Al Anwar Ceramics (AACT) reported its 3Q16 headline numbers; net profit dropped 73% Y-o-Y to OMR0.37mn, missing our estimate by a wide margin (-60%) as revenue hit its lowest level since 4Q11 and was lower than our estimate. Revenue was down 33% Y-o-Y to OMR4.6mn (-24% Q-o-Q, -21% vs our estimate). Even though details are not yet available, we believe significant competition pressure lead to weaker revenue and significantly impacted the operating margin.   Our view: Another disappointing set of results for the fifth quarter in a row. Revenue and margin pressure clearly signals significant competitive pressure in its main export markets (especially in Saudi Arabia - its second largest market after Oman), largely from imported products – which probably put pressure on sales volume and prices, in our view. With a weak outlook for construction activities regionally, we expect product demand to stay muted for some time, in our view.   We assume the weak results to significantly impact our earnings estimates. We will provide more commentary and will likely revisit our estimates as soon as the full financials and volume figures are released. (Sameer Kattiparambil, Tarek El-Shawarby)   Al-Anwar Ceramics: OMR0.199 as of 11 Oct, Rating: Neutral, FV: OMR0.225 per share, MCap: USD155mn, AACT OM / AACT.OM