KAI CEO Interview with CNBC Arabia

In today’s fast-changing markets, strong leadership and smart investment are key to success. Yahya Al-Yami, the CEO of Khalifa Algosaibi Investment Company, shared his expert insights on CNBC Arabia’s popular show, "CEO Talks," on May 27, 2024. During the interview, he discussed the rich history of the company, as well as the future goals and ambitions.

The full Arabic interview may be found in the link below:

https://youtu.be/bwHbGpLJoTQ?si=VvZfnKkh-vfFh6hm

A full English transcript of the interview can be read below:

Host: Welcome to a new episode of CEO Talks. We are pleased to have with us today Mr. Yahya Al-Yami, the CEO of Khalifa Algosaibi Holding Investment Group. Mr. Yahya, welcome to CEO Talks.

Yahya Al-Yami: Thank you, it’s a pleasure to be here.

Host: Let’s start by introducing the viewers to Khalifa Algosaibi Group. Tell us about how the group started and how it has developed over the years.

Yahya Al-Yami: Khalifa Bin Abdulrahman Algosaibi is an old, pioneering company operating in several fields. It began in the late 1940s, around 1940. It is a continuation of the company established by the late Abdulrahman Bin Hassan Algosaibi, which started in the late 19th century. Khalifa, one of the sons, decided to start his own company in the 1940s. His first project was to provide rations for the Saudi army, which later became Algosaibi Catering Services, one of the largest companies in the Saudi market today. In the 1950s, another company was started in the fishing industry, which led to diving services and marine services. At one point, the group owned and operated about 60 vessels globally. In the 1970s, Algosaibi Services expanded its operations with a focus on industrial catering. Then the group shifted its vision beyond services and moved into industrial investment. This shift began in the 1980s, and today the group has around 10 companies in the industrial sector, some under the group and others in external partnerships, both locally and internationally, including in Saudi Arabia, the UK, and France. The most recent company we entered is SICAST, the only Saudi company in steel casting, with local partnerships with Al-Tamimi Group and Oxide Group. In general, this outlines the diversity, foundation, and current position of the company.

Host: The company is primarily an investment company. Can you tell us more about the types of assets and investments you pursue, and what factors you consider when evaluating investment opportunities?

Yahya Al-Yami: Since the company has a long-standing heritage in various fields, our investment strategy follows two directions: the first is expanding within the local market, and the second is attracting foreign investments or partnerships. Essentially, we build on the reallocation of existing assets and invest in these sectors. For instance, we are currently discussing opportunities with global companies in the chemical manufacturing industry in Saudi Arabia, which gives us confidence that we have the necessary infrastructure and market knowledge to take risks and expand in this field. We also have significant expertise in exporting from Saudi Arabia. We are one of the leading exporting companies in Saudi Arabia, and today we export to markets in Bangladesh, India, and Europe. This expertise allows us to confidently invest both inside and outside Saudi Arabia.

Host: What is the approximate size of your investment portfolio, and where are your investments geographically distributed?

Yahya Al-Yami: Our investments are spread across many regions, with a focus on Saudi Arabia and the Gulf region, as well as in Tunisia, Turkey, the UK, and France. Geographically, we are broadly diversified, and our assets are primarily focused on the industrial sector, which aligns with Vision 2030. When we saw the government’s direction and the infrastructure in Saudi Arabia, it became clear that the vision is for Saudi Arabia to become an industrial hub in the region.

Host: What is the approximate value of your industrial assets?

Yahya Al-Yami: I can’t provide the exact figure as it’s confidential, but we are talking about several billion for existing assets, and our expansion in this sector could potentially double this number in the future, God willing.

Host: Do you have any numbers you can share regarding the return on investment from these assets last year?

Yahya Al-Yami: Last year, we experienced significant positive changes within the group, and one of our strategies was to transition from being a local company to a global one. We implemented many policies and procedures, and this has resulted in growth on both the top and bottom lines, with an increase of around 15% to 20% last year.

Host: Is this in terms of profits or revenues?

Yahya Al-Yami: Both revenues and profits. This year, we have set ambitious targets, aiming for over 30% growth, and the results from the first quarter are promising. This gives us confidence that we can exceed our targets for the year.

Host: Could we see the company launching an initial public offering (IPO) on the Saudi market?

Yahya Al-Yami: Yes, that’s a possibility. We’ve started thinking about it and have set a plan and strategy. It may not be for the entire company, but perhaps for parts of it. In Saudi Arabia alone, we manage more than 10 companies, including AGS, one of the largest catering companies, with annual revenues reaching about a billion. Given the growth potential, especially in areas like hospitality and camps, which we haven’t entered yet, we’re optimistic about going public.

Host: A billion Riyals, correct?

Yahya Al-Yami: Yes, a billion Saudi Riyals. The company is geographically well-positioned across Saudi Arabia, with presence in NEOM, Riyadh, and the Eastern Province, working in oil, gas, and petrochemicals. We aim to expand further and hope to list on the stock market in the near future.

Host: Do you have plans to expand into new sectors?

Yahya Al-Yami: Yes, one area we recently invested in is the training sector. We acquired a company about four years ago, and it has grown by over 500%. It is expanding across government and semi-government projects in Riyadh, Jeddah, and the Eastern Province. This investment has been highly successful, as we saw the market demand for training, especially among the younger population in Saudi Arabia who are eager to acquire knowledge.

Host: What is your strategic vision for the company over the next five years? Where do you see the company going?

Yahya Al-Yami: We have a clear vision and direction, with strong foundations in manufacturing, where we’ve heavily invested since the 1980s. We own factories in Saudi Arabia, and with the country’s industrial focus, we see opportunities to form partnerships with international companies and expand into exports. Our experience positions us well for this.

Host: Many companies are increasingly investing in technology as it significantly enhances their financial returns and develops their products. How do you view technology, and to what extent are you relying on it as part of your company’s strategy?

Yahya Al-Yami: One example is when we started building SICAST. The impact of COVID-19 and other challenges made it clear that we needed to rely more on technology rather than manpower. We’ve integrated technology into many aspects of our operations, including using AI and automation in manufacturing, which helps us become more efficient and competitive. So far, we’ve invested around half a billion Riyals in SICAST, and over the next three years, we could reach a billion Riyals, as the sector is promising and based on advanced technological phases.

Host: Geographically, are there markets you haven't entered yet but see as promising?

Yahya Al-Yami: We are looking to enter many markets. Since I joined the group two years ago, I noticed we hadn’t explored the Gulf and North African markets much. Today, promising markets include Iraq and Libya, or North Africa in general. We’ve already started by appointing representatives in these regions, and we expect to invest there soon.

Host: In Iraq and Libya, are you focusing on specific sectors? Given that these are primarily oil-based economies, does that mean you plan to expand in oil and gas?

Yahya Al-Yami: Oil and gas is one of them, but there are other sectors as well. My professional background is in oil and gas, having spent 15 years with Schlumberger, including two years working in Libya. I have sufficient knowledge and experience in the Libyan market, and we expect to have a significant presence there, especially in the supply, construction materials, chemicals, insulation, fire-resistant materials, and other sectors with large potential.

Host: We wish you all the best in your endeavors, Mr. Yahya Al-Yami, CEO of Khalifa Algosaibi Holding Investment Group. Thank you for being a guest on CEO Talks.

Yahya Al-Yami: Thank you.