Marmore Capital Allocation Efficiency Scores (MCES) - Material Sector

Executive Summary

Efficient Capital Allocators have been found to generate superior shareholder returns and is relevant for investors targeting superior shareholder returns. Companies are faced with the task of making capital allocation decisions to sustain their current operations (working capital and maintenance capex), drive future growth (capital investments & acquisitions) and boost shareholder returns (dividends) while maintaining financial risk at prudent levels

This report assesses the capital allocation efficiency of material sector companies listed in the Saudi Arabian stock market through a composite Marmore Capital Allocation Efficiency Score (MCES) using a factor model. The five companies analysed are:

• SABIC
• ABIC Agri-nutrients
• Saudi Kayan Petrochemicals
• Yanbu Petrochemicals
• Saudi Mining Company