Strong construction and real estate activity in the UAE helped RAK Ceramics deliver a resilient second-quarter performance, with higher profitability despite regional geopolitical tensions, supply chain disruptions and elevated logistics costs.
The Abu Dhabi-listed manufacturer reported net profit after tax of DH68.3 million for the three months ended June 30, up 2.9 per cent from Dh66.4 million a year earlier. Revenue slipped marginally by 0.5 per cent year-on-year to Dh822.8 million, while gross profit margin improved to 41 per cent from 40.6 per cent. EBITDA stood at DH157.5 million, compared with Dh160.8 million in the corresponding period last year.
The company said demand in the UAE, Saudi Arabia and Bangladesh helped offset pressures from disruptions across regional supply chains and higher freight costs. It also maintained product availability and service levels through its regional manufacturing and distribution network.
The UAE emerged as the group’s strongest market during the quarter, with revenue climbing 22.7 per cent year-on-year to Dh298.2 million, supported by robust activity in the property and construction sectors. The company said import disruptions linked to regional tensions had also created opportunities to gain market share.
Saudi Arabia also recorded double-digit growth, with revenue rising 11.6 per cent to Dh60.8 million as the company shifted its focus towards higher-value porcelain products. Bangladesh revenue increased 20.7 per cent to Dh59 million on the back of strong domestic demand.
However, conditions remained challenging in other markets. Revenue in Europe fell 35.7 per cent due to supply disruptions and higher export freight costs, while revenue in India declined 15.8 per cent following temporary production disruptions caused by gas shortages in Morbi, a major ceramics manufacturing hub.
“Our priority was clear: increasing our market share across the region, while making every effort to support customers in other markets,” said Abdallah Massaad, Group Chief Executive Officer of RAK Ceramics. “Backed by our strong brand, product quality, and regional manufacturing footprint, we responded quickly to changing market conditions, leveraging locally sourced raw materials, alternative logistics routes, and other practical solutions to maintain reliable supply and service across our network.”
Looking ahead, the company said it remains focused on value-led growth and expanding its market presence in core markets while pursuing operational improvements across its European, Indian and Bangladeshi businesses. “We remain confident in our ability to deliver sustainable long-term value for our stakeholders,” Massaad said.
Source: Khaleej Times