eXtra CEO says continued revenue growth reflects higher market share

Mohamed Galal, CEO of United Electronics Co. (eXtra)

United Electronics Co. (eXtra) continued to post revenue growth in the second quarter of 2024, reflecting its robust market share and ability to maintain its strong position in the Saudi market, Managing Director and CEO Mohamed Galal told Argaam.

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He added that this was part of the company's ambitious growth plan and development of operational efficiency.

The second-quarter profit growth year-on-year (YoY) mirrors the significant improvement in the company's revenues and its ongoing efforts to improve operational efficiency, Galal said.

He noted that gross profit increased by 14.3% to SAR 389 million in Q2 2024 compared to SAR 340 million in the same quarter last year, which enhances eXtra's financial strength and ability to report sustainable profits.

If the SAR 38 million loss incurred in Q2 2023 due to the company's decision to halt expansion plans in Egypt is excluded, the company's net profit will grow by 7% YoY, reflecting its strong performance and commitment to achieving strong growth in the long-term, the CEO said.

The retail segment posted 9.2% YoY revenue growth, and the mega sales achieved great success this year, thanks to the best online and in-store offers. This was due to having a full range of products, in addition to offering a seamless and integrated shopping experience across all channels.

Online sales grew by about 53% YoY, reaching their highest level ever, supported by continuous improvements in the digital platform, online shopping experience, and investment in enhancing e-commerce infrastructure.

Online sales represented 25% of eXtra's top line, which indicates its ability to meet changing customer needs and enhance its digital experience, Galal said.

He added that the Jood program that provides additional discounts during mega sales saw strong demand, reflecting an increase in the program’s customers.

Speaking on the consumer finance segment, Galal said that the financing portfolio of United International Holding Co., the owner of United Company for Financial Services (Tasheel Finance), posted YoY growth, driven by a rise in the customer base of Tasheel and Baseeta.

This growth mirrors the firm's commitment to continually developing its products, meeting diverse customer needs and improving the efficiency of services provided through its digital channels, which positively affected revenues.

As for the financial performance of United International Holding, the CEO said the decline in the company's earnings was due to the negative impact of higher costs of expected credit loss provisions and an increase in financing expenses. However, he highlighted the company's ability to continue with its future growth plans.

Further, Galal said the Capital Market Authority's approval for United International Holding to register and float its shares represents a significant strategic step, which will support future expansion and growth plans.

This development indicates the great confidence that eXtra enjoys in the Saudi market. It also enhances the company's position in the retail and electronics segments, the CEO said.

He added that the company will focus on innovation and continuous improvement to meet changing market needs. eXtra reported a net profit of SAR 200.4 million in the first half of 2024, compared to SAR 146.1 million in the year-earlier period. The second-quarter net profit rose 73% YoY to SAR 106.5 million, according to data available with Argaam.