Red Sea 9M 2024 net loss shrinks to SAR 45.6M; Q3 at SAR 23.3M

Red Sea International Co. reported a net loss excluding minority interest of SAR 45.6 million for the first nine months of 2024, compared to SAR 52.7 million in the year-earlier period.

Losses before excluding minority interest were trimmed to SAR 2.2 million from SAR 54.7 million a year earlier.

Losses per share stood at SAR 1.51 for 9M 2024 from SAR 1.74 a year earlier.

Losses per share are calculated by dividing net profit after excluding minority interest by the weighted average number of shares

Red Sea narrowed its net loss in the period ending Sept. 30, 2024 thanks to a 516% year-on-year (YoY) jump in revenues, reaching SAR 2.1 billion.

This increase was driven by the strategic acquisition of a 51% stake in Fundamental Installation for Electric Work Co. (First Fix) and continuous operational efficiency enhancements.

The company reported improved Q3 2024 results, with a net loss of SAR 23.3 million, compared to SAR 14.9 million in Q3 2023.

The shift was largely due to its transformation strategy, marked by acquiring 51% of Primary Electrical Installations Company, coupled with amortization charges on intangible assets linked to the acquisition.

The company reduced losses in Q3 2024 compared to the year-earlier period thanks to a 480% YoY revenue surge, totaling SAR 705 million.

Red Sea widened losses in Q3 2024 to SAR 23.3 million, compared to a SAR 14.96 million loss in Q3 2023.

The company incurred losses in the current quarter compared to a net profit of SAR 11.8 million in Q2 2024, due to a slight revenue decline due to timing of revenue recognition in financial statements and lower revenues and margins from fixed cost settlements.

The group’s revenues rose to SAR 705 million in Q3 2024, from SAR 121 million in Q3 2023, marking a 480% increase.

General construction revenues reached SAR 646 million, driven by consolidating Primary Electrical, while Building sales revenues dropped 55% quarter-on-quarter (QoQ), from SAR 83 million to SAR 37 million. Rental revenues from investment properties fell 42% QoQ from SAR 38 million to SAR 22 million.

Gross profit climbed to SAR 74.5 million in Q3 2024 from SAR 5.9 million in Q3 2023, supported by consolidating Primary Electrical and cost-efficiency measures, resulting in a gross margin of 10.56%.

Operating profit rose to SAR 15.9 million in Q3 2024, reversing a SAR 8.6 million operating loss in Q3 2023, driven by strong growth in general construction.

Selling, marketing, and administrative expenses increased to SAR 58.53 million due to consolidation of Primary Electrical results and intangible asset amortization.

Total shareholders’ equity (excluding minority interest) stood at SAR 25.70 million by Sept. 30, 2024, compared to SAR 65.44 million a year earlier.

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