Saudi "Almarai" profits increase 7% in the third quarter

Saudi Almarai Company achieved a growth of 7% in its third-quarter profit to reach 621 million riyals, compared to 581 million riyals in the third quarter of last year. < / p>

According to Arabiya Net, the company's profits during the 9-month period rose to 1.6 billion riyals by 10%, compared to 1.5 billion riyals in the same period last year. .

The reason for the increase in the net income attributable to the shareholders of the company for the third quarter of 2020 compared to the same quarter of the previous year, by 6.9%, is mainly due to:

- Revenue: Despite the VAT increase from 5% to 15% on July 1 of this year, there has been growth in sales in almost all sectors. This led to the long-term food and milk sector driving growth in double digits, the only exception being the bakery category due to the decrease in the scale of single use.

in terms of the sales channel, the growth was mainly driven by the retail channel and higher exports driven by product availability. Food service channel performance rebounded from the second quarter of 2020 after the epidemic restrictions (COVID-19) were lifted, but it has remained flat year on year. In terms of geographical growth, the Kingdom of Saudi Arabia was in the first place, followed by Kuwait, and then Egypt.

- Gross profit: rose 4.9% at a lower rate due to higher input costs for the juice sector, feed cost, higher labor costs and additional costs related to safety measures to manage the COVID-19 pandemic .

- Selling and distribution expenses: increased by 47.9 million riyals, at a rate of 8.1%, which was due to higher labor costs, increased growth in the retail channel and increased distribution costs in line with the increase Revenue.

- General and administrative expenses: increased by 4.4 million riyals at a rate of 5.6%, due to the continuation of work at a lower operating rate than revenue growth due to cost management initiatives.

Other expenses: increased by 16.2 million riyals, due to the high losses from the sale of cows, which come at a normal time.

- Finance cost: Funding costs decreased by SAR 13.4 million as the benefits of lower interest rate and lower debt levels were partially offset by lower capitalization of financing cost in the expense program Capitalism.