Al-Othaim Markets profits decline 32% in 2021

Abdullah Al Othaim Markets Company (Al Othaim Markets) recorded a 32.3% decline in annual profits for the year 2021, reaching 305 million riyals, compared to 450.9 million riyals, in 2020.

According to Arabiya Net, the company's quarterly profits fell by 6.6% in the fourth quarter of 2021, to 154.6 million riyals, compared to 165.5 million riyals in the corresponding period from The year 2020.

On a quarterly basis, profits increased by 244.6%, compared to 44.8 million riyals in the previous quarter.

The company said in a statement, that the decline in quarterly profits is due to the decline in the profit margin due to the increase in promotions and the change in consumer behavior by focusing on discounted items, as well as the increase in selling and distribution expenses as a result of the opening The new branches, and the increase in administrative expenses as a result of strengthening the administrative staff in leadership positions.

Real estate activity also started to recover after witnessing a decline in the same quarter of the previous year.

The performance of subsidiaries and associates has improved, as they were affected by precautionary measures in the same quarter of the previous year.

The results of the corresponding quarter included a non-recurring profit of 6.67 million riyals from the revaluation of the assets available for sale related to the discontinued agricultural activity.

And about the reasons for the decline in annual profits, the company said that it is due to the decline in sales by 4.63%, as the first half of the previous year witnessed a large demand from customers to buy in anticipation of preventive measures. from the spread of the Corona pandemic. Customers also increased their demand for purchase before the increase in value-added tax on 1/7/2020.

The profit margin also decreased due to the increase in promotions and the change in consumers' behavior by focusing on discounted items. Selling and distribution expenses increased as a result of the opening of new branches, as well as administrative expenses as a result of recording fees. Consultation regarding the acquisition of the Fourth Mill Company and the strengthening of the cadre in leadership positions, as well as benefiting from government initiatives in the previous year.