Saudi Pipes records net profit of SR0.9 million at end 021

Saudi Steel Pipe Co. announces its Annual Consolidated Financial Results for the Period Ending on 31-12-2021

The Saudi Steel Pipe Company recorded a net profit after zakat and tax of SR0.9 million during the 2021, compared to losses of SR34.5 million during the year before last.

The operational loss during the current period amounted to SR5.4 million, compared to losses of SR33.2 million during the same period last year, a decrease of 84%.

As for the total profit during the current period, it amounted to SR27.3 million, compared to losses of SR19 million during the same period of the previous year, a growth of 43%.

Earnings per share during the current period amounted to SR0.018, compared to losses of SR0.682 during the same period last year.

Net profit of SR 0.93 million for financial year ending 31 December 2021 (“FY 2021”) compared to a net loss of SR (34.48) million for financial year ending 31 December 2020 (“FY 2020”) is mainly due to the following reasons:

a) Profit from discontinued operations increased to SR 18.92 million in FY 2021 as compared to a loss of SR (1.36) million in FY 2020, mainly as a result of the gain recorded in FY 2021 on the sale of the main operating assets of company’s wholly owned subsidiary Titanium Steel & Manufacturing Co. Ltd. (TSM).

b) Administrative expenses decreased to SR 27.47 million in FY 2021 from SR 41.63 million in FY 2020, mainly due to the reduction of structural costs and service indemnity costs.

c) Gross profit increased to SR 27.33 million in FY 2021 from SR 19.14 million in FY 2020, mainly due to improvement in the industrial efficiency and reduction of production costs.

d) Other income amounting to SR 3.19 million in FY 2021 as compared to other expenses of SR (0.34) million in FY 2020, mainly due to the reversal of certain excess provisions in FY 2021.

The above listed positive changes were partially offset by the share of loss in an associate company (Global Pipes Company) amounting to SR (5.23) million in FY2021 compared to a share of profit amounting to SR 4.77 million in FY 2020.

The EBITDA represent earnings before interest, tax, depreciation and amortization. Adjusted EBITDA excludes non-recurrent charges.

SSP recorded a positive EBITDA of SR 39.61 million in FY 2021, including non-recurring charges, compared to SR 10.34 million in FY 2020. Excluding non-recurring charges, adjusted EBITDA is SR 44.63 million in FY 2021 compared to SR 29.95 million in FY 2020.

In addition, SSP recorded a positive free cash flow of SR 55.20 million in FY 2021 compared to SR 31.23 million in FY 2020. Net debt decreased to SR 127.98 million as at the end of FY 2021 from SR 217.24 million as at the end of FY 2020. This improvement results from cash discipline measures and working capital management implemented by the company, in addition to the proceeds from the sale of the main operating assets of TSM, a subsidiary fully owned by company.

The company said “Without qualifying our opinion, we draw attention to Note 28 to the accompanying consolidated financial statements with respect to certain electronic title deeds related to the Group land plots which became inactive due to cancellation by court order which management has learned during the year 2021.”

In addition to matter defined in note 25 of the consolidated financial statements, certain comparative figures have been reclassified, split or merged to conform with the presentation in the current year, it added.