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Saudi Arabian Mining's Q2 profit slumps 51% YOY

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Saudi Arabian Mining's Q2 profit slumps 51% YOY

Saudi ArabianMining Co. or Ma'aden, said July 18 that its second-quarter netprofit slumped by 51% year-on-year to 132.5 million Saudi riyals, from the270.0 million riyalsrecorded in the same period in 2015.

Revenues for the quarter declined 15% year over year due tolower commodity prices for ammonium phosphate fertilizer, ammonia and aluminumproducts.

The lower prices were partially offset by higher salesvolumes of aluminum and gold.

The company, however, cut its cost of sales by 11% throughlower raw material costs and through an ongoing cost-cutting initiative. Theinitiative led to a 65% reduction in exploration and technical services costsas well as a 27% drop in general and administrative expenses.

During the second quarter, Ma'aden delivered higherproduction volumes in aluminum, phosphate and gold, compared to the firstquarter.

The company produced and sold 669,000 tonnes and 705,000tonnes of ammonium phosphate fertilizer, respectively. The figures were 2% and18% improvement compared to the previous quarter.

The company also produced 300,000 tonnes of ammonia and sold154,000 tonnes, representing a decline of 25% in sales, due to increase inconsumption at ammonium phosphate fertilizer plant as compared to the previousquarter.

Gold production and sales in the quarter meanwhile,increased by 36% and 58% on a quarterly basis to 60,000 ounces and 63,000ounces respectively, mainly due to the Ad Duwayhi gold mine coming to in April.

For the half, net profit fell 43.2% to 301.4 million riyals,from 530.9 million riyals in the year-ago half.

As of July 18, US$1was equivalent to 3.75 Saudi riyals.