Bawan Profits Increased to SR41 Million during the 3Q by 38%

Bawan Company net profit after zakat and tax amounted to SR41 million during the 3Q, compared to SR30 million during the same quarter of the previous year, at a rate of 38%.

This came after Bawan Company announced on Wednesday its interim financial results for the period ended September 30, 2021 (Nine Months).

The gross profit amounted to SR96 million during the 3Q, compared to SR87 million during the same quarter of the previous year, an increase of 10%.

The operational profit amounted to SR49 million during the 3Q, compared to SR36 million during the same quarter of the previous year, an increase of 34%.

The net profit after zakat and tax during the current period amounted to SR126 million, compared to SR60 million during the same period of the previous year, an increase of 109%.

Profits per share during the current period amounted to SR2.1, compared to SR1 during the same period of the previous year.

The reason for the increase in net profit during the current quarter was mainly due to the following:

-The increase in the sales and net profit of the metal and wood industries sector affected by the increase in the quantities sold of the metal products and average selling price of metal and wood products.

-The increase in the sales of the electrical industries sector affected by the increase in the average selling price which led to achieving profit as compared to losses for the same quarter of the previous year.

-The increase in the sales and net profit of the plastic industries sector affected by the increase in quantities sold and the average selling price.

-Decrease in finance costs due to the repayment of a portion of the loans.

-Decrease the expected credit loss allowance on financial assets.

-Achieving insignificant gain from discontinued operations as compared to losses in the same quarter of the last year.

This was despite the increase in operational expenses and Zakat, which was a result of the growth in the business and operations, realizing losses in the concrete industries sector affected by the decrease in the average selling price, and decrease in other income and profit from re-evaluation of investment in financial assets at fair value through profit or loss.

The reason for the decrease in net profit during the current quarter was mainly due to the following:

-The decrease in the sales and gross profit is mainly affected by the decrease of the quantities sold of metal products.

-Decrease in other income.

This was despite the decrease in operational expenses, finance costs, zakat, and the expected credit loss allowance on financial assets, also realizing insignificant gain from discontinued operations as compared to losses for the previous quarter, decrease in the losses in the concrete industries sector as compared to the previous quarter affected by the increase in the quantities sold, and the increase in profit from re-evaluation of investment in financial assets at fair value through profit or loss.

The reason for the increase in net profit during the current period was mainly due to the following:

-The increase in the sales and net profit of the metal and wood industries sector affected by the increase in the quantities sold and average selling price of wood products.

-The increase in the sales of the electrical industries sector affected by the increase in the quantities sold which led to achieving profit as compared to losses for the same period of the previous year.

-The increase in the sales and net profit of the plastic industries sector affected by the increase in quantities sold and the average selling price.

-Decrease in finance costs due to the repayment of a portion of the loans.

-Increase the profit from disposal and re-evaluation of investment in financial assets at fair value through profit or loss.

-Decrease in the expected credit loss allowance on financial assets.

-Decrease in the losses of the discontinued operations.

This was despite the decrease in other income, increase in operational expenses, and zakat, which was a result of the growth in the business and operations, and the increase of the concrete industries sector losses affected by the decrease in the quantities sold and average selling price.

Some of the comparative figures for the same quarter and the same period of the previous year have been reclassified for each of revenue, gross profit and operational profit previously announced on the company’s financial results for the Interim financial results for the period ended on 30/09/2020, relating to reclassification of SR 1.9 million and SR 4.2 million for the same quarter and the same period of the previous year respectively from other income to revenue. In addition, the balance related to gain / (loss) from discontinued operations has been reclassified into a separate line item.

For more details, please refer to note number 20 in the condensed consolidated interim financial statements for the period ending on 30/09/2021.

Non-controlling interests share during the current quarter amounted to a profit of SR 2.1 million as compared to a loss for the same quarter of the previous year of SR 1.4 Million with an increase of 250.0%, and Non-controlling interests share during the current period amounted to a profit of SR 1.6 million as compared to a loss for the same period of the previous year of SR5.5 Million with an increase of 128.5%.