SUCCESSFUL EVOLUTION

Saudi Arabia 2017 | CONSTRUCTION & REAL ESTATE | INTERVIEW

TBY talks to Jamal Amrhar, General Manager of Construction Material Chemical Industries (CMCI), on the development of the firm and the state of the sector.

Jamal Amrhar
BIOGRAPHY
Jamal Amrhar is the General Manager of CMCI. He has a PhD in organic chemistry with 22 years of hands-on experience with industry leaders in paints and coatings in the Middle East and North Africa.

What was behind the creation of CMCI over three decades ago, and how has the company evolved since?

The growing demand for construction chemicals in Saudi Arabia and the Gulf was behind the establishment of CMCI back in 1984. The company grew from one production facility in Dammam First Industrial City to three production facilities at present and a planned production facility in Bahrain in the coming months. Today, the company produces a wide range of construction chemicals serving all building and construction projects requirements starting from the foundation to the finishing stages. Our successful evolution over the years was not only built on our breakthrough technology throughout the manufacturing process, nor just in our procuring the highest-quality raw materials, but also in implementing the toughest quality control and quality assurance measures at our manufacturing facilities and testing laboratories.

How would you describe the key sectors and clients served by CMCI in the local market?

CMCI services the biggest companies in the Saudi market across a broad variety of sectors. We are proud to serve the biggest oil company in the world, Saudi Aramco, as well as SABIC, the Royal Commission of Jubail and Yanbu, and SEC. Whether the project is a mega industrial project like SATORP or SADARA, or a refinery project like Jazan Refinery, our products are catered toward serving the most advanced companies and technologies across the country. We also have experience in supplying key industrial complexes like MAADEN's Ras Al Khair, in addition to housing projects in Jubail, Dhahran, and Riyadh with SABIC. Our well-established presence within the construction sector has given us access to products and services to major builders such CCC, Azmeel, Khonaini, Nesma, NCC, SSEM, Gussan, Sinopec, and China Harbor, to name few.

How has CMCI looked to overcome challenges related to the drop in the oil price, and with Vision 2030 reforms firmly in place, is the sector back on the stage of growth?

The decline of oil prices has been reflected in the number of projects delivered in recent years, which has been quite low. While we are happy to see that many of the notable megaprojects, including KAEC and Jeddah Tower, are back on and momentum is growing, as there have been significant delays or cancellations that have impacted the industry over the years. However, CMCI had its strategy shifted from focusing on mega industrial projects to focus on housing, power, and maintenance projects. The result of this strategy enabled CMCI to reduce the effects of the construction market slowdown to a minimal and diversify our growth strategy for when the construction sector rebounds, as we are seeing signs today. CMCI believes the construction market has huge potential in the years ahead and we are working on our strategy in anticipation of this. The increase of oil prices recently provides us the confidence in the market's prosperity and growth. On top of this, we are encouraged by the widespread Vision 2030 reforms and the impact this will have on the industrial, power, construction, and oil and gas sectors. It shows that the country has a vision, and we are aligning ourselves accordingly.

What proportion of your production caters to GCC and wider Middle East markets, and how are you aiming to expand your overall exports?

Our present exports share is between 10 and 15% of our total turnover. However, CMCI plans are to increase our export market to 25-30% in the coming years, focusing on Gulf countries and other parts of the Middle East as well. As already mentioned, we expect to open a new plant in Bahrain in the coming months, which will support our growth ambitions in the region. In addition to this, extensive marketing efforts will be exerted and we will restructure our export department to be closer to our customers. We are on the constant lookout for international opportunities and are excited about building our business further.

What are your expectations for the year ahead?

Since the beginning of 2017 we are witnessing uncertainty in the market, resulting in some of the large contractors being withdrawn from the market due to financial difficulties. Nonetheless, things are gradually starting to pick-up again and we believe the market is now moving toward stability. In light of this, we have focused the majority of our projects toward housing and power projects as the growing demand in both sectors suggest that upcoming projects are both necessary and inevitable. We are also expecting Aramco to release new projects toward the end of the year, and as we have seen with its recent IKTVA initiative to support localized supply chains, we are eagerly anticipating the opportunities that will arise in the years ahead.