Dairy, Juice Sector Contribution to “Almarai” Revenues, sharply, Dropped

Contribution of the dairy and juice products sector to Almarai Company’s revenues, in the third quarter 2021, decreased to 69.02%, the lowest rate since the fourth quarter of 2019 at 68.59%.

The sector’s contribution posted 72.67% in the second quarter 2020, the highest percentage during that past period.

The baking sector, on the other hand, raised its share to 11.86% (the highest since the second quarter of 2020), compared to 10.85% in the third quarter of 2020 and 10.01% in the second quarter of this year.

For its part, the poultry sector’s contribution increased on an annual basis to 13.74% compared to 13.58% in the third quarter of 2020, while it decreased on a quarterly basis compared to 14.13%, but the percentage of other sales rose to 5.38% compared to 3.85%and 3.57% in the third and second quarters of this year, respectively.

Revenues by sectors since the fourth quarter of 2019 (in million riyals)

Dairy, juice products Bakery Poultry Other sales Total
Q4-2019 2,541 479 609 75 3,704
Share of the total % 68.59% 12.94% 16.44% 2.03% 100%
Q1-2020 2,520 433 558 81 3,592
Share of the total % 70.15% 12.05% 15.54% 2.26% 100%
Q2-2020 2,966 424 615 77 4,082
Share of the total % 72.67% 10.39% 15.06% 1.88% 100%
Q3-2020 2,770 419 525 149 3,863
Share of the total % 71.71% 10.85% 13.58% 3.85% 100%
Q4-2020 2,667 436 595 122 3,820
Share of the total % 69.82% 11.41% 15.58% 3.19% 100%
Q1-2021 2,581 391 552 121 3,645
Share of the total % 70.82% 10.73% 15.14% 3.31% 100%
Q2-2021 2,896 401 566 143 4,006
Share of the total % 72.29% 10.01% 14.13% 3.57% 100%
Q3-2021 2,721 467 542 212 3,942
Share of the total % 69.02% 11.86% 13.74% 5.38% 100%

Almarai’s revenues climbed by 2.04 % to SR3.94 billion, in the third quarter of 2021, compared to SR3.86 billion, in the same quarter previous year, but declined by 1.59 % to revenues of SR4.01 billion, in the second quarter of 2021,”Maaal”, the leading Saudi online business daily reported.

The dairy and juice area was the lone revenue loser in the third quarter, falling 1.79% on an annual basis and 6.04% on a quarterly basis, while the bakery, poultry, and other sales sectors climbed by 11.49%, 3.22%, and 42.55%, respectively.

On a quarterly basis, the bread sector climbed 16.58 percent and the other sales sector increased 48.5%, while the poultry sector decreased 4.34%.

Revenues by sector since the beginning of the Year 2020 (in million riyals)
Dairy, juice products Bakery Poultry Other sales Total
Q1-2020 2,520 433 558 81 3,592
Quarterly growth % -0.81% -9.67% -8.31% 7.83% -3.01%
Q2-2020 2,966 424 615 77 4,082
Quarterly growth % 17.70% -1.99% 10.07% -5.37% 13.62%
Q3-2020 2,770 419 525 149 3,863
Quarterly growth % -6.60% -1.18% -14.62% 93.79% -5.36%
Q4-2020 2,667 436 595 122 3,820
Quarterly growth % -3.73% 3.94% 13.39% -18.08% -1.13%
Q1-2021 2,581 391 552 121 3,645
Quarterly growth % -3.21% -10.24% -7.26% -1.04% -4.57%
Q2-2021 2,896 401 566 143 4,006
Quarterly growth % 12.17% 2.51% 2.60% 18.44% 9.89%
Q3-2021 2,721 467 542 212 3,942
Quarterly growth % -6.04% 16.58% -4.34% 48.48% -1.59%
Yearly growth % -1.79% 11.49% 3.22% 42.55% 2.04%

Despite the increase in revenues, total profit, operational profit, and net profit declined by 15.78 %, 30.87 %, and 34.18 %, respectively, on an annual basis, while the three items decreased by 5.9%, 13.80 %, and 15.12 %, respectively, on a quarterly basis.

Item evolved from income statement, since Q1, 2020
Revenues Gross profit Operational profit Profit before zakat and tax Profit earmarked for shareholders
Q1-2020 3,592 1,253 513 386 383
Quarterly growth% -3.01% -3.12% 2.91% 12.16% 22.78%
Q2-2020 4,082 1,535 759 641 644
Quarterly growth% 13.62% 22.50% 48.06% 65.98% 68.13%
Q3-2020 3,863 1,515 750 633 622
Quarterly growth% -5.36% -1.33% -1.19% -1.22% -3.48%
Q4-2020 3,820 1,232 500 367 336
Quarterly growth% -1.13% -18.64% -33.33% -42.04% -45.95%
Q1-2021 3,645 1,235 502 412 386
Quarterly growth% -4.57% 0.22% 0.44% 12.31% 14.90%
Q2-2021 4,006 1,356 602 508 482
Quarterly growth% 9.89% 9.77% 19.77% 23.26% 24.88%
Q3-2021 3,942 1,276 519 433 409
Quarterly growth% -1.59% -5.90% -13.80% -14.69% -15.12%
Yearly growth % 2.04% -15.78% -30.87% -31.56% -34.18%

Net profits in the third quarter of 2021, totaled SR409 million, were the lowest (at the third quarter level) since 2009, when they totaled SR363 million, and the percentage decline in net profits was 34.2%, the highest percentage decline since the company was listed on the market and the tenth in that period. All of the declines occurred within the last five years, or since the first quarter of 2016.

The company has not reported any loss in the 67 quarters, since it was listed on the stock exchange, and its profits have only dropped in 10 of those quarters.

Almarai’s highest quarterly profits were recorded in the third quarter of 2017, when profits totaled SR665 million, while the lowest quarterly profit was recorded in the first quarter of 2005, when profits totaled SR77.9 million, indicating that the company has been on an upward trajectory throughout that time.
It’s worth mentioning that the company’s operations are seasonal.

In terms of financial condition, the company’s total assets declined by 4.67% by the end of the third quarter of 2021, following declines of 3.24% in non-current assets and 9.02% in current assets, respectively, compared to the third quarter of previous year.

On a liability level, current liabilities climbed by 25.27%, while non-current liabilities fell by 27.38%.

Item Evolution from the balance sheet, since Q1, 2020
Total assets Non-current assets Current assets Total Equity Non-current liabilities Current liabilities
Q1-2020 32,727 25,656 7,071 15,321 12,566 4,840
Quarterly growth% -1.27% -0.65% -3.47% 0.41% 3.30% -15.46%
Q2-2020 33,069 25,489 7,580 15,161 12,548 5,361
Quarterly growth% 1.05% -0.65% 7.20% -1.05% -0.14% 10.76%
Q3-2020 33,555 25,253 8,302 15,886 12,369 5,300
Quarterly growth% 1.47% -0.93% 9.52% 4.78% -1.43% -1.13%
Q4-2020 32,344 25,055 7,289 16,234 11,435 4,675
Quarterly growth% -3.61% -0.78% -12.20% 2.19% -7.55% -11.78%
Q1-2021 32,741 24,821 7,920 16,621 11,127 4,992
Quarterly growth% 1.23% -0.93% 8.65% 2.39% -2.69% 6.78%
Q2-2021 32,646 24,698 7,948 15,974 11,396 5,276
Quarterly growth% -0.29% -0.50% 0.36% -3.90% 2.42% 5.69%
Q3-2021 31,988 24,435 7,553 16,367 8,982 6,639
Quarterly growth% -2.02% -1.06% -4.98% 2.46% -21.19% 25.84%
Q4-2021 32,646 24,698 7,948 15,974 11,396 5,276
Early growth% -4.67% -3.24% -9.02% 3.02% -27.38% 25.27%