Displaying items by tag: Raysut Cement

Oman: The Financial Services Authority has reconstituted the board of directors of Raysut Cement. It has appointed Shabib Mohammed Al Darmaki as its chair with Naser Jumaa Al Zadjali, Badr Awad Al Shanfari, Ali Rashid Ali Al Shuhi and Abdulhameed Ahmed Al Balushi as members. The new board is intended to follow the role of the previous board by completing the “reorganisation and restructuring of the company and fine-tune its governance to ensure stability of its financial and operational positions to correct its path to ensure sustainable performance and protect the interest of all the shareholders and enhance the stability of the market.”

In December 2022 the Capital Market Authority (CMA) replaced the board of directors of Raysut Cement and appointed a temporary one following a financial audit. This followed the CMA publicly questioning the validity of the company’s third quarter results in 2022 when it detected ‘material misrepresentation.’

Oman: Tarek Talaat has moved from Egypt-based Misr Cement Group to Raysut Cement, where he takes over the role of CEO. He was previously managing director and CEO of Misr Cement Group. Before that, he held leadership positions across Europe, Egypt and the Middle East at Holcim, Arabian Cement Company and Ras Al Khaimah White Cement. Raysut Cement called Talaat the ‘standout’ choice for the CEO position, due to his vision, strategic mindset and proven turn-around experience. Tarek holds a bachelor’s degree in civil engineering from Cairo University and studied financial management at INSEAD University in France. He has a Master of Business Administration (MBA) degree from the Swiss Business School, Zurich, in Switzerland.

Raysut Cement said “With Mr Tarek at the helm, we are confident that Raysut Cement will continue to thrive and reach new heights. His leadership will be instrumental in guiding the company through the ever-evolving landscape of the cement industry.”

Reuters has reported that Talaat’s resignation as managing director of Misr Cement Group will take effect on 12 October 2023.

Oman: Raysut Cement reported a net loss of US$4.52m during the first half of 2023. This corresponds to a drop of 67% year-on-year from US$13.8m in the previous first half. The Oman Daily Observer newspaper has reported that the producer attributed the loss reduction to its implementation of operational efficiency and cost reduction measures, as well as growth in sales volumes, during the latest half.

Huaxin Cement completed its acquisition of a majority stake in Oman Cement this week. The China-based company estimated that the purchase price was around US$193m. Following the transaction with a subsidiary of the Oman Investment Authority, the country’s sovereign wealth fund, the cement producer now controls just under a 60% share in Oman Cement.

A key part of the deal includes Oman Cement’s integrated plant at Ruwi in the north of the country. The three-line unit has clinker and cement production capacities of 2.6Mt/yr and 3.6Mt/yr respectively. With the partial ownership share of 60% taken into account, this places the capacity purchase price at around US$124/t, a lower figure for capacity compared to other international acquisitions.

Oman Cement has a couple of new projects in the pipeline that have been mentioned on and off previously over the last year or so. These include the construction of a new 10,000t/day fourth production line, an upgrade to line 3 to 4000t/day from 3000t/day at present and plans for a new plant at the Special Economic Zone (SEZ) at Duqm. The company said it was looking for a contractor to carry out the upgrades at the Ruwi plant. However, Rashid bin Sultan al Hashmi, the chair of Oman Cement, said in the company’s annual results for 2022 that the Duqm project, operating under the name Al Sahawa Cement, had run into problems with the supply of gas for the proposed unit. Another recent development was the signing of a deal between Omani Environment Services Holding Company (Be’ah) and Oman Cement for the supply of refuse-derived fuel (RDF). As an aside, that last one may also have received a boost this week with the news that the local Environment Authority has suspended licenses for the export of used tyres from the country.

How these existing projects will fare under the new ownership remains to be seen, but Huaxin Cement has a track record for developing new cement production capacity outside of China. The cement producer describes itself as de-facto controlled by Switzerland-based Holcim although Holcim said in its annual report for 2022 that Huaxin Cement is a joint-venture. It currently operates plants in Cambodia, Kyrgyzstan, Malawi, Nepal, Tajikistan, Tanzania, Uzbekistan and Zambia and says that it has 10 additional projects in Africa, the Middle East and elsewhere in preparation for future business expansion. In 2022 it started operating a 3000t/day production line at Nepal Narayani and commenced the second stage of a project to build a 4000t/day clinker line at Maweni in Tanzania. Plus, as mentioned in our recent roundup of China-based producers, 13% of the group’s operating revenue derived from business outside of China in 2022 compared to 8% in 2021.

Other producers from outside of Oman have also been active locally in 2023. In late January 2023 India-based UltraTech Cement agreed a deal to buy a 70% stake in Duqm Cement Project International from Seven Seas for US$2.25m. The agreement covered a limestone mining lease that UltraTech Cement said was important for “raw material security.”

The other big development in the Oman cement market since we last covered the country in September 2021 was an intervention by the Capital Market Authority (CMA) on Raysut Cement. The chief financial officer resigned in November 2022 before the CMA questioned the company’s financial results for the second quarter of 2022. The CMA then replaced the board of Raysut Cement in December 2022 saying it had detected ‘material misrepresentation’ in the company’s third quarter results.

The last four months or so have marked a turning point for the local cement sector with a change in leadership for the two largest producers. Oman Cement reported strong growth in 2022 although it warned of “low priced cement being supplied by competitors.” Raysut Cement, unsurprisingly, recorded a loss in 2022. The construction market in the country is expected to grow as the economy leaves the coronavirus period behind, mounting energy prices boost national revenue and potentially some of this heads into infrastructure development. This puts the new management at both producers in a good position going forward.

Oman: Raysut Cement’s loss after tax rose to US$243m in 2022 from US$33.6m in 2021. Its expenses more than doubled to US$361m from US$168m. Its sales revenue dropped by 12% year-on-year to US$118m from US$134m.

The release of financial data for 2022 follows the intervention by the Capital Market Authority (CMA) in late 2022. In November 2022 the regulator publicly called on the cement producer to urgently address 'material misrepresentations' in its financial results for the second quarter of 2022. It then replaced the company’s board of directors and appointed a temporary one in December 2022 following an audit. This is the second time the CMA’s history that it has taken such action, according to local press.

Oman: The Capital Market Authority (CMA) has replaced the board of directors of Raysut Cement and appointed a temporary one following a financial audit. The CMA said the new board would, “deal with the reasons that led the company to conditions that prompted such action.” It will restructure the company to ensure the stability of its financial position. In late November 2022 the CMA questioned the validity of the company’s third quarter results in 2022 when it detected ‘material misrepresentation.’ Additionally, the cement producer’s chief executive officer and chief financial officer resigned in August 2022 and November 2022 respectively.

The new board is headed by Hamdan Ahmed Al Shaqsi. It also includes Majid Sultan Al Tauqi, Dr. Ali Amer Al Ghaithi, Ahmed Saud Al Zakwani and Mubeen Jalil Yasin Khan. The new board members will each hold their posts for three years.

Oman: The Capital Market Authority (CMA) has called on Raysut Cement to urgently address 'material misrepresentations' in its financial results for the second quarter of 2022. The Oman Daily Observer newspaper has reported that the CMA has warned investors that the misrepresentations 'hugely' impacted the report's profit and loss accounts.

The regulator said "CMA emphasises that failure to exercise due diligence in providing timely and accurate financial statements to the investors in fair manner is a breach of the law, and renders the violating entities legally responsible. The CMA announces zero tolerance in this regard."

Oman: The board of directors of Raysut Cement approved the resignation of its chief financial officer Jitendar Singhvi.

Oman: Raysut Cement has appointed Khalid Ramis Mohammed Al Rawas as its chief executive officer. It follows the resignation of Ghose Jotirmoy Pratul Krishna in early August 2022. Al Rawas holds nearly 30 years of experience working in the banking sector. He joined Raysut Cement in 2019.

Oman: Ghose Jotirmoy Pratul Krishna has resigned as the chief executive officer of Raysut Cement. The company will announce the appointment of his successor from mid-August 2022. In a statement the cement producer said that recent news circulating on social media had nothing to do with it or its subsidiaries and that the situation referred to a time before the executive joined the company in late 2017. It added that its current CEO was currently in Oman. Ghose was previously the managing director of Binani Cement in India.