MUSCAT -- Raysut Cement's shipping subsidiary, Raysea Navigation, has commenced commercial operations, Mohammed bin Alawi Ali Muqaibal, Chairman of the Board of Directors of the parent group, said in the quarterly report of the company's financial performance for the quarter ending March 31, 2011.
Raysea Navigation, which provides shipping services to Raysut Cement, earned a profit of RO 81,421 during the first quarter of this year.
Meanwhile, Raysut Cement posted an eight per cent decline in sales revenues, which dropped to RO 14.9 million during the three-month period ending March 31, 2011 against earnings of RO 16.3 million during the corresponding period last year. Profit before tax stood at RO 4.45 million for Q1 2011, as against RO 6.81 million earned during the corresponding period of last year, a decline of 35 per cent.
Total revenues earned by the Group during Q1 2011 amounted to RO 20.24 million, while profit before tax stood at RO 4.98 million.
"The decline in profit is attributable mainly to severe competitions faced both in domestic and the export markets impacting both volume and the price, which started from the later quarters of the previous year," the Chairman stated.
Raysut Cement's newly acquired subsidiary, Pioneer Cement, earned a profit of RO 452,012 for Q1 2011 despite severe competition in the domestic market. Production of clinker and cement at Pioneer stood at 329,220 metric tons (MT) and 262,277 MT respectively, against 331,475 MT and 356,932 MT respectively in the corresponding period of the previous year.
"The fall in demand and the resultant competition in the UAE are standing in the way of larger production," the report stated.
Of these volumes, Pioneer Cement sold 114,210 MT in the domestic market and 148,279 MT in Oman during Q1 2011, compared with 313,423 MT and 44,490 MT respectively in the corresponding period of last year.
The Group's combined output during Q1 2011 amounted to 806,907 MT of cement and 894,799 MT of clinker.
Clinker production at the Salalah plant increased 3 per cent to 565,579 MT of clinker during the quarter ending March 31, 2011, against 547,613 MT produced in the same period last year. Cement output at the Salalah plant also jumped 16 per cent to 544,630 MT this year, against 468,360 MT produced during the corresponding period last year.
The Group as a whole sold 851,844 MT of cement during the quarter ending March 31, 2011. Raysut Cement's contribution amounted to 569,355 MT of cement and 32,982 MT of clinker during this period, against 509,405 MT of cement and 91,158 MT of clinker in the corresponding period last year.
Cement exports jumped 39 per cent 179,573 MT this year from 129,646 MT during the corresponding quarter last year. Sales in the domestic market climbed 3 per cent to 389,782 MT against this year, from 379,759 MT in the corresponding period of 2010.
Commenting on the short and medium outlook for company, Mohammed bin Alawi Ali Muqaibal stated: "The plan outlay for 2011 will provide a significant boost to Oman's economy in all the sectors including the infrastructure sector. Some of the significant projects cleared by the government will have its impact on the increase in demand in the infrastructure sector, and particularly in the construction segment."
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