Saudi companies squandering shareholders ’equity to extinguish losses and others that lie in their place

Special Report - (Namazone):

A number of Saudi listed companies tend to extinguish their accumulated losses, or part of them, by sacrificing the rights of shareholders, by reducing the capital and other companies are still in their place.

Namazone reviews developments in the accumulated losses of the Saudi companies listed on the Saudi stock market, according to the latest financial statements of companies.

The list of Saudi companies that have accumulated losses witnessed 20% or more of their capital, new companies joined, other companies exited from the list, some companies reduced their accumulated losses, and losses increased Other companies.

The Saudi financial market (Tadawul) divides these companies into 3 ranges: yellow, orange, and red, with the yellow range comprising losses from 20% to 35%, and orange from 35. % To 50%, and red for losses 50% or more.

decrease losses

And a group of companies managed to reduce their accumulated losses during the past period, either by reducing the capital, or achieving profits during the year 2019.

Inaam Holding Company managed to get rid of all its accumulated losses, after it announced the approval of the General Assembly of the company last December, to reduce its capital by 92.35% to 15 million riyals .

The company's accumulated losses amounted to about 181 million riyals, at the end of the third quarter of 2019, representing 92.3% of its capital, which was 196 million riyals, before the reduction.

The company raised net losses during the year 2019 to 97.76 million riyals, compared to losses of about 15 million riyals in 2018, to jump net losses by 551.6%.

For its part, Tabuk Agricultural Development recently announced a decline in its accumulated losses to 36.49 million riyals, representing 15.1% of the capital, as a result of the decrease in capital.

Last March, the company's general assembly agreed to reduce the capital by 46.27% from 450 million riyals to 241.77 million riyals.

Tabuk Agriculture jumped with net losses during 2019 by 186.7% to 179.8 million riyals, compared to a net loss of 62.7 million riyals for the year 2018.

loss height

On the other hand, a group of companies raised their accumulated losses, and Wafa Insurance topped this list, after its accumulated losses increased 89.7% to 176.45 million riyals, representing 176.45% From its capital of 100 million riyals.

The company explained that the reason for the accumulated losses is mainly due to the losses resulting from the operations and stopping the sale.