Suez, a subsidiary of
Italcementi, said first-half profit was 412.4 million Egyptian pounds
($69.2 million), down from 653.8 million for the same period in 2010. “Local
consumption of regular portland cement declined by 4.9 percent in the
first-half of 2011 ... whereas Suez Cement’s sales declined by 14.3
percent,” said Suez, Egypt’s largest listed cement maker by market
value. Industry analysts said they expected a slump in the net
profit of most cement companies after mass protests that toppled
President Hosni Mubarak interrupted construction operations. The
political upheaval also followed corruption cases against the heads of
some of the country’s biggest listed real estate developers. “Our
expectations for Suez’s H1 was 401 million pounds due to the political
and economic uncertainty so the results are in-line,” said Rehab Taha, a
senior analyst at Prime Group. “Demand for cement was weaker and
there were thinner volumes of raw material because construction
activities were lower and several real estate companies were involved in
legal cases.” Taha said she expected Suez’s second-half net profit to be unchanged compared with its first-half of this year. “I
think we will also see that 400 million pound range in H2 for Suez
given business slowdowns during the summer season, Ramadan, and upcoming
elections,” Taha added. The fasting month of Ramadan, which begins
Aug. 1 in Egypt, is followed by parliamentary elections scheduled for
later this year.
