Savola Group — Earnings Release 2015

Feb 24, 2016

Savola Group announces the annual financial results for the period ending on 31-12-2015

2050 · 24/02/2016 15:37:22 · Announcement #41373 · View on Saudi Exchange

Savola Group announces the annual financial results for the period ending on 31-12-2015

Element	Current year	Previous year	% Change
Net profit (loss)	1,791.7	2,072.3	-13.54
Earning or loss per share, Riyals	3.36	3.88	-
Gross profit (loss)	5,093.2	4,863.7	4.72
Operational profit (loss)	1,825.6	2,454.7	-25.63

*All figures are in (Millions) Saudi Arabia, Riyals

Element	EXPLAINATION
Reasons of annual financial results	The net profit for the year ended 31 December 2015 compared to last year registered a decline, which is attributed mainly due to the lower share of profit from one of the associates and disposal of Plastic Sector during Q1 of 2015. This is despite recording the insurance claim settlement for the fire in Raw Sugar warehouse in 2013, gain on sale of land, no impairment in non-core investment, lower net financial charges, zakat & income tax and minority share in income. Gross Profit is higher mainly due to increased revenue from Retail Sector partly off-set by lower gross profit in Food Sector. Operating income is lower mainly due to increased operating expenses, which were higher primarily as a result of opening of new stores in Retail Sector (Panda Stores) compared to last year.
Reclassifications in annual financial results	Certain comparative figures have been reclassified to conform to this year presentation.
Other notes	In the Q4 2015 interim un-audited consolidated financial statements company classified the excess of insurance claim amount over cost written-off as a part of operating income. However, based on the clarification received from the SOCPA this amount is now being classified as part of non-operating income instead of operating income in the 2015 audited consolidated financial statement. In accordance with the generally accepted accounting standards in Saudi Arabia, all amounts of income statement related to SPS have been reclassified and net income of SPS for the period ended December 31, 2014 has been reclassified as Income from discontinued operations in the interim consolidated income statement as SPS was entirely sold in Q1 2015 as announced. During December 2015, as per information provided by IMF combined with other indicators Iran ceased to be a hyperinflationary economy as of December 31, 2015. Accordingly, the Group has ceased to apply hyper-inflation accounting for Iran operation as per generally accepted accounting standards in Saudi Arabia. The Group continues to adopt hyperinflationary accounting for Savola Sudan as at December 31, 2015.

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