Saudi Ceramic buoyed by anti-dumping duties on tile imports: CEO

Majid Alissa, CEO of Saudi Ceramic Co.

Saudi Ceramic Co.’s performance was lifted by the anti-dumping duties charged on the Indian and Chinese tile imports, CEO Majid Alissa told Argaam in an exclusive.

“It’s currently difficult to exactly estimate the impact of this decision amid the current global economic conditions and COVID-19 pandemic,” Alissa said, affirming the high quality of the company’s products.

The anti-dumping duties helped protect the GCC tile producers from the harmful practices, which slashed factories’ production capacities amid the “illogical” price declines in the market.

Saudi Ceramic’s factories grab nearly 25% of the local ceramic and porcelain market, where demand is estimated at almost 250 million square meters. The company also holds a 40% market share of the sanitaryware market and 60% market share of the electric heaters market.

Commenting on the company’s 2020 financial results, Alissa noted that Saudi Ceramic’s operating and financial performance improved in 2020 compared to the year-earlier, despite the COVID-19 fallout on the company, especially in the second quarter of the year.

The company aimed to enhance its operating efficiency in 2020, he added, affirming that growth in the construction sector helped improve all segments’ performance.

“In 2020, the company reported a 24% year-on-year growth in sales and better profit margins, on increased sales volumes, which in turn reflected a recovery in the construction industry, and improved prices of most products,” Alissa explained.

“Saudi Ceramic also continued to undertake various projects to cut costs and enhance factories’ operating efficiency,” he added.

Financing costs dropped by 21% last year amid lower interest rates. The company also repaid a considerable amount of its debts in 2020, despite amortizations and additional provisions estimated at nearly SAR 26 million, when compared to 2019.

Moreover, Saudi Ceramic fulfilled its obligations towards creditors, including banks and government entities, repaying SAR 352 million worth of debt last year, of which 41% were repaid in the fourth quarter.

Outstanding debts totaled almost SAR 750 million by the end of 2020.

The Saudi government COVID-19 initiatives helped the company and the industrial sector largely mitigate the negative impact of the pandemic, Alissa affirmed, adding that Saudi Ceramic

did not have to suspend operations during the crisis. This, in turn, enabled the company to have sufficient stock of products and meet growing market demand.

“The company is always working to develop its products and boost higher local market share through extending its growth in the retail market. Saudi Ceramic opened ten showrooms last year, and is eyeing more branches this year. The company is looking forward to enhancing export growth by entering into new markets,” Alissa highlighted.

The ceramic producer’s 2020 net profit surged to SAR 77.7 million from SAR 7.2 million in 2019, Argaam reported.