RIYADH: Jeddah-based Middle East Paper Co. is still working to get a factory fully operational after the fatal floods that hit the city last week prompted a production shutdown.
The company revealed the record rainfall — which left two people dead in the city — caused work to stop in its Al Khumrah plant on Nov. 24.
According to a disclosure with the Saudi stock exchange — known as Tadawul — about 40 percent of production was back online within 48 hours, but the firm estimates it could take until Dec. 5 for the factory to be working at full capacity.
The statement said that while there was an “impact on some logistical activities”, there were “no human injuries.”
“The financial impact will be determined after the restoration of production capacity and operation,” the company added.
Earlier this month, the paper company, known as MEPCO, revealed its plants were operating at above 92 percent production despite declining commodities demand.
The paper manufacturer reported net earnings valued at SR245 million ($65 million) for the first nine months of 2022 — an annual increase of 95 percent.
The firm’s CEO Sami Safran said at the time that MEPCO was riding out a global weaking for commodity demand — including paper products — thanks to consistent domestic demand.
He added that MEPCO, on average, exported 40 percent of its output, boosting its growth plans, and although shipping costs rose in the first half of the year, they slightly declined in the third and fourth quarters.
At the end of October, MEPCO invited its shareholders to vote on increasing its capital to SR666 million to support the company’s financial position and growth plans.
According to a bourse filing, the Saudi-listed paper manufacturer’s board proposed a 33 percent capital hike from the current capital of SR500 million.
Rainfall in the southern area of Jeddah on Nov. 24 was the highest amount ever recorded, according to Saudi Arabia’s National Center for Meteorology, with 179mm of water falling between 8am and 2pm.
As well as causing disruption to roads — with footage posted online showing cars being swept away — there was also an impact on air travel.
King Abdulaziz International Airport, based to the north of Jeddah, urged passengers to contact airlines for schedules as “due to weather conditions, the departure of some flights has been delayed”.
