Yanbu Cement Company

An Industrial Lighthouse in the Making

A Legacy of Nearly Five Decades

Pointed Toward the Future

Yanbu Cement Company was established in 1977 and began operations in 1979 with two dry kilns, each producing 3,000 tons of clinker per day. Nearly five decades later, the company operates two production lines with a combined daily clinker capacity of 21,000 tons, an annual clinker output of 7 million tons, and cement packing and delivery capacity of 30,000 tons per day. It is the largest cement company in the western region of Saudi Arabia and one of the largest in the Kingdom, with a paid-up capital of SAR 1.575 billion, a market capitalization of SAR 6.38 billion, and revenues of SAR 876 million in 2024, up 6 percent from 2023, with net profit growing 31 percent to SAR 157 million.

That financial trajectory reflects operational discipline, not favorable market conditions. The broader Saudi cement sector in 2024 faced overcapacity, compressed margins, and export headwinds from Red Sea geopolitical disruption. Yanbu grew its sales and profit in that environment by building the kind of operational, digital, and sustainability capability that converts market presence into competitive advantage. The company’s vision captures this ambition precisely: to always be the first choice for its partners. Everything in the transformation agenda is oriented toward earning that position, not merely claiming it.

The SIRI Assessment

16 of 16 Dimensions Best-in-Class

The SIRI assessment conducted in May 2023 produced a result that is, across the entire FCI article series, unmatched. Yanbu Cement achieved Best-in-Class status on all 16 SIRI dimensions, with zero dimensions in the bottom performers range and zero in the broad middle range. Every single dimension scored above the General Manufacturing industry average. This places Yanbu Cement not just at the top of the Saudi cement sector in digital maturity, but at the frontier of global manufacturing more broadly.

The detailed scores explain why. Connectivity achieved Band 5 (Scalable) across all three dimensions: Shop Floor, Enterprise, and Facility. This means that production assets, enterprise IT systems, and facility systems are all interoperable, real-time, and scalable, with cybersecurity embedded throughout. Leadership Competency achieved Band 5 (Adaptive), recognizing that management can independently adapt the organizational transformation framework to changing trends and technologies without dependence on external partners for conceptual guidance. Workforce Learning and Development achieved Band 4 (Adaptive), reflecting integrated L&D programs actively developed and refreshed based on stakeholder feedback loops. Shop Floor Intelligence achieved Band 4 (Predictive), the level at which computerized OT and IT systems can diagnose problems and predict future states of assets and systems, not just identify deviations.

The production technology underpinning these scores is specific. Lines 4 and 5 are fully automated by FLSmidth ECS/ControlCenter with Siemens S7-400 control systems. The ECS/ProcessExpert (PXP) system, a model-based predictive control application, optimizes raw meal blending in real time using inputs from the QCX laboratory system, which itself incorporates AutoSampling, RoboLab, and BlendExpert modules. The ECS/UptimeGo application automates downtime root cause analysis. At the finished goods warehouse, packing and loading are fully automated by packing machines and robotic systems. Enterprise processes are managed by Oracle Cloud ERP with automated workflow engines that can be modified on the fly, and the company was in the process of deploying an Oracle Cloud Customer Experience (CX) platform for customer self-service at the time of the SIRI assessment.

The assessor’s forward-looking recommendations reflect the quality of the starting point. Rather than identifying gaps, the assessor focused on the transition from integration to automation: in Vertical Integration, moving toward automatic synchronization between planning and daily operations via further OT-IT integration; in Horizontal Integration, moving toward a supply chain digital twin using Advanced Planning and Scheduling; and in Shop Floor Intelligence, moving toward adaptive intelligence where predictive models prescribe solutions under all conditions rather than simply predicting outcomes.
The company has since progressed along all three of these vectors, launching the Tayseer ERP project, the largest digital transformation initiative in the company’s history, and deploying AI-driven automation programs that monitor industrial process key indicators, including temperature and feed rates, and make operational decisions in real time. The AI system continuously learns from past process analyses, progressively enhancing its own predictive capabilities.

Recognized as a Future Factories Leader

In January 2023, Yanbu Cement launched an ambitious strategy structured around four pillars: institutional maturity, business excellence, sustainability and growth, and business diversification with enhanced governance. That strategy has already produced measurable recognition. The company achieved second place nationally in the Ministry of Industry and Mineral Resources’ Future Factories Program, evaluated under the SIRI framework by INCIT. It was subsequently nominated among the top 20 qualified companies to become a global industrial lighthouse, recognized by the World Economic Forum as among the world’s most advanced manufacturing facilities in Industry 4.0 adoption.

The company also received the Governance Indicators Improvement Award for the third consecutive year at the International Corporate Governance Conference in Riyadh in December 2024, evaluated by the Corporate Governance Center at Al Faisal University. These two recognitions, for digital maturity and governance quality, are not separate stories. They reflect a single integrated transformation that has embedded performance, transparency, and accountability simultaneously across the organization.

Sustainability

The First ESG Report and a Documented Carbon Pathway

In 2024, Yanbu Cement published its first annual sustainability report, prepared in accordance with GRI Standards 2021. The report documents, for the first time in the company’s history, its full environmental footprint, social performance, and governance framework in a format accessible to external stakeholders and benchmarkable against international standards.
The headline environmental achievement is the Waste Heat Recovery system, which meets approximately 25 percent of the facility’s total electricity demand from thermal energy that would otherwise be lost through kiln exhaust. The WHR contribution reduces dependence on fossil-fuel-based captive power generation and has contributed to a cumulative CO2 reduction of 100,000 tons annually since implementation. Total Scope 1 and 2 GHG emissions in 2024 were approximately 4.69 million tons of CO2 equivalent, with 99.9 percent attributable to Scope 1 (direct) sources, primarily calcination and fuel combustion in kilns.

The company has established a documented carbon reduction pathway targeting 30 percent reduction in CO2 intensity per ton of cement by 2030 compared to its 2020 baseline of 0.810 tons CO2 per ton of cement. The pathway is structured around seven levers: green additive substitution in the product portfolio (6.6 percent reduction contribution), fuel switching to natural gas and alternative fuels (9.4 percent), energy efficiency in raw mills, cement mills, and operations excellence (5.4 percent combined), renewable electricity (6 percent), afforestation (1 percent), voluntary carbon markets (5 percent), and new technologies including carbon capture (72 percent of the long-term 2060 net-zero ambition). The 2024 actual intensity of 0.739 tons CO2 per ton of cement reflects progress from the 2020 baseline, with further reductions accelerating as fuel and product mix changes take effect.

The specific power consumption trajectory confirms the energy efficiency trend: from 122 kWh per ton of cement in 2018 to 107 kWh per ton in 2024, achieved through operational improvements including Line 4 pyroproduction rehabilitation, process expert system deployment, and transition to LED lighting across 85 percent of indoor facilities. Thermal energy consumption for clinker production has fallen from 831 kcal per kg in 2018 to 780 kcal per kg in 2024.

The company obtained Environmental Product Declaration certifications for all four of its product types, OPC Premium, PPC, SRC, and LPC, registered and published through the SCS Global Services international platform.

These EPDs provide independently verified life-cycle environmental data for each product, enabling customers and contractors to document the carbon profile of their construction materials and earn credits under LEED and other green building schemes.

Green Cement, EPDs, and the Product Portfolio

Yanbu’s product portfolio reflects its sustainability positioning. PPC (Portland Pozzolana Cement) uses natural pozzolana as a partial clinker substitute at up to 30 percent substitution, delivering lower CO2 intensity and improved durability in sulfate-rich and chloride-exposed environments. LPC (Limestone Portland Cement) uses limestone as a clinker substitute at up to 35 percent substitution, producing a bright finishing product with reduced carbon footprint. The company has been increasing green additive proportions across its product mix, with the sustainability roadmap targeting further increases in SCM substitution rates through 2030.

The company is also studying the transition from traditional paper cement bags to eco-friendly plastic bags, reflecting attention to downstream sustainability across the full product life cycle, including packaging waste. The subsidiaries support this portfolio strategy: Yanbu Saudi-Kuwaiti Paper Products Company, a wholly owned subsidiary established in 2005 with annual bag production capacity of approximately 160 million bags, provides an integrated packaging capability, while the Cement Knowledge Center for Training, a joint venture with FLSmidth, develops the technical workforce required to operate and improve advanced production systems.

The Cement Knowledge Center

Building the Sector's Next Generation

The Cement Knowledge Center for Training, established as a joint venture between Yanbu Cement and Denmark’s FLSmidth, is one of the most distinctive elements of the company’s contribution to the sector. The center has a capacity of 100 trainees annually and offers short, medium, and long-term training programs designed to equip Saudi engineers with the practical and theoretical knowledge required for the cement industry. In 2024, the center graduated 20 Saudi engineers from its Engineers Professional Development Program (EPDP), a six-month program designed to qualify newly graduated engineers for the labor market through project-based learning that addresses real operational challenges.

The graduation ceremony was attended by officials from the Ministry of Industry and Mineral Resources and the Ministry of Human Resources and Social Development, recognizing the center’s role in localizing essential industrial expertise. From FCI’s perspective, this initiative represents something the sector as a whole needs: an institutional model for building the Saudi cement engineering talent base that will be needed as the industry’s transformation deepens. Yanbu Cement is not just transforming itself. It is building the training infrastructure for the sector’s next generation.

Marine Conservation and Environmental Stewardship

Yanbu Cement’s environmental commitment extends beyond the plant fence. The company is a key partner in the Ras Beridi Turtle Reserve Development Project, supporting the conservation of endangered hawksbill sea turtles and green sea turtles in the Red Sea, adjacent to the company’s coastal plant location. The initiative includes advanced hatchery development for baby turtles, coastal sand rehabilitation to support nesting, tree planting for environmental diversity, architectural development meeting international nature reserve standards, and complete replacement of the factory beach lighting system with specialized turtle-safe lighting designed to prevent disorientation of hatchlings.

Yanbu Cement also participated in the First International Conference on Marine Turtle Conservation in the Red Sea in collaboration with the Shams Initiative, and its contribution to the National Afforestation Program was recognized by the Minister of Environment, Water and Agriculture. The company targets planting 200,000 seedlings by 2030, completing its 2025 target of 25,000 trees on schedule. In 2024, the company also participated in the Regional Voluntary Carbon Market auction organized by Saudi Arabia’s Voluntary Carbon Market, with credits registered under the VERRA program and aligned with the CORSIA standards, formalizing its engagement with the international carbon credit ecosystem.

What This Means for the Sector

From FCI’s perspective, Yanbu Cement is the most comprehensively documented transformation case in the Saudi cement sector. The combination of 16-of-16 SIRI Best-in-Class performance, second place nationally in the Future Factories Program, nomination for Global Lighthouse Network candidacy, the Kingdom’s first GRI-aligned sustainability report from a cement company, EPDs for all products, a documented 30 percent CO2 reduction pathway, a Waste Heat Recovery system meeting 25 percent of plant electricity demand, governance award recognition for three consecutive years, and the industry-unique Cement Knowledge Center training model represents a breadth and depth of transformation that sets a new benchmark for the sector.

The fact that Yanbu Cement’s SIRI assessment was conducted with Mohamed Zayed in the role of Performance Manager as Point of Contact reflects an alignment between this FCI article series and the company’s transformation journey that goes beyond documentation. Yanbu Cement’s experience is, in many respects, the reference architecture against which the broader sector can orient its own development roadmaps.

The industrial lighthouse is not yet formally designated. But the trajectory is clear, and the evidence is documented.