RAK Ceramics PJSC recently announced its financial results for the year ended December 31, 2018. The company reported total revenues of AED 2.78 billion (approximately $756.7 million), a decline of 2.8% due to lower non-core revenue contribution, in line with the company’s strategy to divest non-core entities.

Reported net profit was AED 225.1 million (~ $61.3 million), down 28.7%; net profit in 2017 included a net extraordinary gain of AED 38.6 million (~ $10.5 million) from the sale of non-core entities RAK Warehouse and Electro RAK. RAK Ceramics reported “all-time high” total gross profit margins of 33.2% in 2018 as a result of operational efficiencies, the consolidation of Saudi Arabian entities, and higher gross profits in the UAE and tableware businesses. The tableware business reportedly continued to show strong growth; revenues reached AED 264 million (~ $71.9 million), an increase of 11% compared to 2017, supported by growth in the U.S., European and Asian markets.

RAK Ceramics also announced its intention to invest in a Saudi Arabia-based state-of-the-art production facility that reportedly uses the latest technology in ceramic manufacturing and, in the first phase, will initially add approximately 10 million sq m per year to RAK Ceramics’ tile total production capacity. The company is reportedly optimistic for growth in Saudi Arabia due to increasing construction and real estate activity, as well as the attractive cost advantages for manufacturing due to competitive energy costs.

In October 2018, RAK Ceramics began commercial production in its recently expanded Indian facility. The greenfield project for producing slabs began trials production in January 2019, with commercial production expected to commence in the first quarter of 2019.

“2018 was an important year for RAK Ceramics; our record gross profit margins and reported net profit of AED 225.1 million is a significant achievement in light of challenging market conditions and continued increases in energy, raw material, and freight costs,” said Abdallah Massaad, group CEO. “Looking ahead for 2019, there are a number of external macro factors which will continue to affect our business. However, we are focused on enhancing our brand and optimizing operations across the group, while continuing to protect our strong market share in the United Arab Emirates, India, Bangladesh and Saudi Arabia.

“We are pleased to announce our intention to invest in a state-of-the-art production facility in Saudi Arabia, which has historically been one of our most important markets in the region. We are also focused on improving the profitability of our Indian and European operations and the growth of our tableware business in the U.S., European, and Asian markets.”

For more information, visit https://corporate.rakceramics.com.