SPIMACO cuts 2023 losses to SAR 13.7M; Q4 at SAR 49.8M

Saudi Pharmaceutical Industries and Medical Appliances Corp. (SPIMACO) narrowed its 2023 net losses to SAR 13.7 million from SAR 165 million a year earlier.

Revenue increased by 16.3% (SAR 231.3 million) year-on-year (YoY) to SAR 1.65 billion on the back of strong growth in revenue from the sale of products as well as services.

Revenue from the sale of products grew by 15.9% YoY to SAR 1.47 billion due to an improved client mix, enhanced sales in both the private and government sectors, and a surge in product demand, capitalizing on the overall positive momentum in the Saudi pharmaceutical sector.

Concurrently, revenue from services reported strong annual growth of 19.7%, supported by robust performance from medical services.

Gross profit rose by 24.9% (SAR 141.1 million) YoY to SAR 708.1 million as revenue growth outpaced the 10.5% rise in cost of revenue, which clearly reflects the increased operational efficiency and successful cost management strategies initiated during the year. This translated to a 2023 gross profit margin of 42.8% versus 39.9% last year.

Selling, general, and administrative expenses fell by 2.8% (SAR 17.7 million) YoY to SAR 604.7 million. This reflects early gains from strategic optimizations within the sales and commercial teams, as well as cautious spending throughout the year.

Research and development (R&D) expenses dropped by 2.8% (SAR 1.2 million) to SAR 41.5 million on a higher base in 2022, which included SAR 6 million of written-off R&D costs. In addition, 2023 R&D expenses, including capitalized costs, reached 3.2% of revenue.

Net finance costs increased by 73.2% to SAR 73.2 million from SAR 42.3 million in 2022, predominantly due to higher prevailing interest rates in 2023 compared to last year.

Zakat and income tax expenses increased by SAR 19.3 million to SAR 45.2 million, which includes a SAR 21 million charge related to a Zakat assessment for prior years.

The fourth-quarter net loss also declined by 53.4% to SAR 49.8 million from SAR 106.76 million in Q4 2022.

The company had posted a net loss of SAR 40.97 million for Q3 2023.

Shareholders’ equity, after minority interest, dropped to SAR 1.50 billion as of Dec. 31, 2023, from SAR 1.53 billion a year earlier.

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