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Savola Group announces its Interim Financial Results for the Period Ending on 2019-09-30 ( Nine Months )

Element ListCurrent QuarterSimilar quarter for previous year%ChangePrevious Quarter% Change
Sales/Revenue 5,335.95,2122.3776,023.9-11.421
Gross Profit (Loss) 1,084.293216.331,163.2-6.791
Operational Profit (Loss) 427.1169.9151.383363.717.431
Net Profit (Loss) after Zakat and Tax 221.8-50.7-110.2101.27
Total Comprehensive Income 216.1-554.4-100116.1
All figures are in (Millions) Saudi Arabia, Riyals
Element ListCurrent PeriodSimilar period for previous year%Change
Sales/Revenue 16,747.716,467.61.7
Gross Profit (Loss) 3,312.82,907.413.943
Operational Profit (Loss) 996.6464.4114.599
Net Profit (Loss) after Zakat and Tax 338.35.65,941.071
Total Comprehensive Income 326.4-598.5-
Total Share Holders Equity (after Deducting Minority Equity) 7,453.97,634.2-2.361
Profit (Loss) per Share 0.630.01
All figures are in (Millions) Saudi Arabia, Riyals
Accumulated LossesCapital
05,339,806,840
All figures are in (Millions) Saudi Arabia, Riyals
Element ListExplanation
Increase (Decrease) in Net Profit for Current Quarter Compared to the Same Quarter of the Previous Year is Attributed to The net profit for the 3rd Quarter 2019 achieved is SAR 221.8 million compared to the net loss of SAR 50.7 million for the same quarter last year.

This is mainly attributed to the following:

- Higher gross profit due to higher sales and margins;

- Higher share of profit from associates;

- Lower net finance cost mainly due to the reduction in currency exchange losses;

- Lower operating expenses; and

- Zakat and tax provision reversal relating to prior years’ assessments for one of the subsidiaries.

The net profit was achieved despite of the higher zakat and income tax expense.

In addition to the net profit performance as explained above, the total comprehensive income recorded for the current quarter compared to total comprehensive loss for the same quarter last year is mainly due to the following:

- Significant decrease in the foreign exchange losses relating to the overseas subsidiaries;

- Decrease in the share of other comprehensive loss relating to “investments in equity accounted investees”; and

- Decrease in loss resulting from the fair value change in the “investments at fair value through other comprehensive income”.

Increase (Decrease) in Net Profit for Current Quarter Compared to the Previous Quarter is Attributed to The net profit for the 3rd Quarter 2019 has increased to SAR 221.8 million as compared to the net profit of SAR 110.2 million for the 2nd Quarter 2019.

The increase is mainly attributed to the following:

- Significant decrease in the operating cost;

- Increase in the share of profit from associates;

- Decrease in the finance cost mainly due to the reduction in currency exchange losses;

- Zakat and tax provision reversal relating to prior years’ assessments for one of the subsidiaries; and

- Lower zakat and tax expense.

The increase in the net profit recorded is despite of the lower gross profits due to lower sales.

In addition to the net profit performance as explained above, the increase in the total comprehensive income recorded for the 3rd Quarter 2019 compared to total comprehensive income for the 2nd quarter 2019 is mainly due to the decrease in the foreign exchange losses relating to the overseas subsidiaries;

The total comprehensive income achieved is despite of the following:

-Decrease in the share of other comprehensive income relating to “investments in equity accounted investees”; and

- Decrease resulting from the fair value change of the “investments at fair value through other comprehensive income”

Increase (Decrease) in Net Profit for Current Period Compared to the Similar Period of the Previous Year is Attributed to Net profit for the period ended 30 September 2019 has increased to SAR 338.3 million as compared to the net profit of SAR 5.6 million for the similar period last year.

The increase is mainly attributed to the following:

- Higher gross profit due to higher sales and margins;

- Lower operating cost; and

- Zakat and tax provision reversal relating to prior years’ assessments for one of the subsidiaries.

These results were recorded despite the following:

-Lower share of profit from an associate;

- Increase in the net finance cost resulting mainly from the adoption of new leasing standard (IFRS 16) applied during 2019, being partially compensated by the reduced foreign currency exchange losses;

- A gain on disposal of investment in the comparable period; and

- Higher zakat and income tax expense.

In addition to the net profit achieved as disclosed above, the total comprehensive income achieved for the period ended 30 September 2019 compared to the total comprehensive loss for the period ended 30 September 2018 is attributed to the following:

-Significant decrease in the foreign currency exchange losses relating to the overseas subsidiaries;

-Decrease in the share of other cmprehensive loss relating to “investments in equity accounted investees”; and

-Increase resulting from the fair value change in the “investments at fair value through Other Comprehensive Income”;

Basis of the External Auditor's Opinion Unmodified opinion
Reclassification of Comparison Items Items, elements and notes of the comparatives Condensed Consolidated Interim Financial Statements have been re-displayed, regrouped and reclassified to meet with the applied accounting policies for the current period, which have been prepared according to the International Financial Reporting Standards (IFRS) that are endorsed in the Kingdom of Saudi Arabia. For more information, please refer to note 17 (Amendments to standards and standards issued and not yet effective) in the Condensed Consolidated Interim Financial Statements for the period ended September 30, 2019 and September 30, 2018.
Additional Information In this respect, Eng. Anees Moumina, Group Chief Executive Officer of Savola Group highlighted that “Our Group has been working closely to realign growth strategies, turnaround plans, and cost optimization initiatives. The plans we have put are bearing fruits through the improvement of the results”.

We would like to inform the shareholders and investors that the condensed consolidated interim financial statements of the Group for the third quarter ended September 30, 2019 will be uploaded on Savola website after submitting it to the concerned authorities, and can be accessed through the following link:

http://www.savola.com/SavolaE/Financial_Reports.php

The Capital Market Authority and the Saudi Stock 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.

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