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PricePricing / Valuation as on May 27, 2009Mkt capSh. outstandingKey statisticsSR39.3SR5.3bn ($1,416.7mn)135.0mn52 week range H/L (SR) 76.8/28.1Avg daily turnover (mn) SR US$3m 9.21 2.4612m 15.50 4.14Raw Beta 6m 3yr0.70 0.89ReutersBloomberg3020.SEYACCO ABPrice perform (%) 1M 3M 12MAbsolute (%) (5) 20 (48)Market (%) 6 32 (39)Sector (%) (6) 19 (44)Website www.yamamacement com saValuation multiples2006 2007 2008P/E (x) 17.6 17.4 7.5P/B (x) 5.5 5.4 1.6P/Sales (x) 11.2 10.7 4.1Div yield (%) 2.5 3.2 5.9Weightage (%)TASI (free float weight) 1.04MSCI Saudi (domestic – mid cap) 11.23Free float (%)Free float 87.65Relative share price perf.11,0009,0007,0005,0003,000M ay-08 Aug-08 Nov-08 Feb-09 M ay-09TASITop 5 shareholders (%)80604020Yamamah Cement (RHS)Prince Sultan Mohammed Saud 9.7AlKabeer Al SaudGeneral Organization for Social 7.1Insurance (GOSI)Public Pension Authority (PPA) 5.0-CEMENTYamama Saudi Cem.Alsoknown asYSCCYamama Saudi Cement Company (YSCC) was founded in Riyadh in 1961 by LatePrince Mohammad Bin Saud Al-Kabir. YSCC commenced production with a meagercapacity of 0.9mn tonnes pa. However, in 2008, the company’s cement sales stood atover 4.0mn tonnes in the domestic market and 0.3mn tonnes in the export market.Company financials2005 2006 2007 2008YoY(%)CAGR(%)(05-08)Net Revenues SRmn 791 950 1,186 1,123 (5.3) 12.4EBITDA SRmn 528 646 826 809 (2.1) 15.3Net Income SRmn 501 601 731 611 (16.5) 6.8Assets SRmn 2,706 3,128 3,604 3,589 (0.4) 9.9Equity SRmn 1,576 1,939 2,365 2,841 20.1 21.7Total Debt SRmn 710 761 581 563 (3.2) (7.5)Cash & Equiv SRmn 565 260 441 643 45.9 4.4EBITDA Mgn % 66.8 68.0 69.7 72.0 - -Net Mgn % 63.3 63.3 61.7 54.4 - -ROE % 34.3 34.2 34.0 23.5 - -ROA % 13.6 20.6 21.7 17.0 - -Div Payout % 53.9 44.9 55.4 44.2 - -EPS SR 55.7 4.5 5.4 4.5 (16.5) -BVPS SR 175.2 16.4 17.5 21.0 20.1 -Source: Company, NCBC ResearchSegment-wise business analysisProduct segment 2007 Geographic 2007%Rev % Net Inc Breakup %Rev % Net IncCement Production 100.0 100.0 Saudi Arabia 100.0 100.0Source: Company, NCBC Research• Business brief: YSCC’s cement production accounted for 13.3% of the total cementproduction in Saudi Arabia for 2008. This was a moderate decline from 15.4%reported in 2007. The company also holds stake in companies such as SudaniKuwaiti Holding Co (6.67%), Kafaa for Steel Company (6.00%), Industrialization andEnergy Services Co (5.62%), and Arabian Shield Cooperative Insurance Co (5.00%).• Financials: Company’s sales declined 5.3% y-o-y to SR1,122.9 mn. YSCC’s EBITDAmargin, which stood at 72.0% in 2008, has witnessed improvement as compared toFY05. However, the net margin has been declining over the past 3 years, and stoodat 54.4% in 2008.• Recent developments: In April 2009, YSCC announced a 36% y-o-y fall in Q109 netprofit to SR125.9mn mainly due to lower sales volume during the period as well as aperiodic maintenance on some of its main production lines. In August 2008, YamamaCement announced that it is likely to become a founding partner in Hail Cement Co.,a joint stock company under establishment. In late 2008, the company acquired 5%stake in Hail Cement Company for SR60 mn.Source: NCBC ResearchJUNE 2009YAMAMA SAUDI CEMENT139