Al Othaim makes SAR 321.8 mln profit in 9M 2023, SAR 62.4 mln in Q3

Abdullah Al Othaim Markets Co. posted a 64.6% tumble in net profit to SAR 321.8 million in the first nine months of 2023, compared to SAR 908.7 million in the year-earlier period.

The supermarket chain recorded non-recurring capital gains after Zakat of SAR 96.9 million on the sale of an investment land plot in Riyadh, compared to the non-recurring gains of SAR 701.2 million in the corresponding period of 2022 on selling an investment in an associate and selling land in Madinah.

Al Othaim was also hurt by an increase in selling and marketing expenses driven by new openings, mainly financing cost of lease contracts pursuant to IFRS 16 and the weak performance of the associate companies.

On the other hand, sales grew by 8.26% year-on-year (YoY) from existing and new stores.

The third-quarter net profit slumped 91.8% to SAR 62.4 million from SAR 756.9 million in Q3 2022, which included non-recurring gains of SAR 701.2 million after Zakat on selling an investment in an associate and selling land in Madinah.

Higher selling and marketing expenses on new openings, mainly financing cost of lease contracts pursuant to IFRS 16, and the weak performance of the associate companies also weighed on the three-month earnings.

Meanwhile, sales grew by 4.21% YoY.

Compared to Q2 2023, Al Othaim’s bottom line fell by 55.3% from SAR 139.43 million, as the second-quarter results included SAR 96.9 million non-recurring gains from land sale. The company reported lower profit from cash investment due to dividend payout.

Total shareholders’ equity, after minority interest, decreased to SAR 1.20 billion as of Sept. 30, 2023, from SAR 1.91 billion in the year-earlier period.

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