Saudi Cement Co. — Capital/Financing Update 2014

Sep 22, 2014

Addendum announcement from Saudi Cement Company related to Rehabilitation and Reoperation of Kilns 4 & 5 in Hofuf Factory

3030 · 22/09/2014 08:32:40 · Announcement #35657 · View on Saudi Exchange

Addendum announcement from Saudi Cement Company related to Rehabilitation and Reoperation of Kilns 4 & 5 in Hofuf Factory

This is further to the Company announcements on Tadawul website dated 23-4-2013(13-6-1434) and 07-5-2013 (27-6-1434) and 21-11-2013 (18-01-1435) about rehabilitation and re-operation of Kilns 4 & 5 in Hofuf factory with a total designed capacity of 3000 (Three Thousand) tons of clinker/day during Q3: 2014. The Company hereby announces the completion of rehabilitation works for kilns 4 & 5 in Hofuf factory. The Company also announces its decision not to operate these kilns currently due to high clinker inventory levels at the end of August 2014 of about 19.8 million tons for the Saudi cement companies, and in light of absence of any real growth in demand kingdom-wise during the period up to August 2014 compared with the corresponding period of last year, and in addition to a drop in Company sales quantity during the same period by around 14%. The feasibility of operating these two kilns shall be reconsidered whenever market conditions warrant that. The financial impact of this decision shall be annual depreciation charges of around SAR 7.6 million commencing Q4: 2014 in order to extinguish the capital costs of the project amounting to about SAR 76 million.

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