Northern Cement Co. Reports Significant Profit Growth Amid Cost Reductions and Management Challenges

Northern Cement Co., a small-cap player in the building products industry, has recently undergone an evaluation adjustment that reflects a shift in its technical score. This revision comes in light of various underlying trends and financial metrics that have been observed over recent periods.
The company has reported a notable increase in net profit for the half-year ending June 2025, reaching JOD 1.42 million, which marks a significant growth rate of 240.4%. Additionally, there has been a substantial reduction in raw material costs, which have decreased by 78.86% year-over-year. However, the company continues to face challenges with management efficiency, as indicated by a low Return on Capital Employed (ROCE) of 7.81%.

Long-term growth metrics show that net sales have only grown at an annual rate of 1.22%, while operating profit has seen a decline of 10.78% over the past five years. The stock is currently trading at a premium compared to its peers, with a Price to Book Value of 1.63, and has generated a return of 1.49% over the past year, which is below the market average of 22.74%.

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