RAK Ceramics proposes 10 fils dividend after Q2 profit rises 2.9%

Dubai: RAK Ceramics’ board has proposed an interim dividend of 10 fils per share for the first half of 2026 after the company reported a 2.9% increase in second-quarter net profit.

The proposed distribution amounts to Dh99.3 million and remains subject to shareholder approval.

Net profit after tax increased to Dh68.3 million in the three months ended June 30, compared with Dh66.4 million during the same period last year, supported by demand in the UAE, Saudi Arabia and Bangladesh.

Group revenue slipped 0.5% to Dh822.8 million from Dh826.8 million, while gross profit margin improved to 41% from 40.6%, helped by higher sales in the UAE and Bangladesh and a favourable product mix.

Revenue from the UAE market increased 22.7% year on year to Dh298.2 million, supported by real estate and construction activity.

The company said disruptions to imports during the period created opportunities to increase its market share in the UAE.

Saudi Arabian revenue grew 11.6% to Dh60.8 million following a shift from higher-volume ceramic products towards Gres Porcelain products.

RAK Ceramics is progressing with the construction of its greenfield tile project in Yanbu, which is expected to be completed by the second quarter of 2027.

Bangladesh revenue increased 20.7% to Dh59 million, supported by domestic demand despite the impact of the Eid holidays in May.

“Throughout this period, our priority was clear: increasing our market share across the region, while making every effort to support customers in other markets,” Massaad said.

“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.”

Revenue from the company’s Tiles segment increased 1.7% to Dh482.5 million, reflecting higher sales in the UAE, Saudi Arabia and Bangladesh.

Faucets revenue through the KLUDI business increased 2.5% to Dh125.4 million, driven by higher sales across most markets, although Asia and Africa were affected by regional conflicts.

Sanitaryware revenue fell 6.9% to Dh113.1 million because of lower sales in India, Europe and other export markets.

Tableware revenue declined 13.3% to Dh73.6 million after regional conflicts weakened hospitality and tourism demand across the UAE and other Gulf markets. Export demand remained firm, while the integration of Cookplay continued during the quarter.

Revenue from Europe fell 35.7% to Dh57.8 million, reflecting supply disruption from the UAE and increased export freight costs.

RAK Ceramics used existing inventory buffers to maintain service levels in the European market during the period.

India revenue declined 15.8% to Dh73.7 million, while the decrease in local currency terms was 6.4%. The performance was affected by a temporary production disruption caused by industry-wide gas shortages in Morbi, although production resumed by June.

Middle East revenue outside the company’s separately reported core markets declined 5.8% to Dh35.4 million amid lower regional demand.

Revenue for the first half of 2026 declined 1.2% to Dh1.58 billion, compared with Dh1.60 billion during the corresponding period last year.

Net profit after tax fell 7.6% to Dh106.5 million from Dh115.2 million, while profit before tax declined 8.3% to Dh138.7 million.

First-half EBITDA decreased 3.9% to Dh284.8 million, while the gross profit margin remained stable at 40.2%.

Second-quarter EBITDA declined 2% to Dh157.5 million, and profit before tax decreased 1.1% to Dh85.7 million.

Net debt stood at Dh1.52 billion at the end of June, down 2.6% year on year, while the net debt-to-EBITDA ratio improved to 2.48 times from 2.53 times in March.

RAK Ceramics is also upgrading its UAE sanitaryware facility with energy-efficient technology, an expanded product range and measures aimed at reducing carbon emissions.