Chairman's Message

Esteemed Shareholders,

I would first like to welcome you and am honored to meet with you at our annual meeting to review the main milestones in the progress of your company during 2016.

With regard to our financial performance during the year, your company was largely affected by the turmoil taking place in our region, but continued to achieve positive results with a net profit attributed to the shareholders of the parent company of KD 7.238 million compared to KD 8.380 million in 2015. We seek to continue the progress of your company in the coming years while keeping pace with the changes and developments taking place in the local and regional markets in which we seek to maximize the company’s share, with a view to achieving further positive results for our business.

The company’s total revenues rose to KD 98.626 million last year from KD 97.575 in 2015. The Board of Directors has recommended the distribution of a cash dividend of 15 Fils per share and a bonus share distribution at the rate of 5 Fils per share. The Board also recommended the payment of Board of Directors remunerations for a total amount of KD45,000 in appreciation for their efforts. These recommendations are subject to the approval of the Company’s general assembly.

ACICO for Industries Company has been keen to lay a strong foundation for its business through its corporate governance policy adopted by the Board of Directors. Corporate governance embodies a set of policies, proce-dures and sound practices that are instrumental in directing, monitoring and controlling business and activities in all the Company’s units, in addition to an effective set for reports which help in ensuring that the most appropriate decisions are taken, thereby promoting the principles of transparency and fairness and achieving the objectives of the Company and stakeholders. ACICO has been carefully seeking to keep abreast with developments and new ideas in the field of corporate governance.

In conclusion, and in the name of our Board of Directors and all the employees, I wish to present to our es-teemed shareholders our deepest thanks and appreciation for your valuable support to the Company’s progress, your judicious guidance to the Board of Directors and your trust which we view with deserved gratitude and without which it would have been impossible for us to make the achievements we have made. We will always be committed to maximizing your rights in the coming years.

On behalf of our esteemed shareholders, we express our deep appreciation to the executive management for their efforts in drawing a strategy to strengthen the Company’s future performance, and for all the employees of ACICO Group for the results achieved during 2016, and take the liberty to urge them to continue their sustained efforts, wishing them all further success in the near future.

Abdul Aziz Ahmed Abdullah Al-Ayyoub

Honorable Shareholders,

I would like first to thank you, for myself and on behalf of the members of the Board of Directors and the Executive Management of ACICO for Industries Company, and am pleased to take you through the performance of your company and present the company’s financial statements for the year ended 31 December 2016.

The Company’s Achievements

ACICO Group’s achievements this year were quite varied but are mainly visible in two key areas: first, investment in the human element and second, expansion of several operational activities of the Group.

First: Investment in the Human Element

Our investment in our human resources is by far our most important investment, and the retention and promotion of this element has been the main theme of our plans and strategies. To this end, the Group succeeded during 2016 in re-structuring and creation of new departments within the framework of its endeavor to increase the efficiency and effectiveness of the Group companies, maintain a high level of transparency in line with the growth witnessed at Group level and in order to ensure that all sectors con-tribute to the creation of an added value. Within this framework, the best management practices were adopted and implemented in order to optimize performance and results.

Second: Expanding our Operational Activities

In our view, demand for building and construction materials will increase as a direct result of the in-fra-structure projects announced by the State and the strategic projects targeted for execution under the second development plan (2015/2016 – 2019/2020) drawn by the General Secretariat of the Higher Coun-cil for Planning within the “Kuwait Vision 2035”. A key announced project is the extension and develop-ment of Kuwait International Airport (Passengers Terminal 2), Sheikh Jaber Al-Ahmad Bridge Project and the Clean Fuel Project, as well as several housing projects that the Public Authority for Housing Welfare is executing under its five-year plan which consists of several projects which include Sabah Al-Ahmad City, Jaber Al-Ahmad City, North West Sulaibkhat Project, the existing Wafra Project and its extension, West Abdullah Al-Mubarak Project, South Mutlaa Project, Al-Khairan City Project, , South Saad Al-Abdullah city Project, South Sabah Al-Ahmad City Project, Nawaf Al-Ahmed Project and Sabriah City.

Against this background, the Group launched the extension of the cement production line designed to keep pace with these new projects, as part of its ongoing efforts to increase its market share and benefit from the opportunities that present themselves in the market. This decision was taken after we had seen a remarkable growth in our Cement Sector and after the plant had reached its full production capacity.

Furthermore, we succeeded in increasing the size of our trans-mixer fleet, used in carrying ready mix concrete, with a view to cater for the rapid growth of our sales driven by the start of the execution of the new projects that had been announced earlier. This sector continues to be promising given the number of strategic projects and housing cities to be constructed of which is scheduled to start over the coming two years.

Mr. Ghassan Ahmad Saud Al Khaled
Vice Chairman & CEO

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