 672 94 144 86 95 419 3,399
514 236 345 300 1,395 588 415 158 1,161 632 264 896 358 709 1,067 214 144 102 152 612 5,131
442 235 355 295 1,327 560 298 154 1,012 585 207 792 197 608 805 110 136 109 102 457 4,393
%Change M/M 24.5% 34.3% 30.0% 19.4% 26.4% 61.4% 35.5% 75.0% 54.5% 26.9% 45.8% 31.3% 18.0% 20.4% 19.8% 17.0% -5.6% 26.7% 7.4% 9.1% 29.2%
% change Y/Y -14.0% -0.4% 2.9% -1.7% -4.9% -4.8% -28.2% -2.5% -12.8% -7.4% -21.6% -11.6% -45.0% -14.2% -24.6% -48.6% -5.6% 6.9% -32.9% -25.3% -14.4%
Clinker Inventory Levels 10M-15 4,788 2,122 3,563 2,738 13211 5,728 4,381 1,542 11650 6,383 2,546 8929 3,683 6,968 10651 1,912 1,381 1,075 1,432 5,800 50,240
% 10M-2016 Change 4,595 2,590 3,436 3,067 13,688 5,003 3,790 1,521 10,314 6,254 2,170 8,424 2,510 6,512 9,022 1,652 1,600 1,146 1,224 5,622 47,070
-4.0% 22.1% -3.6% 12.0% 3.6% -12.6% -13.5% -1.4% -11.5% -2.0% -14.8% -5.7% -31.8% -6.5% -15.3% -13.6% 15.8% 6.6% -14.5% -3.1% -6.3%
Sep-16
Oct-15
Oct-16
3,981 1,091 919 1,610 7,601 3,664 664 312 4,640 4,508 1,868 6,376 2,751 1,244 3,995 662 1,201 928 1,230 4,021 26,633
3,363 754 961 1,715 6793 3,390 873 106 4369 3,712 1,423 5135 2,547 1,237 3784 769 628 801 846 3,044 23,125
4,054 1,204 925 1,624 7,807 3,646 653 342 4,641 4,414 1,914 6,328 2,840 1,301 4,141 745 1,140 960 1,311 4,156 27,073
YoY % Change 20.5% 59.7% -3.7% -5.3% 14.9% 7.6% -25.2% 222.6% 6.2% 18.9% 34.5% 23.2% 11.5% 5.2% 9.4% -3.1% 81.5% 19.9% 55.0% 36.5% 17.1%
MoM % Change 1.8% 10.4% 0.7% 0.9% 2.7% -0.5% -1.7% 9.6% 0.0% -2.1% 2.5% -0.8% 3.2% 4.6% 3.7% 12.5% -5.1% 3.4% 6.6% 3.4% 1.7%
Source: Yamamah Cement Company, AlJazira Capital
1
Analyst
Analyst
Jassim Al-Jubran
Waleed Al-jubayr
+966 11 2256248 [email protected]
+966 11 2256146 [email protected]
© All rights reserved
Cement Dispatches for October 2016 November 2016 Saudi Cement Sector | Monthly Report | October 2016
Please read Disclaimer on the back
Company News & Events Date of Company Name Announcement
Corporate Event & Announcement
Tabuk Cement
29-09-2016
Tabuk Cement Co. will begin commercial operations at its second production line in Q2-2017. Production, which was set to begin in the fourth quarter of this year, has been delayed due certain shortfalls in operating with full capacity.
Qassim Cement
06-10-2016
Qassim Cement Co.’s board of directors has recommended distributing a 10% cash dividend of SAR 1 per share for Q3-2016.
Umm Al-Qura
18-09-2016
Umm Al-Qura Cement Co. started commercial operations at its new Portland cement production line. The cement producer added that it would be difficult to measure the financial impact at this stage due to supply and demand factors.
Northern Cement
10-08-2016
The board of directors of Northern Region Cement Co. approved the distribution of a 4.5% cash dividend at the rate of SAR 0.45 per share for first half of 2016.
Southern Cement
28-08-2016
Southern Province Cement Co. has started trial operations of the second production line at its Bisha plant on August 25, which will continue until it reaches its capacity of 5,000 tons of clinker a day. The company said that it doesn’t expect any financial impact at this stage, adding that it will announce further developments in due course.
Hail Cement
30-08-2016
The board of directors of Hail Cement Co. approved the distribution of a 5% cash dividend at the rate of SAR 0.50 per share for first half of 2016.
City Cement
05-11-2016
City Cement Co. has extended the trial run of its grinding unit by another three months, adding that the delay will not increase the project’s total cost.
Yamama Cement
17-10-2016
Yamama Cement Co.’s board of directors voted against distributing a cash dividend for the third quarter of 2016. The board said it wants to maintain liquidity needed to fund one of its new cement plants. Source: The Saudi Stock Exchange - Tadawul
Share in Dispatches (October 2016)
Market Share in Saudi Cement Sector (%) 15.0%
14%
8.1%
13.0%
26% 13% 4%
11.0%
90.0%
0.2%
11.2%
70.0% 50.0%
0.4%
9.0%
20.2%
-16.1%
24.8%
7.0%
13%
5% 7% 8%
-35.7%
30.0%
16.3%
10.3%
-8.4%
13.8%
-40.0%
3.0%
10%
Southern Cement Saudi Cement
5.0%
14.9%
Yanbu Cement
Yamama Cement
Qassim Cement
Arabian Cement
Eastern Cement
Najran cement
Others
-21.6% -10.0% -30.0%
1.0% -1.0%
10.0%
Yamama Saudi Eastern Qassim Yanbu Cement Cement Cement Cement Cement Share in dispatches- October 2015
Arabian Southern Tabuk Cement Cement Cement
Riyadh Najran City Northern AlJouf AlSafwa Hail -50.0% Cement Cement Cement Cement Cement Cement Cement
Share in dispatches- October 2016
% Change in Share in Dispatches (RHS)
Source: Yamamah Cement Company, AlJazira Capital
2
© All rights reserved
Cement Dispatches for October 2016 November 2016 Saudi Cement Sector | Monthly Report | October 2016
Please read Disclaimer on the back
Dispatches & Change
Yamama Cement 50% 40% 30% 20%
400
10%
300
-10%
0%
-20%
-50%
0
-6%
1,500
-6%
6
-8%
S
O
ep
ct
-1
6
-1
6
6
-1
l-1
ug
Ju
Ju
M
A
6
n-
-1
ay
16
6
6 A
pr
-1
-1
b-
-1 O
ar
0
16
500
ct
ct
O
S
-4%
Fe
6
6
-30%
0%
1,000
-1
6
ep
-1
6
A
ug
-1
16
l-1
n-
Ju
M
Ju
6
6 -1
ay
6
-1
-1
ar
A
pr
16
M
Fe
b-
16
n-
5
D
Ja
ec
-1
5 -1
ov
N
O
ct
-1
5
0
-2%
-10% -20%
100
2,000
M
200
2%
2,500
5
300
6%
3,000
0%
16
400
8% 4%
3,500
n-
500
Change %(RHS)
4,000
Ja
10%
Clinker Inventories(1000 Ton)(LHS)
4,500
5
20%
600
5,000
-1
700
30%
-4%
500
-1
Fe b16 M ar -1 6 A pr -1 M 6 ay -1 6 Ju n16 Ju l- 1 6 A ug -1 S 6 ep -1 6 O ct -1 6
5 -1
Ja
D ec
16
Change %(RHS)
0%
1,500
-2%
n-
5
15
ct -1
ov -
O
N
Dispatches (1000 Ton)(LHS)
2%
2,000
-30%
Saudi Co SaudiCement Cement 800
4%
2,500
1,000
-40%
0
6%
3,000
ec
100
10% 8%
3,500
ov
200
Change %(RHS)
4,000
D
500
Clinker Inventories(1000 Ton)(LHS)
4,500
O ct -1 N 5 ov -1 D 5 ec -1 5 Ja n16 Fe b16 M ar -1 6 A pr -1 M 6 ay -1 6 Ju n16 Ju l-1 6 A ug -1 S 6 ep -1 6 O ct -1 6
Change %(RHS)
5
Dispatches (1000 Ton)(LHS)
600
N
700
Qassim Cement 40% 30% 20%
-10%
0
-15%
O
ct
-1
6
6
-1
S
ep
ug
-1
l-1
A
Ju
Ju
n-
6
6
-1
ay
M
A
pr
-1
-1
ar
b-
M
Fe
ct O
O
5
5 -1
-1
6
6
-50%
ct
6
-1
S
ep
6
-1
l-1
ug
Ju
A
6
Ju
n-
16
6
-1
ay
M
pr
-1
6 -1
A
M
ar
16
Fe
b-
16
Ja
n-
-1
ec
D
N
ov
-1
5 -1
ct O
5
-40%
0
5
50
6
-5%
200
6
400
-30%
16
-20%
n-
100
Ja
150
6
0%
-10%
-1
200
16
5%
600
16
800
0%
10%
250
15% 10%
5
300
Change %(RHS)
1,000
-1
350
Clinker Inventories(1000 Ton)(LHS)
1,200
ov
400
50%
ec
Change %(RHS)
D
Dispatches (1000 Ton)(LHS)
450
N
500
Souhtern Cement
6 n16 Ju l-1 6 A ug -1 S 6 ep -1 6 O ct -1 6
6
-1
Ju
M
ay
6
-1
A
pr
ar -1
b1
M
O
Fe
ct -1
-1 ct O
6
-40%
5
N ov -1 D 5 ec -1 5 Ja n16 Fe b16 M ar -1 6 A pr -1 M 6 ay -1 6 Ju n16 Ju l-1 6 A ug -1 S 6 ep -1 6 O ct -1 6
-30%
0
5
0
-20%
200
16
100
-10%
400
15
200
0%
600
n-
300
10%
800
Ja
400
20%
1,000
ec -
500
Change %(RHS) 30%
Clinker Inventories(1000 Ton)(LHS)
1,200
5
600
1,400
ov -1
700
60% 50% 40% 30% 20% 10% 0% -10% -20% -30% -40% -50%
D
Change %(RHS)
N
Dispatches (1000 Ton)(LHS)
900
800
Yanbu Cement
A
ug -
1 S 6 ep -1 6 O ct -1 6
6
Ju l-1
6
Ju n-
ay
M
16
6
-1
6
pr -1
A
M
ar -1
16
Fe b-
16
15
-6%
n-
D
ec
-1
ov
N
ct
-4%
0
Ja
-60%
-2%
500
ec -
0
0%
1,000
5
-40%
2%
1,500
-1
100
4%
2,000
ov
-20%
6%
2,500
D
200
10% 8%
5
0%
Change %(RHS)
3,000
N
300
Clinker Inventories(1000 Ton)(LHS)
3,500
-1
20%
Ja n16 Fe b16 M ar -1 6 A pr -1 M 6 ay -1 6 Ju n16 Ju l-1 6 A ug -1 S 6 ep -1 6 O ct -1 6
400
-1 5
40%
5
500
-1 5
60%
4,000
ct
80%
600
O
3
Change %(RHS)
O
Dispatches (1000 Ton)(LHS)
700
Source: Yamamah Cement Company, AlJazira Research
© All rights reserved
Cement Dispatches for October 2016 November 2016 Saudi Cement Sector | Monthly Report | October 2016
Please read Disclaimer on the back
Dispatches & Change
Arabian Cement
2% 1% 0%
6
6
ct
O
ep
S
-1
6
-1
6
-1
l-1
ug
Ju
A
6
16
-1
n-
ay
Ju
6 -1
6 M
O
-1
-1 ct
ct
pr
2,500
A
60%
-2%
16
3,000
-1%
5
6
6
3%
500
80%
6% 4%
1,000
0
7% 5%
1,500
-40%
O
Change %(RHS)
2,000
-1
6
-1
S
ep
6
-1
l-1
ug
Ju
A
6
Ju
n-
16
6
-1
M
ay
6
-1
-1
pr
A
ar
16
Fe
M
b-
16
Ja
n-
5 -1
D
ec
-1
ov
N
O
ct
-1
5
0
5
-30%
Clinker Inventories(1000 Ton)(LHS)
ar
-20%
2,500
M
-10%
50
-60%
16
0%
100
0
b-
10%
150
-40%
100
n-
40% 20%
200
-20%
200
Fe
50% 30%
250
300
Ja
300
0%
20%
5
Change %(RHS)
400
5
Dispatches (1000 Ton)(LHS)
40%
500
O ct
Eastern Co EasternCement Cement 350
600
-1
Fe b16 M ar -1 6 A pr -1 M 6 ay -1 6 Ju n16 Ju l- 1 6 A ug -1 S 6 ep -1 6 O ct -1 6
5
16
-1
n-
D ec
Ja
5
N
O
ov -
ct -1
0
15
100
60%
700
-1
200
80%
800
ec
300
Change %(RHS) 100%
Clinker Inventories(1000 Ton)(LHS)
900
D
400
1,000
-1 N 5 ov -1 D 5 ec -1 5 Ja n16 Fe b16 M ar -1 6 A pr -1 M 6 ay -1 6 Ju n16 Ju l-1 6 A ug -1 S 6 ep -1 6 O ct -1 6
500
50% 40% 30% 20% 10% 0% -10% -20% -30% -40% -50% -60%
ov
Change %(RHS)
N
Dispatches (1000 Ton)(LHS)
600
Najran Cement
-4%
6
6
ct
O
S
ep
-1
-1
ug
A
-1
6
6
16
l-1
Ju
n-
6
M
Ju
ay
-1
-1
6
6 -1
A
pr
16
ar
M
ct O
O
b-
-1
-1
5
-6%
Fe
0
-2%
5
-60%
6
6
500
ct
6
-1
ep
S
ug
-1
6
l-1
Ju
A
6
Ju
n-
16
6
-1
ay
M
pr
-1
6 -1
A
ar
16
Fe
M
b-
16
Ja
n-
5
D
ec
-1
5 -1
ov
N
O
ct
-1
5
0
-40%
16
50
0%
1,000
n-
-20%
100
Ja
150
2%
-1
0%
ov
200
4%
1,500
5
20%
250
10% 6%
2,000
-1
40%
300
Change %(RHS)
8%
ec
350
Clinker Inventories(1000 Ton)(LHS)
D
Change %(RHS)
400
N
Dispatches (1000 Ton)(LHS)
450
Northern Cement
M
pr -
A
ct O
ay -1 6 Ju n16 Ju l-1 6 A ug -1 S 6 ep -1 6 O ct -1 6
-30%
16
-20%
0
-1 6
-10%
100
-1 5
0%
200
ar
-40%
10%
300
M
0
20%
400
-1 6
-30%
O ct -1 N 5 ov -1 D 5 ec -1 5 Ja n16 Fe b16 M ar -1 6 A pr -1 M 6 ay -1 6 Ju n16 Ju l-1 6 A ug -1 S 6 ep -1 6 O ct -1 6
50
30%
500
16
-20%
50% 40%
n-
100
60%
600
Fe b
-10%
Change %(RHS)
700
Ja
0%
150
Clinker Inventories(1000 Ton)(LHS)
800
-1 5
10%
200
900
-1 5
20%
ec
30%
D
Change %(RHS)
ov
Dispatches (1000 Ton)(LHS)
250
N
300
AlJouf Cement
6 -1
-50%
O
ct
16
ep -
S
A
ug -
16
6
l-1
Ju
Ju n-
16
6 -1
ay
M
A
pr -1
6
6
6
ar -1
M
D
b1
ec -1 5 Ja n16 Fe b16 M ar -1 6 A pr -1 M 6 ay -1 6 Ju n16 Ju l-1 6 A ug -1 S 6 ep -1 6 O ct -1 6
5 -1
-1 5
ct
ov
O
N
0%
0
Fe
-50%
50%
200
16
0
-40%
n-
-30%
100%
400
Ja
50
150%
600
15
-20%
200%
800
5
-10%
100
250%
1,000
ec -
0%
Change %(RHS) 300%
Clinker Inventories(1000 Ton)(LHS)
1,200
D
10%
1,400
5
20%
150
4
30%
ov -1
200
40%
N
Change %(RHS)
ct -1
Dispatches (1000 Ton)(LHS)
O
250
Source: Yamamah Cement Company, AlJazira Research
© All rights reserved
Cement Dispatches for October 2016 November 2016 Saudi Cement Sector | Monthly Report | October 2016
Please read Disclaimer on the back
Dispatches & Change
Tabuk Cement
100%
0%
600
50%
-20%
400
0%
-40%
200
-50%
-60%
0
6
6
-10%
S
O
ep
ct
-1
6
-1
6
-1
l-1
ug
Ju
A
6
16
-1
n-
ay
Ju
M
-1 ct O
O
6
-5%
6
0
-1
-60%
6
6
200
ct
-1
ep
S
0%
-40%
-1
6
6
-1
l-1
ug
Ju
Ju
M
A
n-
6
16
6
-1
ay
6
-1
-1
A
pr
ar
16
b-
16
Fe
M
D
Ja
n-
5
ec
-1
5 -1
ov
N
O
ct
-1
5
0
5%
400
-1
50
10%
600
pr
-20%
100
800
A
150
15%
16
0%
25% 20%
ar
200
Change %(RHS)
1,000
M
20%
250
Clinker Inventories(1000 Ton)(LHS)
-100%
1,200
16
40%
300
1,400
b-
60%
n-
Change %(RHS)
Fe
Dispatches (1000 Ton)(LHS)
350
Ja
400
5
City Co CityCement Cement
5
Fe b16 M ar -1 6 A pr -1 M 6 ay -1 6 Ju n16 Ju l- 1 6 A ug -1 S 6 ep -1 6 O ct -1 6
5
16
-1
20%
n-
Ja
D ec
N
O
ov -
ct -1
5
0
15
20
150%
800
-1
40
1,000
-1
60
40%
ec
80
Change %(RHS) 200%
Clinker Inventories(1000 Ton)(LHS)
ov
100
1,200
N
120
60%
D
Change %(RHS)
O ct -1 N 5 ov -1 D 5 ec -1 5 Ja n16 Fe b16 M ar -1 6 A pr -1 M 6 ay -1 6 Ju n16 Ju l-1 6 A ug -1 S 6 ep -1 6 O ct -1 6
Dispatches (1000 Ton)(LHS)
140
5
160
Hail Cement
6
-10%
O
ct
-1
6
6 -1
ep
S
ug
-1
6 A
Ju
l-1
16
n-
Ju
M
ay
-1
6
6
6
-1
A
pr
16
-1
ar
M
b-
-1 ct O
O
ov
6
-1
6
0
ct
6
-1
ep
S
ug
-1
6
l-1
A
Ju
Ju
n-
16
6
6 -1
M
ay
-1
6 -1
ar
A
pr
16
M
Fe
b-
16
n-
Ja
D
ec
-1
5
5
ov
-1
5 -1 ct
N
-5%
200
Fe
-50%
0
16
-40%
20
0%
400
n-
-30%
40
600
Ja
-20%
60
5%
5
-10%
80
800
-1
0%
100
10%
1,000
ec
10%
120
Change %(RHS) 15%
1,200
5
20%
140
Clinker Inventories(1000 Ton)(LHS)
1,400
-1
40% 30%
160
O
50%
D
Change %(RHS)
5
Dispatches (1000 Ton)(LHS)
180
N
200
Riyadh Cement 1,700
20%
1,650
6
O
ct
-1
6 -1
S ep
A
ug -
16
6
6
l-1
Ju
n1
Ju
M
ay
-1
6
6
6
-1
A
pr
ar -1
ct -1
6
-8%
O
ct O
-6%
1,350
M
N ov -1 D 5 ec -1 5 Ja n16 Fe b16 M ar -1 6 A pr -1 M 6 ay -1 6 Ju n16 Ju l-1 6 A ug -1 S 6 ep -1 6 O ct -1 6
-50%
-1
5
-40%
1,400
b1
50
-4%
1,450
Fe
-30%
-2%
1,500
16
100
0%
1,550
n-
-20%
6%
2%
1,600
Ja
-10%
150
Change %(RHS)
4%
15
0%
200
Clinker Inventories(1000 Ton)(LHS)
ec -
10%
250
0
30%
1,750
5
300
1,800
40%
ov -1
350
50%
D
Change %(RHS)
5
Dispatches (1000 Ton)(LHS)
400
N
450
Safwa Cement 80%
-60%
M
A
pr -1
ar -1
M
b1
n-
Fe
Ja
ec -
D
D
ec -1 5 Ja n16 Fe b16 M ar -1 6 A pr -1 M 6 ay -1 6 Ju n16 Ju l-1 6 A ug -1 S 6 ep -1 6 O ct -1 6
5 -1
ov
N
ay -1 6 Ju n16 Ju l-1 6 A ug -1 S 6 ep -1 6 O ct -1 6
0
6
-40%
-60%
6
50
6
-20%
-40%
16
100
15
0%
-20%
5
20%
150
0%
5
40%
100
-1 5
80%
200
20%
ct
100% 60%
40%
O
Change %(RHS)
250
150
0
Clinker Inventories(1000 Ton)(LHS)
350 300
60%
50
400
ct -1
200
5
100%
ov -1
Change %(RHS)
N
Dispatches (1000 Ton)(LHS)
O
250
Source: Yamamah Cement Company, AlJazira Research
© All rights reserved
RESEARCH DIVISION
Acting Head of Research
RESEARCH DIVISION
BROKERAGE AND INVESTMENT CENTERS DIVISION
Talha Nazar
Sultan Al Kadi
Analyst
Jassim Al-Jubran
+966 11 2256250 [email protected]
+966 11 2256374 [email protected]
Analyst
Analyst
Waleed Al-jubayr
Muhanad Al-Odan
+966 11 2256146 [email protected]
+966 11 2256115 [email protected]
General Manager – Brokerage Services &
AGM-Head of international and institutional
AGM- Head of Western and Southern Region Investment Centers & ADC
sales
brokerage
Brokerage
Alaa Al-Yousef
Luay Jawad Al-Motawa
Mansour Hamad Al-shuaibi
+966 11 2256060 [email protected]
+966 11 2256277 [email protected]
+966 12 6618443 [email protected]
AGM-Head of Sales And Investment Centers
AGM-Head of Qassim & Eastern Province
Central Region
Abdullah Al-Rahit
Sultan Ibrahim AL-Mutawa
+966 16 3617547 [email protected]
+966 11 2256364 [email protected]
+966 11 2256248 [email protected]
AlJazira Capital, the investment arm of Bank AlJazira, is a Shariaa Compliant Saudi Closed Joint Stock company and operating under the regulatory supervision of the Capital Market Authority. AlJazira Capital is licensed to conduct securities business in all securities business as authorized by CMA, including dealing, managing, arranging, advisory, and custody. AlJazira Capital is the continuation of a long success story in the Saudi Tadawul market, having occupied the market leadership position for several years. With an objective to maintain its market leadership position, AlJazira Capital is expanding its brokerage capabilities to offer further value-added services, brokerage across MENA and International markets, as well as offering a full suite of securities business. 1.
RATING TERMINOLOGY
Analyst
2. 3. 4.
Overweight: This rating implies that the stock is currently trading at a discount to its 12 months price target. Stocks rated “Overweight” will typically provide an upside potential of over 10% from the current price levels over next twelve months. Underweight: This rating implies that the stock is currently trading at a premium to its 12 months price target. Stocks rated “Underweight” would typically decline by over 10% from the current price levels over next twelve months. Neutral: The rating implies that the stock is trading in the proximate range of its 12 months price target. Stocks rated “Neutral” is expected to stagnate within +/- 10% range from the current price levels over next twelve months. Suspension of rating or rating on hold (SR/RH): This basically implies suspension of a rating pending further analysis of a material change in the fundamentals of the company.
Disclaimer The purpose of producing this report is to present a general view on the company/economic sector/economic subject under research, and not to recommend a buy/sell/hold for any security or any other assets. Based on that, this report does not take into consideration the specific financial position of every investor and/or his/her risk appetite in relation to investing in the security or any other assets, and hence, may not be suitable for all clients depending on their financial position and their ability and willingness to undertake risks. It is advised that every potential investor seek professional advice from several sources concerning investment decision and should study the impact of such decisions on his/her financial/legal/tax position and other concerns before getting into such investments or liquidate them partially or fully. The market of stocks, bonds, macroeconomic or microeconomic variables are of a volatile nature and could witness sudden changes without any prior warning, therefore, the investor in securities or other assets might face some unexpected risks and fluctuations. All the information, views and expectations and fair values or target prices contained in this report have been compiled or arrived at by Aljazira Capital from sources believed to be reliable, but Aljazira Capital has not independently verified the contents obtained from these sources and such information may be condensed or incomplete. Accordingly, no representation or warranty, express or implied, is made as to, and no reliance should be placed on the fairness, accuracy, completeness or correctness of the information and opinions contained in this report. Aljazira Capital shall not be liable for any loss as that may arise from the use of this report or its contents or otherwise arising in connection therewith. The past performance of any investment is not an indicator of future performance. Any financial projections, fair value estimates or price targets and statements regarding future prospects contained in this document may not be realized. The value of the security or any other assets or the return from them might increase or decrease. Any change in currency rates may have a positive or negative impact on the value/return on the stock or securities mentioned in the report. The investor might get an amount less than the amount invested in some cases. Some stocks or securities maybe, by nature, of low volume/trades or may become like that unexpectedly in special circumstances and this might increase the risk on the investor. Some fees might be levied on some investments in securities. This report has been written by professional employees in Aljazira Capital, and they undertake that neither them, nor their wives or children hold positions directly in any listed shares or securities contained in this report during the time of publication of this report, however, The authors and/or their wives/children of this document may own securities in funds open to the public that invest in the securities mentioned in this document as part of a diversified portfolio over which they have no discretion. This report has been produced independently and separately by the Research Division at Aljazira Capital and no party (in-house or outside) who might have interest whether direct or indirect have seen the contents of this report before its publishing, except for those whom corporate positions allow them to do so, and/or third-party persons/institutions who signed a non-disclosure agreement with Aljazira Capital. Funds managed by Aljazira Capital and its subsidiaries for third parties may own the securities that are the subject of this document. Aljazira Capital or its subsidiaries may own securities in one or more of the aforementioned companies, and/or indirectly through funds managed by third parties. The Investment Banking division of Aljazira Capital maybe in the process of soliciting or executing fee earning mandates for companies that is either the subject of this document or is mentioned in this document. One or more of Aljazira Capital board members or executive managers could be also a board member or member of the executive management at the company or companies mentioned in this report, or their associated companies. No part of this report may be reproduced whether inside or outside the Kingdom of Saudi Arabia without the written permission of Aljazira Capital. Persons who receive this report should make themselves aware, of and adhere to, any such restrictions. By accepting this report, the recipient agrees to be bound by the foregoing limitations.
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