‎Arabian Cement CEO says prices likely to stabilize in Q1 2022, high inventory level

‎Arabian Cement CEO says prices likely to stabilize in Q1 2022, high inventory level

Arabian Cement Co.’s (ACC) selling prices are expected to stabilize in the first quarter of 2022 despite the slight decline in January sales year-on-year (YoY), CEO Badr Johar told Argaam in an exclusive.

He added that the average cement selling prices fell by nearly 14% YoY in 2021 in the Western Province, while other provinces witnessed further declines due to the fierce competition among cement producers.

Commenting on the fourth-quarter financial results, Johar said they were impacted by low average selling prices and high exports compared to a year earlier despite the 7.7% YoY increase in the local sales volume.

ACC's 2021 sales increased by 25% compared with a year earlier, the CEO noted, adding that the Western Province witnessed 7% growth in demand, while the sector in general saw a 1.7% rise.

The decline in average selling prices and the depreciation provision of some under-construction projects affected the cement producer’s profit.

ACC’s export sales amounted to nearly 1.5 million tons of clinker and 100,000 tons of cement in 2021. Meanwhile, the company’s inventories fell to 2.1 million tons of clinker during the same year.

“The company has strong levels of cement inventories at average sales of five to seven business days,” Johar said.

With regard to