MUSCAT, MAY 9 -
Raysut Cement Company, the Sultanate’s biggest cement manufacturer, says it is exploring prospects for the expansion of its facilities in Suhar and Duqm ports, as well as green-field investment opportunities in East Africa.
This comes on top of the majority government-owned company’s newly unveiled plans to establish a major cement plant in the East European state of Georgia — a final investment decision for which is anticipated next month.
“The establishment of a cement plant in Georgia is being explored, while further capacity expansions in (locations) like the ports of Suhar and Duqm together with East Africa are being looked into,” said Ahmed bin Yousuf bin Alawi al Ibrahim, Chairman of the Board of Directors, in the Directors’ Report for the quarter ended March 31, 2018.
The announcement underscores the Salalah-headquartered group’s strategy to grow its market share regionally and internationally and bolster its bottom-line in the face of fierce competition at home as well as in the UAE where it owns Pioneer Cement, a key player in that market.
Last month, the company’s CEO, Joey Ghose, announced that the Board had approved initial research to be carried out with the aim of establishing of a 1 million tons per annum (MTPA) integrated cement plant in Georgia.
The proposed venture, said Ghose at the time, is in line with the Group’s 5-year strategy to evolve into a 20 MTPA capacity giant by the year 2022. Limestone for the project is proposed to be sourced from a quarry owned by Pioneer Cement Industries Georgia Limited, a second-tier subsidiary of Raysut Cement Group. The capacity of the mine, located some 60km from the capital Tbilisi, is estimated at 30 million tons of limestone, he noted.
Raysut Cement together with Oman Cement are also jointly exploring the potential for setting up a major green-field cement plant in the Special Economic Zone at Duqm. Al Wusta Cement Company, a JV set up by the two firms, has been allotted a 500,000 sq metre plot for the project under a usufruct agreement signed with the SEZ Authority. “The project will be progressed subject to the outcome of the final feasibility study,” said the Chairman in the Directors’ Report.
The Group’s burgeoning network currently includes five storage and packing terminals located across Oman and the wider region. In neighbouring Yemen, the Group owns a 49 per cent stake in Mukulla Raysut Trading and Investment Company, a local distributor of Raysut Cement’s cement products.
For the quarter ended March 31, 2018, the Group reported a 85 per cent slump in profit after tax at RO 0.450 million, down from RO 3.094 million for the corresponding quarter of last year. Group revenue climbed 7.88 per cent to RO 20.962 million this quarter, against RO 19.426 million for the same period of last year. However, the parent company, Raysut Cement, posted a 45.7 per cent jump in net profit at RO 3.838 million, up from RO 2.635 million last year. “As a result of severe price competition from UAE suppliers, and volatility in the export market, the Parent Company could achieve sales revenue of RO 15.740 million during the period, against RO 14.535 million during the same period of last year, an increase by 8.25 per cent,” the Chairman stated.
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