Savola’s Q1 2024 profit dips 11% to SAR 348.7M

Savola Group posted a net profit drop of 11% to SAR 348.7 million in the first quarter of 2024, compared to SAR 392.8 million in the prior-year period.

Net profit of the food processing segment in Q1 2024 declined to SAR 205 million, compared with SAR 258 million a year earlier. The segment's performance was impacted by foreign exchange losses of SAR 109 million upon devaluation of the Egyptian pound during Q1 2024.

The company also cited the impact of one-offs recorded in Q1 2023 that comprised capital gain of SAR 18.5 million on the disposal of investment in Savola Morocco Co., as well as the refund of custom duty from regulatory authority in Saudi Arabia, with a net impact of SAR 23.3 million.

The profit decline was also due to lower share of profits from associates, as well as higher operating expenses, in addition to higher net finance cost by SAR 83 million, primarily due to impact of the Egyptian pound devaluation in Q1 2024, and an increase in prevailing interest rates.

This was despite the improvement in the retail segment's performance, as it turned to a net profit of SAR 33 million in Q1 2024 from a net loss of SAR 14 million in Q1 2023 due to ongoing investment in the CXR program.

Sequentially, the Saudi-listed firm’s profit jumped 53.6% from SAR 227.05 million in Q4 2023, mainly due to higher revenues from the food, retail, and frozen food segments.

Total shareholders' equity, excluding minority interest, reached SAR 8.47 billion as of June 30, 2024, compared to SAR 8.49 billion in the prior-year period.

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