Qatar Cement, Samba in $100m deal

02/08/2016 06:11 AST

Qatar National Cement Company (QNCC) has signed a financing deal with Saudi's Samba Financial Group (Samba) for $100m. The facility, which has a two-year grace period, will go towards financing the construction of the company's fifth cement plant and should be repaid in three and half years, the cement maker said in a statement to the Qatari bourse yesterday.

QNCC announced later that the funding was to partly finance plant its Plant 5. In 2014, the company signed the letter of intent with Fives FCB, France for the construction of the fifth production line with a capacity of 5,000 tonnes per day (tpd) of clinker. The estimated cost was QR950m. The fifth production line was expected to become operational within the next 27 months, with total clinker production capacity was to reach 17,000 tpd and the grinding capacity touching 20,000 tpd of cement.

The cement company's move to have a fifth production line comes in view of an expected increase in demand for products due to the mammoth infrastructure works being carried out in the run-up to Qatar hosting the 2022 Fifa World Cup. The new project was expected to run parallel to the existing plants 2, 3 and 4.

On Sunday, QNCC announced that it achieved a net profit of QR251.7m for the first six months ended June 30, 2016, compared to QR242.6m posted for the corresponding period in 2015.

The Earnings per Share (EPS) amounted to QR4.24 for the first half of 2016, from QR4.08 posted a year ago.

In June, QNCC announced its decision to close cement plant 1 with effect from the start of the month. Cement plant 1 started production in May 1969 and reached designed capacity of 300,000 MT clinker per year in 1976. Currently, the capacity is estimated at 200,000 MT clinker per year and 140,000 MT cement per year.

The Peninsula