LONDON: RAK Ceramics, the UAE-based tile-maker, wants to boost its Saudi business amid a tough market elsewhere in the Gulf.
The Kingdom emerged as a rare regional bright spot as it reported earnings on Wednesday that were defined by “challenging market conditions and increased competition in export markets,” it said in a statement.
“Saudi Arabia has been a strong market for us predominantly in tiles, where we witnessed a substantial growth in the fourth quarter which reflected positively on the year-on-year growth,” said RAK Ceramics CEO Abdallah Massaad.
“Looking ahead, our priorities for 2020 are to maintain our market share in the United Arab Emirates, Bangladesh and India; further grow our market in Saudi Arabia; and strengthen the overall performance of distribution entities in Europe.”
Building materials exporters have been hit by the triple whammy of a sharp slowdown in the regional housing market, a weaker oil price which has affected government project spending and a strong dollar to which some Gulf currencies are pegged — making their exports more expensive in key construction markets such as Europe.
However, a recent pickup in construction activity in Saudi Arabia, the largest economy in the Gulf, has been a confidence boost for the beleaguered building sector.
Overall sales slumped 5.6 percent to 2.57 billion dirhams ($684 million) on a year earlier however Saudi Arabia showed strong growth with revenues jumping more than 9 percent to 271.9 million dirhams.
The projects segment in the Kingdom was stable and tiles revenue grew by 6.9 percent to 248.7 million dirhams. Meanwhile sanitaryware revenues surged by 41.6 percent to 23.2 million dirhams.