FIPCO’s 2023 profit rises 23% to SAR 12M; Q4 at SAR 7.1M

Filing and Packing Materials Manufacturing Co. (FIPCO) reported a net profit leap of 32% to SAR 12 million in 2023, compared to SAR 9.8 million in 202

The annual bottom line was driven by an increase in gross profit despite a decline in sales, due to the sales mix variance and improved profit margins.

FIPCO also reported lower selling and marketing expenses amid decreased shipping rates. Further, the expected credit losses provision decreased in accordance with IFRS 9, thanks to the company’s improved collections, enhanced control and the recognition of some credit facilities to some customers as guarantees to mitigate the risks of default and non-payment.

The paper manufacturer also recorded a decline in Zakat provisions and a rise in other income on obtaining the Saudization support from Human Resources Development Fund (HRDF), in addition to VAT refunds for bad debt write-offs.

FIPCO also recorded a Murabaha deposit income through optimal exploitation of the company’s available cash in 2023.

On the other hand, the sales volume of some key products declined amid lower selling prices.

General and administrative expenses increased, due to higher staff costs.

Realized and unrealized gains of investments at fair value through profit or loss resulted also declined from liquidating most investments.

The fourth-quarter net earnings jumped 13% to SAR 7.1 million from SAR 6.2 million in Q4 2022.

On a sequential basis, Q4 net profit soared 92.1% from SAR 3.6 million.

Total shareholders’ equity, no minority interest, reached SAR 143.7 million as of Dec. 31, 2023, compared to SAR 132 million in a year-earlier period.

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