Shatirah House records profit decline of 19.1% in 2021

Shatirah House Restaurant Co. announced that its net profit after zakat and tax decreased 19.1% to SR 15.4 million in 2021 from SR 19 million in 2020.

The company said in its financial result statement that the operational profit fell 18.5% to SR 17.8 million last year from SR 21.8 million.

Gross profit rose by 8.2% to SR 66 million against SR 61 million in 2020, while profit per share slipped to SR 6.15 from SR 7.6.

The decrease of net profits was due to:

Revenues: were increased as compared to last year by approximately 19.89% due to current market conditions and increase in number of branches to 94 by the end of the current year as compared to 79 branches at the end of previous year. 15 new branches were added and two branches were replaced during the year.

Gross profit: Increased by only 8.26% as compared to the increase in revenue of 19.89% as a result gross profit margin reduced from 31.11% in 2020 to 28.10% in 2021. Mainly due to the increase in raw material costs and increase in labor costs resulted from increase in Saudization requirement plus increased outsource labor and relevant costs due to COVID 19 restrictions (travel ban and quarantine etc.). In addition, higher freight and packaging costs contributed to lower gross profit.

Selling Expenses: Increased by SAR 4.6 million, or 22.61%, in line with volume and revenue growth.

Administrative Expenses: Increased by SAR 4.5 million, or 23.87% in line with general business growth.

Others: Finance costs are increased by SR 139.8 thousand, other expenses are reduced by SR 334.7 thousand and other income is increased by SR 101.2 thousand.