RAK Ceramics to sell stake in pharmaceutical unit

RAK Ceramics plans to sell its stake in a pharmaceutical business in Bangladesh as part of its plans to divest non-core assets.

RAK Ceramics Bangladesh will sell its 55 per cent stake in RAK Pharma, the Ras Al Khaimah-based firm said. It did not reveal the identity of the buyers. The firm is offloading all its shares in RAK Pharma, it added.

“Firstly, our strategy is to focus on our core activities – tiles, sanitaryware, taps and faucets and tableware. In addition, RAK Pharma is a loss-making division so it makes good business sense to sell it at this time,” the chief executive Abdallah Massaad said. “The RAK Ceramics Bangladesh board had previously approved the increase in capacity of tiles and sanitaryware production in Bangladesh and this expansion is already under way and will be completed in 2015.”

In Bangladesh, work is under way to increase sanitaryware production to 4,350 pieces a day from 3,350 pieces a day.

The Abu Dhabi-listed company will also expand its tile production by 10,000 pieces a day in the third quarter of next year in Bangladesh.

RAK Ceramics said last week that it planned to sell its business in Sudan and use the proceeds from the sale to increase its production capacity in the UAE.

The transaction will also help the company avoid operational issues regarding the import of raw materials and spares.

It will also prevent further financial losses stemming from hyperinflation and foreign-exchange losses.

The company’s losses in Sudan reached Dh16.48 million at the end of September this year. The sale of the Sudan business was expected to be concluded by the end of March next year, said RAK Ceramics.

The company said it plans to increase its sanitaryware production in the UAE by 500,000 pieces a year, but did not elaborate.

At present, it produces 8,000 pieces of sanitaryware a day in the UAE and 12,000 pieces a day globally, according to its website.

RAK Ceramics’s net profit in the third quarter fell 15 per cent because of hyperinflation accounting in Sudan and Iran, where it took a Dh46.8m hit because of currency devaluation. RAK Ceramics shares closed flat at Dh3 yesterday.

dalsaadi@thenational.ae

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Tax authority targets shisha levy evasion

The Federal Tax Authority will track shisha imports with electronic markers to protect customers and ensure levies have been paid.

Khalid Ali Al Bustani, director of the tax authority, on Sunday said the move is to "prevent tax evasion and support the authority’s tax collection efforts".

The scheme’s first phase, which came into effect on 1st January, 2019, covers all types of imported and domestically produced and distributed cigarettes. As of May 1, importing any type of cigarettes without the digital marks will be prohibited.

He said the latest phase will see imported and locally produced shisha tobacco tracked by the final quarter of this year.

"The FTA also maintains ongoing communication with concerned companies, to help them adapt their systems to meet our requirements and coordinate between all parties involved," he said.

As with cigarettes, shisha was hit with a 100 per cent tax in October 2017, though manufacturers and cafes absorbed some of the costs to prevent prices doubling.

What is the Supreme Petroleum Council?

The Abu Dhabi Supreme Petroleum Council was established in 1988 and is the highest governing body in Abu Dhabi’s oil and gas industry. The council formulates, oversees and executes the emirate’s petroleum-related policies. It also approves the allocation of capital spending across state-owned Adnoc’s upstream, downstream and midstream operations and functions as the company’s board of directors. The SPC’s mandate is also required for auctioning oil and gas concessions in Abu Dhabi and for awarding blocks to international oil companies. The council is chaired by Sheikh Khalifa, the President and Ruler of Abu Dhabi while Sheikh Mohamed bin Zayed, Abu Dhabi’s Crown Prince and Deputy Supreme Commander of the Armed Forces, is the vice chairman.

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