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3060

Governance: A

YCC

Yanbu Cement Co.

14.78 SAR / Share

As of: Mar 26, 2026

22.3x P/E Ratio Trailing 12 Months

0.9x P/B Ratio Price to Book Value

8.5% Dividend Yield Annual Dividend / Share

2.33B SAR Market Cap Total Valuation

1.08 Beta Systematic Risk Index

9.6% Net Margin Net Profit / Revenue

The Story

A mature industrial cornerstone of the Western Region transitioning from domestic stability to high-volume clinker exports while facing structural margin pressure.

Source: Annual 2025 (2026-03-11)

Value Creation -3.3% Excess Return on Capital (Spread between ROIC/ROE and Cost of Capital)

Cash Flow Payback — Estimated years of operating cash flows required to cover Enterprise Value

Performance & Distributions

Dividend Yield Trailing annual dividends paid relative to share price

8.5%

Sustainable Growth Rate Rate at which company can grow internally using reinvested profits

-5.0%

Payout Ratio Percent of net profits distributed as dividends

188.5%

Net Margin Net profit margin generated from total operational revenue

9.6%

ROIC Return on Invested Capital

5.7%

Market Pricing Multiples

P/E Ratio Market value compared to corporate net earnings

22.3x

P/B Ratio Market capitalization compared to corporate book value

0.9x

EV / EBITDA Operating multiple reflecting core operational leverage

8.3x

EV / SALES Asset pricing multiple relative to total topline revenue

2.2x

Growth Story

YCC demonstrated a significant top-line expansion in the twelve months ended December 31, 2025, with revenue reaching 1.08 billion SAR, up from 876.7 million SAR in fiscal 2024. This growth was primarily fueled by a surge in clinker exports, which tripled from 108.1 million SAR to 352.6 million SAR. However, this volume-driven growth masks a lack of long-term internal capacity expansion; the company's five-year average reinvestment rate is -88.45%, indicating that capital is being returned to shareholders rather than being plowed back into the business. Consequently, the sustainable growth rate stands at -5.01%, suggesting that without a shift in capital allocation or a significant increase in asset efficiency, the current revenue trajectory may be difficult to maintain over a long-term horizon.

Profitability Dynamics

The company's profitability profile reflects a challenging environment where volume growth has come at the expense of efficiency. The operating margin compressed to 11.1% TTM, down from 19.7% in fiscal 2024, largely due to a sharp rise in transportation expenses associated with the export pivot and a 37% increase in the cost of revenue. With a five-year average ROIC of 5.66% against a WACC of 8.90%, YCC is currently operating with a negative value-creation gap of -3.24%. While the company remains a cash generator, with a net income of 104.5 million SAR TTM, the rising cost of production—including a 120 million SAR provision for spare parts—indicates that the business is struggling to outpace its cost of capital.

Risk & Capital Structure

Beta Systematic market risk indicator relative to the TASI index

1.08

Cost of Equity Minimum required rate of return demanded by shareholders

9.0%

WACC Weighted average cost of total debt and equity funding

9.0%

Debt-to-Equity Ratio Proportion of corporate funding financed by debt creditors

6.7%

Risk Factors

YCC faces a combination of operational and strategic headwinds. The expiration of the non-binding Memorandum of Understanding with Southern Province Cement Company in September 2025 without an agreement removes a potential catalyst for regional consolidation and synergy. Furthermore, the company has disclosed a looming 4% increase in production costs starting in 2026 due to fuel price adjustments by Saudi Aramco. While the balance sheet remains relatively conservative with total debt of 156.1 million SAR against a 2.33 billion SAR market capitalization, the high concentration of debt maturing within one year (94%) requires disciplined liquidity management. The company's beta of 1.08 reflects a risk profile slightly more volatile than the broader market, sensitive to both local construction cycles and global commodity pricing.

Governance Disclosures

Rating: A

We track 5 key governance and oversight matters for this company in our database.

Significance: 3/10 Entrenchment

Board Remuneration and Bonus Refund

Total Board of Directors remuneration for 2025 was SAR 4,737,507. This figure includes a refund of a bonus amounting to SAR 0.43 million from one of the Directors.

Significance: 2/10 Info Asymmetry

Related Party Transactions with Associate

The Group engaged in transactions with its associate, Knowledge Centre for Cement Training Limited. In 2025, the Group paid SAR 18,396 on behalf of the associate, compared to SAR 781,536 in the prior year.

Mitigating Factors: Transactions are disclosed as being conducted under mutually agreed terms and conditions.

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In-Depth Analysis