TALCO CEO: Exports, better sales mix drove Q2 profit jump

Sulaiman Al Oufi, CEO of Al Taiseer Group Talco Industrial Co. (TALCO), said the company's higher second-quarter net profit came from operating efficiency and the execution of its commercial strategy. Key drivers included higher sales volumes, an improved sales mix, stronger product demand, export sales growth, and expansion into new international markets.

In an interview with Argaam, Al Oufi said second-quarter revenue rose 25% on higher sales volumes and improved product pricing, partly supported by higher aluminum prices on global exchanges. The company implemented flexible pricing while maintaining competitiveness, he said.

TALCO's aluminum segment delivered strong performance on higher sales volumes and improved pricing. Powder coatings revenue was driven mainly by better pricing. The accessories segment benefited from both higher volumes and pricing improvements.

Despite volatility in global aluminum prices, the company limited the impact on raw material costs and margins through operational flexibility and efficient supply chain, procurement, and production management, supporting continued revenue and earnings growth.

Al Oufi said demand remained healthy in both domestic and export markets, supported by ongoing construction and industrial activity. Major Saudi development projects boosted local demand. Regional markets grew on strong customer relationships and the company's reputation. Integrated solutions and value-added products were key growth drivers.

On geopolitical developments, he said TALCO maintained stable operations through diversified sourcing, flexible supply chains, and proactive measures approved by the board earlier this year. Raising inventory levels served as a precaution against potential disruptions, supporting the reported financial results.

Al Oufi said higher freight costs and changes in delivery schedules had only a limited impact, despite slightly affecting demand and sales volumes. The company maintained growth through diversification across markets and production segments.

Capacity utilization stands at 81% in aluminum, 55% in powder coatings, and 75% in accessories, Al Oufi said. Existing production capacity is sufficient to meet expected demand growth under the company's expansion plans.

For the third quarter of 2026, Al Oufi expects demand to remain stable despite potential sector-wide volatility. The company is focusing on expanding market share and its customer base, increasing the contribution of value-added products, and improving operational efficiency and cost management.

TALCO's first-half 2026 net profit rose 19% year-on-year to SAR 51.1 million from SAR 43 million. Second-quarter profit increased 28% to SAR 27.5 million, according to Argaam's data.