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3092

Governance: B

RIYADH CEMENT

Riyadh Cement Co.

23.74 SAR / Share

As of: Mar 26, 2026

13.7x P/E Ratio Trailing 12 Months

1.7x P/B Ratio Price to Book Value

9.5% Dividend Yield Annual Dividend / Share

2.85B SAR Market Cap Total Valuation

1.02 Beta Systematic Risk Index

26.4% Net Margin Net Profit / Revenue

The Story

A high-margin, low-leverage cement producer focused on returning capital to shareholders while maintaining a specialized position in the Saudi construction market.

Source: Annual 2025 (2026-03-15)

Value Creation +4.0% 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

9.5%

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

-3.8%

Payout Ratio Percent of net profits distributed as dividends

129.9%

Net Margin Net profit margin generated from total operational revenue

26.4%

ROIC Return on Invested Capital

12.8%

Market Pricing Multiples

P/E Ratio Market value compared to corporate net earnings

13.7x

P/B Ratio Market capitalization compared to corporate book value

1.7x

EV / EBITDA Operating multiple reflecting core operational leverage

8.5x

EV / SALES Asset pricing multiple relative to total topline revenue

3.5x

Growth Story

The company's growth profile reflects a mature industrial entity in a consolidation phase. Revenue has remained stable but flat, moving from 789.4 million SAR in fiscal 2024 to 787.6 million SAR for the TTM period. Riyadh Cement's sustainable growth rate is currently calculated at -3.8%, a direct result of a negative five-year average reinvestment rate of -29.9%. This indicates that the business is distributing more than its earned income to shareholders rather than retaining it for expansion. Despite this, the company is not stagnant; it maintains capital commitments of 185.3 million SAR for constructing property, plant, and equipment, suggesting a focus on maintaining and modernizing its existing production capacity rather than aggressive volume growth.

Profitability Dynamics

Riyadh Cement is a consistent value creator, evidenced by a five-year average ROIC of 12.8% which maintains a healthy 4.03% spread over its WACC of 8.8%. Although net income saw a contraction from 310.4 million SAR in fiscal 2024 to 207.8 million SAR in the TTM period, the company maintains robust profitability with an operating margin of 27.5%. The business model is highly cash-generative, allowing for significant shareholder returns; in fiscal 2025, the company declared 270 million SAR in dividends, supported by its 61.97 million SAR cash balance and the liquidation of short-term Murabaha deposits. The profitability of its white cement line, contributing 162.2 million SAR to revenue, provides a specialized buffer against the more commoditized grey cement market.

Risk & Capital Structure

Beta Systematic market risk indicator relative to the TASI index

1.02

Cost of Equity Minimum required rate of return demanded by shareholders

8.8%

WACC Weighted average cost of total debt and equity funding

8.9%

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

0.1%

Risk Factors

From a financial perspective, Riyadh Cement operates with a 'fortress' balance sheet, carrying minimal total debt of only 1.66 million SAR against a market capitalization of 2.85 billion SAR. This results in negligible leverage risk. However, operational risks are present; the provision for slow-moving inventories increased significantly from 20.3 million SAR to 31.5 million SAR in fiscal 2025, indicating potential inefficiencies in stock turnover. Furthermore, the company faces high customer concentration, with two major clients accounting for approximately 391.6 million SAR, or nearly 50% of total revenue. With a beta of 1.02, the company's market risk is almost perfectly aligned with the broader Saudi equity market.

Governance Disclosures

Rating: B

We track 7 key governance and oversight matters for this company in our database.

Significance: 4/10 Entrenchment

Concentrated Shareholder Control

Rashid Development Company Limited (Rashidco) holds a 23.21% effective ownership interest in the company. Rashidco is 100% owned by Al Awael Investment Holding Company, the ultimate parent.

Significance: 5/10 Info Asymmetry

Outstanding Balances Due from Related Entities

As of 31 December 2025, the company held SAR 46,115,057 in receivables due from related parties. The largest balances are owed by Alrashed Cement Company (SAR 36,473,983) and Towa Development Company (SAR 9,638,958).

Mitigating Factors: The transactions are governed by mutually agreed terms and conditions.

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In-Depth Analysis