Saudi miner Ma’aden lifts off as profits rocket

A 70 percent year-on-year increase in gold production helped boost Maaden's profit by 120 percent in the first quarter. Getty
Updated 03 May 2018

Saudi miner Ma’aden lifts off as profits rocket

  • Profits rise on increased gold production, revenues rise 32 percent
  • Ma’aden mines gold, copper, aluminum and phosphates in Saudi Arabia

LONDON: Saudi mining company Ma’aden cheerked the market on Thursday with first quarter figures significantly ahead of analyst expectations, sending the Tadawul-listed stock 2 percent higher.

Gold was the standout feature as production rocketed to 118,000 ounces, up 70 percent year-on-year — a quarterly record.

It has been a good time to lift production of the yellow metal, seen as a hedge against global geopolitical uncertainty.

Group net profit surged over 120 percent in the first three months of 2018 against the same period in 2017, and sales were up 32 percent.

“By continuing to generate greater production from our assets whilst maintaining pressure on costs, we were able to capitalize on the generally positive commodity price environment,” said CEO Khalid Al-Mudaifer.

Ma’aden, which mines gold, copper, aluminum and phosphates — all at sites in Saudi Arabia — is ramping up production across many of its operations. Investors have piled into the shares, which trade on 25 times forward earnings making them highly-rated, but relatively expensive.

The company’s portfolio includes a joint venture with Barrick Gold of Canada.

In an interview with Arab News, Youssef Husseini, mining analyst at broker EFG Hermes in Cairo, said: “These results are exceptional with the cost profile impressive after a cost-cutting program — the margin came in 400 basis points up from where we thought.”

Al-Mudaifer pointed to a 36 percent increase in earnings before interest, tax, depreciation and amortization (Ebitda), a key market measure.

Ma’aden’s new phosphate operation at Wa’ad Al-Shamal was said to be progressing well as was the next phase of growth at its largest ever gold mine, the “Mansourah Massarah project”. An investment decision on further expansion was expected in the second quarter.

Commodity price volatility was forecast to be a feature of 2018 “but as the first quarter results show, we are well placed to deliver strong profitability built on the basis of strong underlying trends in our core commodities,” said Al-Mudaifer.

The only potential fly in the ointment, said Husseini, was the possibility of higher energy costs if Saudi Electricity upped its charges before the year is out. “We shall have to wait and see,” he said.

Al-Mudaifer said the first quarter saw a drop in the price of aluminum but the price trend remained favorable compared to 2016 and 2017 and “we continue to believe in the long-term fundamentals for this metal.”

He added: “Phosphate prices remained robust as did gold and copper although the latter dropped slightly in the quarter after a year of solid gains in 2017.”

Cash generated from operations was SR543 million ($144.7 million); a decrease of 28 percent compared to the first quarter of 2017, primarily due to increased working capital requirements, said the company.

Ma’aden’s liquidity position remained strong with cash and equivalents topping SR6 billion.


Dubai launches economic program for post COVID-19 recovery 

Updated 05 August 2020

Dubai launches economic program for post COVID-19 recovery 

  • “The Great Economic Reset Programme” is part of a “COVID Exit initiative” to help the recovery and reshaping of the economy
  • The economic program will feature analyses of current and future policies

DUBAI: Dubai launched an economic program as part of its efforts to reshape the emirate’s economy for a “sustainable” and “resilient” future post the coronavirus pandemic, the government said. 
The Dubai government partnered with the Mohammed bin Rashid School of Government (MBRSG) to launch “The Great Economic Reset Programme” as part of a “COVID Exit initiative” to help the recovery and reshaping of the economy, state news agency WAM reported on Tuesday. 
The economic program will feature analyses of current and future policies, research and extensive stakeholder consultation to set the direction and tone of future economic policies, regulations and initiatives.
The government plans to use local and international experts for economies and societies to create growth strategies for the Dubai economy.
The MBRSG held a “Virtual Policy Council,” with global experts and thought leaders to discuss the impacts of COVID-19 on the economy and potential policy responses and initiatives. 
Chief economists, senior practitioners and researchers from leading global institutions including the World Bank, joined experts from Dubai Economy and the MBRSG at the first roundtable.
“I believe the triple helix collaboration between public, private and academia stakeholders have always produced the best solutions in the past. In the highly uncertain environment now, extensive collaboration and cooperation between all stakeholders are vital to our future prosperity. The Virtual Policy Council will propose the best approaches Dubai and the UAE can adopt to address the risks and opportunities in the next normal economy,” said Mohammed Shael Al-Saadi, CEO of the Corporate Strategic Affairs sector in Dubai Economy.
“This Virtual Policy Council is a key component of the whole process where global experts and thinkers share their views on the future economy. In this new era, the role of governments in enabling the new economic actors is becoming increasingly central, and Dubai is well-positioned to lead the way with innovative models of growth post COVID19,” said Professor Raed Awamleh, Dean of MBRSG.
The roundtable also discussed the impact of the pandemic on international trade, foreign investment and tourism, as well as the rise of digital globalization.