Stock picking keeps Umm Al-Qaiwain Cement in black

Gross profits and sales were down agaionst last year.

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Umm Al-Qaiwain Cement Industries posted a profit of AED11 million for the first nine months of 2010 on the back of returns from its share portfolio as its cement business continued to see losses.

The Emirati supplier saw sales decline by almost two-thirds against the same period last year - AED31 million against AED87 million in 2009 – with gross profits slashed to AED1.51 million from AED8.86 million.

Sharp falls in both demand and market prices and ongoing strife affecting the real estate and building materials market were the chief causes for the reduced performance, the company said, in a statement to the stock market signed off by managing director Salem Abdullah Salem.

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But the company nevertheless posted a net profit – reversing a net loss of AED22.81 million the previous year - through an AED14.93 million profit from its stock picking, a figure boosted by the re-evaluation of its investments, the rise in GCC stock markets, and the receipt of 2009 dividends. Gross profits for its shares were AED13.83 million compared to a loss of AED22.06 million last year.

The company’s own shares have risen 25% since the beginning of July, from 61 fils on the 4th July to 76 fils at the end of last Thursday.

Meanwhile, National Cement Company, the Dubai-listed supplier, has said its board meeting is to take place this Wednesday. The company posted a six-month profit of AED54 million, down 60% from the same period last year as a further sign of the struggle for market share for UAE manufacturers, which analysts say are at a disadvantage in the GCC as they are not subsidised by the government.