Arabian Centres net profit declines 33% to SAR 153.1 mln in Q1 2020/21

Arabian Centres Co. reported a net profit after Zakat and tax of SAR 153.1 million for the three-month period ending on June 30, 2020 (Q1 2020/21), a decline of 33% year-on-year (YoY), compared to SAR 227 million in year earlier period.

The profit decline is attributed to lower revenue, higher advertisement and promotion costs, higher impairment loss on accounts receivable despite lower general and administrative (G&A) expenses, and lower cost of revenue.

In addition, increased depreciation of right-of-use assets and higher interest expense on lease liabilities in line with IFRS 16 requirements also weighed on the first quarter results.

When compared to the previous quarter, profit increased by 58.1% driven by higher other income, lower other expenses, lower advertisement and promotion costs, drop in impairment loss on accounts receivable, lower G&A expenses, and lower interest expense on lease liabilities, despite lower revenues.