Savola Group — Earnings Release 2018

Mar 19, 2019

The Savola Group announces its Annual financial results for the year ended on 2018-12-31

2050 · 19/03/2019 15:20:02 · Announcement #53866 · View on Saudi Exchange

The Savola Group announces its Annual financial results for the year ended on 2018-12-31

Element List	Current Year	Previous Year	%Change
Sales/Revenue	21,814.6	23,830.5	-8.459
Total Profit (Loss)	3,898	4,394.1	-11.29
Profit (Loss) Operational	277	803.2	-65.512
Net Profit (Loss) after Zakat and Tax	-520.4	1,025.6	-
Total Comprehensive Income	-1,106.9	567.5	-
Total Share Holders Equity (after deducting minority equity)	7,127.4	8,828.9	-19.271
Profit (Loss) per Share	-1	1.9
All figures are in (Millions) Saudi Arabia, Riyals

Element List	Explanation
Reason for increase (decrease) in net profit for current year compared to last year	The reason for net losses for the year ended December 31, 2018 as compared to the net profit for the year ended December 31, 2017 is mainly attributed to the following:

1- certain non- recurring gains recognized in the comparable period as follows:

- Gain amounting to SR 693.9 million on disposal of 2% ownership interest in Almarai;

- Non-recurring net positive impact for the Group of SAR 62 million from gain on disposal of leasehold rights by Panda Retail Company, of its Hyper Panda store in Dubai Festival City Mall, UAE; and

- Non-recurring net positive impact for the Group of SAR 30 million due to recognition of dilution gain net of option cost, upon deconsolidation of United Sugar Company Egypt, considered as an associate effective March 28, 2017, after issuance of shares to the European Bank for Reconstruction and Development (EBRD)

2- During 2018, an exceptional expense amounting to SR 100.7 million in relation to a guarantee given to an associate’s subsidiary has also resulted in the increase in loss for the year.

3- Lower gross profits due to lower sales and margins in food and retail sector;

4- Lower share of profit from an associate;

5- Higher share of losses from other associates mainly due to the impairment loss recorded at the associate level;

6- Higher zakat and income tax; and

7- Higher net finance cost mainly due to the currency exchange losses.

Operating expenses including the impairment loss were lower compared to the prior year.

In addition to the increase in the net losses for the year as disclosed above, the increase in total comprehensive loss for the year ended December 31, 2018 as compared to total comprehensive income for the year ended December 31, 2017 is attributed due to the following:

•Increase in foreign currency exchange losses relating to the overseas subsidiaries due to devaluation and translation impact; and

•Decrease in share of associates’ other comprehensive income.

The increase in comprehensive loss was recorded despite of the reduction in the losses on “investments held at fair value through other comprehensive income. Type of the external auditor's opinion Unmodified opinion Reclassifications in annual financial results Items, elements and notes of the comparatives Consolidated Financial Statements have been redisplayed, regrouped and reclassified to meet with the applied accounting policies for the current year, which have been prepared according to the International Financial Reporting Standards (IFRS) that are endorsed in the Kingdom of Saudi Arabia. Certain comparative amounts have been reclassified to conform to the current year’s presentation. Additional Information We would like to inform the investors that the consolidated financial statements of the Group for the year ended December 31, 2018 will be uploaded on Savola website after submitting it to the concerned authorities, and will be accessed through the following link: http://www.savola.com/SavolaE/Financial_Reports.php

The Capital Market Authority and Saudi Exchange take no responsibility for the contents of this disclosure, make no representations as to its accuracy or completeness, and expressly disclaim any liability whatsoever for any loss arising from, or incurred in reliance upon, any part of this disclosure, and the issuer accepts full responsibility for the accuracy of the information contained in it and confirms, having made all reasonable enquiries, that to the best of their knowledge and belief, there are no other facts or information the omission of which would make the disclosure misleading, incomplete or inaccurate.