Southern Cement Q2 earnings miss estimates, says Al Rajhi Cap

29/07/2018 Argaam

 

Southern Cement’s SAR 36 million profits achieved in the second quarter came lower than Al Rajhi Capital and consensus’ estimates of SAR 77 million and SAR 83 million, respectively.

 

The research firm attributed the miss of forecasts to lower-than-expected sale price at SAR 138 per ton, with a 27 percent decrease year-on-year.

 

“We forecast Southern cement’s sales volume and prices to pick up slightly due to the partial end of seasonality factors. Downside risks are related to lower than expected sales volume and selling prices. Upside risks are related to potential benefits from exports as well as benefiting from the government mega projects located in the western region," Al Rajhi Capital said.

 

Al Rajhi Capital maintained its Neutral recommendation on the Saudi-listed firm and lowered the price target from SAR 44 per share to SAR 38 per share.

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