Muscat - Despite the overall dip in sales volume and revenue, Al Jazeera Steel Products Co managed to report a 23 per cent growth in net profit for the first quarter ended March 31, 2013. The company's net profit rose to RO1.39mn from RO1.13mn in the same period last year, according to a company filing with the Muscat Securities Market (MSM) on Monday.
Al Jazeera Steel's sales volume declined six per cent to 75,526 metric tonnes (MT) in the first quarter of this year from 80,431MT in the corresponding period last year, while sales value dropped 15 per cent to RO23.24mn from 27.38mn.
"The decrease in sales quantity is mainly due to the continued sluggishness in most of the global industrialised zones and fierce competition and predatory dumping from foreign producers,Ó said Sulaiman Mohammed Shaheen al Rubaie, in his chairman's report.
"The demand for pipes and merchant-bar products in the GCC market was nearly the same. In spite of all the above factors, with efficient inventory management, improved sourcing of raw materials and improved working capital management, Al Jazeera was able to increase its profits by 23 per cent," said Rubaie.
The board of directors of Al Jazeera Steel has approved additional facilities for rebar production by making some changes to the existing merchant bar mill.
"These changes will result in additional production of 70,000 tonnes per annum of rebar. Rebar facilities are expected to be ready for commercial production by mid-2014. We expect the merchant bar mill to be operational for 24 hours from the first half of 2014," Rubaie said.
He said that most GCC governments have continued to announce significant spending on infrastructure and the company expects this to result in additional demand for its products.
"Nonetheless, a very cautious approach is being taken by the management to protect against market downturns. A vigilant procurement plan for our raw materials, at the right prices and at the right time, is being monitored on a regular basis," added Rubaie.
© Muscat Daily 2013
