Tabuk Cement Company (TCC) [3090.SE] signed an agreement with Golden Oil company to export 500k tonnes of clinker to Yemen. The agreement will be valid until the end of 2019 and the financial impact will be reflected starting 2Q19. The company had previously signed  two MOUs to export cement and clinker to Yemen with combined capacities of 606k tonnes of clinker and 150k tonnes of cement. Overall, a positive news for the company, especially that the aggregate clinker export quantity to Yemen reached c41% of the company’s total clinker capacity and c57% of its clinker inventory. Hence, we expect the export deal will help reduce the elevated clinker inventory, which currently stands at 25 months of clinker requirements and should create a cash buffer until the mega projects execution phase materialises. .
 
Tabuk Cement: SAR12.20 as of 21 Mar. 2019, Rating: Neutral, TP: SAR12.50/share, MCap: USD293mn, TACCO AB/3090.SE