Logo of Qassim Cement Co.
Qassim Cement Co.’s Q4 2021 net profit of SAR 34 million fell below Riyad Capital and consensus estimates, mainly due to lower margins and higher costs, the brokerage said in an earnings review.
The average selling price fell sharply by 35% year-on-year (YoY) and 28% quarter-on-quarter (QoQ) to SAR 114 per ton.
“We believe the decline in prices was a result of higher competition in the central region, which we expect to continue in the short term,” the brokerage said.
Riyad Capital expects an improvement in sales volumes in the coming months, while the average selling price is expected to remain under pressure, which is likely to negatively impact H1 2022 results.
The brokerage firm lowered its target price (TP) on the stock to SAR 73, due to the market conditions, but maintained its “Neutral” rating.
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