Savola Group — Interim / Quarterly Report 2015

Jul 28, 2015

Savola Group announces the interim financial results for the period ending on 30-06-2015 (Six Months)

2050 · 28/07/2015 15:56:46 · Announcement #39364 · View on Saudi Exchange

Savola Group announces the interim financial results for the period ending on 30-06-2015 (Six Months)

Element	Current quarter	Similar quarter for previous year	% Change current	Previous quarter	% Change previous
Net profit (loss)	434.4	513.3	-	470.5	-
Gross profit (loss)	1,372.1	1,251.4	9.65	1,181.6	16.12
Operational profit (loss)	554.4	671.2	-	386.3	43.52
All figures are in (Millions) Saudi Arabia, Riyals

Element	Current period	Similar period for previous year	% Change
Net profit (loss)	904.9	936.5	-
Gross profit (loss)	2,553.7	2,344.3	8.93
Operational profit (loss)	940.7	1,202	-
Earning or loss per share, Riyals	1.69	1.75	-
All figures are in (Millions) Saudi Arabia, Riyals

Element	EXPLAINATION
Reasons of increase (decrease) for quarter compared with same quarter last year	The decrease in the Group net income for 2nd Q 2015 compared to the same quarter last year is attributed mainly due to the capital gain recognized during Q2 last year due to disposal of Kazakhstan operations, dividend received from one of the associate during Q2 last year, lower share of profit from an associate during this quarter and disposal of Savola Packaging Systems Co. (SPS) earlier this year as well as the increase in zakat & foreign income tax for this quarter, despite reduced financial charges and Minority share in income Gross Profit increased for this quarter compared to same quarter of last year due to the growth in revenues, operating income was lower due to increased operating expenses because of growth in Retail Sector compared to same quarter last year.
Reasons of increase (decrease) for period compared with same period last year	The decrease in the Group net income for the period ended June 2015 compared to the same period last year is attributed mainly to reduced share of net income and dividend income from some associates, increased capital gain on disposal of investment and positive impact of reduced minority interests despite increased financial charges, zakat and foreign income tax and disposal of Savola Packaging Systems Co during Q1 of 2015. Gross Profit increased for the period compared to same period of last year due to the growth in revenues and despite increased cost of revenues, operating income was lower due to increased operating expenses because of growth in Retail Sector compared to same period last year.
Reasons of increase (decrease) for quarter compared with previous quarter	The decrease for 2nd quarter 2015 net profit compared with the previous quarter is mainly attributed to the capital gain of SAR 265.2 million achieved in Q1 2015 as a result of the sale of Group entire shares in Savola Packaging Systems Company, increase in operating expenses due to growth in retail sector, zakat and foreign income tax and minority interests, despite the growth in revenues, increased share of net income from associates and lower financial charges.
Reclassifications in quarterly financial results	Certain comparative figures have been reclassified to conform to this quarter presentation.
Other notes	In accordance with the generally accepting 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 June 30, 2014 has been reclassified as Income from discontinued operations in the interim consolidated income statement as SPS has been entirely sold in Q1 2015. Eng. Abdullah M. Noor Rehaimi - Group Managing Director/CEO, highlighted that by the Grace of Allah, the 2nd quarter net income (without capital gain) reached SAR 434.4 Million which is 1.3% higher than the announced forecast of SAR 429 Million. He indicated that Savola expects to achieve a net income (before capital gains) of SAR 355 Million for the third quarter of 2015, God willing. He also stated, given the current overseas market/economic conditions in the countries it operates and continuing oversupply of commodities, large expansion in retail sector, which has put pressure on the margins, Savola expects that its full year guidance may be affected negatively by approximately 10%.

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