SGS losses down 44% in 2021 to SR254 mln

Saudi Ground Services Co. (SGS) said that its losses after zakat and tax declined by 44% to SR 254 million compared to SR 454 million during the same period of 2020.

The Saudi company added in its financial result statement published on Tadawul that it reported operational loss decrease of 58% to SR 170 million from SR 403 million.

Moreover, it reported gross profits of SR 195 million against gross losses of SR 21 million in the year before, while loss per share fell to SR 1.35 from loss per share at SR 2.42 in 2020, in addition, total comprehensive income slipped 47.5% to SR 234.5.

Lower losses were mainly due to the continuous operational recovery which directly impacted revenue to increase by 28.4% equivalent to SAR 356.1 million.

Although revenue improved by 28.4%, operating costs increased only by 11% due to the reduction of SANED support of SAR 141.7 million compared to last year indicating operating costs remained the same which reflects the continuous efforts by the company to reduce the impact of the pandemic. This resulted in a positive gross profit to increase by SAR 215.7 million. The recovery in operations along with improved collections reduced impairment loss by SAR 48.7 million.

Despite the increase in the share of loss from equity accounted investments (SAR 12.4 million), zakat expenses (SAR 13.1 million) and finance costs (SAR 14.7 million) which impacted the statement of profit or loss by SAR 40.2 million. However, the improvement in gain on FVTPL investment (SAR 6.9 million) and other income (SAR 8.4 million), reduced the impact to SAR 24.9 million on the statement of profit or loss.

Additional Information:

1) With the outbreak of COVID-19 and the suspension of domestic and international commercial flights from mid-March 2020, as a result of precautionary measures taken by the authorities, the company’s management formed a Business Continuity Executive Committee, which developed a plan with different scenarios and several possibilities to reduce the impact of COVID-19 on the expected financial results and the associated cash flows and continuously monitors the plan against the actual progress. The committee has identified initiatives to reduce costs without affecting the company’s ability to ramp-up its operational capabilities with the gradual improvement in the business operation/recovery by easing the precautionary measures set by official authorities to limit the spread of COVID-19.

2) Total revenue for the year amounted to SAR 1,607.9 million compared to SAR 1,251.8 million last year which is an increase of 28.4%. The net loss for the current year amounts to SAR 254.4 million compared to net loss of SAR 454.3 million for last year which is a decrease of 44%. The comprehensive loss for the current year SAR 234.5 million compared to comprehensive loss of SAR 446.7 million for last year which is a decrease of 47.5%. The Company has no minority interest with total shareholders’ equity reaching to SAR 2,264.7 million for the current year compared to SAR 2,499.2 million for last year which is a decrease of 9.4%.