Savola records profit surge of 76% to SR271 mln in 1Q

Savola Group announced that its profits after zakat and tax rose 76% to SR 271 million in the first quarter of 2022 compared to 154 million during the same period of 2021.

This came after Savola announcement on Monday of the preliminary financial results for the period ending on 31.03.2022 (three months).

The company’s operational profit climbed 42% to SR 529 million in the 1^st quarter of the current year from SR 373 million in the same period of the previous year.

Gross profit of Savola advanced 6% to SR 1.28 billion in the first quarter of this year from SR 1.21 billion a year ago, while the profit per share soared to SR 0.51 from SR 0.29.

The increase in the net profit for the 1st quarter, 2022 compared to the net profit for the same quarter last year is attributed mainly to the following:

– Increase in the gross profit is primarily due to the higher sales volume that was partially offset by higher commodity prices in the Food Processing segment;

– Higher share of profits from associates; and

– Lower operating expenses.

The increase in net profit is recorded despite of the following:

– Higher net finance cost; and

– Higher zakat and income-tax expense.

The Group reported Revenues of SAR 7.5 billion during Q1 2022 showing a 26% increase compared with same quarter last year.

Food Processing segment reported Revenues of SAR 4.3 billion during Q1 2022 showing a 48.9% increase compared with same quarter last year due to higher volumes and continued recovery in B2B channel and increases in commodity prices.

Retail segment reported Revenues of SAR 2.8 billion during Q1 2022 showing a 3% increase compared with same quarter last year due to impact of pre-Ramadan sales.

The Group recorded a net profit during Q1 2022 amounting to SAR 271 million versus net loss of SAR 254 million for the previous quarter ended 31 December 2021, which is due to the following:

– Impairment loss, amounting to SAR 421.9 million, being recorded in the quarter ended 31 December 2021;

– Increase in the gross profit is primarily due to the higher sales volume that was partially offset by higher commodity prices in the Food Processing segment; and

– Higher share of profits from associates.

The Group recorded a net profit despite the following:

– Higher net finance cost; and

– Higher zakat and income-tax expense.

Items, elements and notes of the comparatives in the Condensed Consolidated Interim Financial Statements have been redisplayed, regrouped and reclassified to meet with the applied accounting policies for the current period, which have been prepared according to the International Financial Reporting Standards (IFRS) that are endorsed in the Kingdom of Saudi Arabia. For more information, please refer to Note 18 (Amendments to standards and standards issued and not yet effective) in the Condensed Consolidated Interim Financial Statements for the period ended March 31, 2022 and March 31, 2021.

Additional Information:

Revenue by segment before inter segment eliminations:

For the first quarter 2022 as compared to same quarter previous year, revenues increased in the Food Processing, Retail, Food Services and Frozen Food segments by 48.9%, 3.2%, 5.8% and 5.4% respectively.

Gross profit increased by 6% during Q1 2022 compared to same quarter last year driven by improvement in Foods segments, that was partially offset by reduction in gross profit in Retail segment. Increase in the gross profit in the Food Processing segment is primarily due to the higher sales volume that was partially offset by higher commodity prices.

Net profit by segment:

For the first quarter 2022 as compared to same quarter previous year, net profits from the Food Processing, Food Services, Frozen Food and Investments segments increased by 37.8%, 14.7%, 7.3% and 73.6% respectively. The Retail segment recorded a net loss of SAR 34.8 million in the first quarter 2022 compared to a net loss of SAR 51.7 million in the same quarter previous year.

The Condensed Consolidated Financial statements for the period ended 31st March 2022, will be available through the following link on Savola’s website, and Savola’s Investment Relation App after sending it to the relevant authorities: http://www.savola.com/SavolaE/Financial_Reports.php

The quarterly investor presentation will be available on Savola’s website within the Investors section at the following link:

https://www.savola.com/en/investors/investor-relations/financial-information/earnings-presentations