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RELATED ARTICLES: Saudi Ceramics completes fourth factory facility | Saudi Ceramics sees 11% rise in 2010 profits | 25% of global sales from UK, says RAK Ceramics
Saudi Ceramic Company is to build a second factory to produce bathroom fixtures with a capacity of 36,000 tonnes as its expansion plans continue.
The ceramic products and water heater company said the first phase of the facility, to be built on the company’s own land in Riyadh, will produce 18,000 tonnes annually. Construction of the first phase will begin at the start of 2012, with production forecast to begin in the first half of 2013.
The listed company will invest $32m (SAR120m) in the first phase out of the company’s own cash flow from the Saudi Industrial Development Fund, a state-run investment fund that lends money to developing industrial facilities and businesses throughout Saudi Arabia, and commercial banks. The new factory is estimated to contribute SAR 75m to revenues when at full capacity.
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Saudi Ceramic produces ceramic tiles, porcelain tiles, sanitary ware and related products for commercial and residential fit-out projects, and also has a business line in producing water heaters.
It produces more than 42 million square meters of ceramic and porcelain tiles and more than 3.6 million pieces of decorative tiles from its factories in the Second Industrial City South East of Riyadh, covering an area of 100ha.
Net profits for the first half of 2011 were reported as SAR 125.3m, an increase of 8% against the same period last year.
It is the latest new facility to be launched by the company this year as it aims to capitalise on the high levels of construction activity and forthcoming plans in the kingdom, particularly from the 250,000 houses to be built up to 2015.
Last month the company completed its final phase in the construction of a fourth tile factory, which will produce 9,000,000 square metres of ceramic and porcelain. The company expects the facility to add an extra 10 million square metres to capacity and SAR 150m to revenue when fully operational.
In January, the company completed the construction and installation for a new factory that produces ceramics tubes and an annual capacity of clay pipes reaching 60,000. The new facility has been jointly funded 50-by Saudi Ceramic Company and a subsidiary,
Ceramic Pipe Company.
“The ceramics market in the kingdom is still growing," Moath Al Shaikh, an analyst at Al Rahji Capital who has an ‘overweight’ position on the company, told local press in July.
"This has attracted GCC ceramic producers such as the UAE's Ras Al Khaimah Ceramics to enter the market. This should intensify the competition in the Saudi market; however, we believe Saudi Ceramics is well positioned to capture more market share and continue growing."
Abdulkarim Alnafie, CEO, said last year to CW that the Saudi Arabia, was "not touched" by the recession felt i other parts of the world.
Shares rose 0.57% to SAR 131.25 yesterday.
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