Sonasid Reports Mixed First-Half 2024 Results: Revenue Down, Profit Up

Sonasid, a leading steel producer in Morocco, has reported mixed results for the first half of 2024. While the company's revenue declined by 4% compared to the same period in 2023, its net profit saw a significant increase of 13%.

The decline in revenue was attributed to a downward trend in international steel prices, which impacted Sonasid's social turnover, which stood at MAD 2,386 million at the end of June 2024. The company's operating result also contracted by MAD 22 million compared to the same period in 2023, reaching MAD 52 million. This decline was largely due to the erosion of the steel scrap margin observed globally. However, Sonasid managed to mitigate these challenges through strategic initiatives:

• Increased sales volumes by 5%
• Enhanced industrial competitiveness through investments aimed at reducing manufacturing costs
• Introduction of new, high-value-added products, such as steel fiber

Despite these measures, the company's social net profit fell by 11% compared to the first half of 2023, settling at MAD 42 million. However, the impact of this decline was limited thanks to a strong financial performance, which saw a 13% increase, driven by improved foreign exchange gains and losses and contributions from dividends from subsidiary Longometal Armatures.

Consolidated Results Show Positive Trends

Sonasid's consolidated revenue at the end of June 2024 reached MAD 2,437 million, marking a 4% decrease compared to the same period in 2023. However, the company's consolidated net profit for the group reached MAD 21 million, reflecting a 13% rise compared to the previous year. This increase was driven by the positive impact of lower IFRS depreciation and contributions from the financial result.

A Solid Financial Foundation

Despite the mixed financial performance, Sonasid continues to maintain a solid and resilient financial structure, with an excess cash flow, including securities and investment securities, of MAD 532 million at the end of June 2024.

Looking Ahead: Growth Potential in Construction and Sustainability

Sonasid is optimistic about the second half of 2024, with growth in the Moroccan construction sector expected to benefit the company. Sonasid remains committed to promoting a sustainable business model, with a focus on launching innovative products and services and solidifying its regional leadership in the production of low-carbon steel.

Key Achievements and Future Outlook

The company's strategic focus on cost reduction and new product development, coupled with a robust financial position, positions Sonasid favorably to navigate the challenges of the global steel market. With a growing domestic construction market and a commitment to sustainability, Sonasid is poised to continue its trajectory as a leading steel producer in Morocco and the region.