BinDawood Holding CEO says resumption of Umrah lifted Q1 sales; tackling inflation, supply chain issues

Ahmad Abdulrazzaq BinDawood, CEO

BinDawood Holding Co.’s store sales grew exponentially after the lifting of government restrictions and return of pilgrims, CEO Ahmad BinDawood told Argaam in an exclusive.

“Both BinDawood and Danube stores have performed well sequentially. We were able to tap into two major promotional campaigns - Sha’ban and Back to School - which greatly benefited our sales,” he stated.

Lifting of the pandemic restrictions has seen the return of pilgrims to Makkah and Madinah, as well as the return of more regular tourist and business travelers, coupled with greater freedom of movement.

“This has led to higher consumer spending and an increase in footfall through our stores in the Makkah and Madinah – translating to a strong performance and a good contribution to the increase in revenue,” he explained.

BinDawood stores saw a 13.9% and 18.5% uptick in sales year-on-year and sequentially, respectively.

Concerning inflation and supply chain challenges, BinDawood noted that the company has several different initiatives such as product mix management, shrink management and cost of goods sold

(COGS), among others.

“We are confident it will provide us with the right mix to ensure we maintain our strong gross margin.”

This comes in addition to investing heavily in local supplier relationships to ensure the strength and stability of the company’s supply chain.

He also emphasized that BinDawood Holding has a strong network of local suppliers in some categories and currently enjoys a very healthy inventory level. The company has been managing well to date but remain very vigilant, he indicated.

Speaking on the Hajj season, BinDawood noted that it is traditionally one of the company’s busiest seasons and prepares in advance to ensure a smooth running of operations during the period.

“We have 15 BinDawood stores and two Danube stores (launched last year) in Makkah and Madinah. We hope for a full return of Hajj season this year and remain optimistic”, he added.

Sharing his Q2 2022 financial outlook, the CEO said that BinDawood Holding had a “very good” performance across all financial metrics and are quietly optimistic we have finally turned a corner.

“We are unable to provide guidance, but we believe with a strong Ramadan and Eid season, as well as our ability to run promotions and marketing campaigns, we are confident in the year ahead,” he noted.

BinDawood Holding Co. reported a net profit after Zakat and tax of SAR 65.5 million for Q1 2022, increasing 5% from SAR 62.1 million in the year-earlier period, according to data compiled by Argaam.