Aldrees’ Q2 pressured by expat levy, municipality fees: CEO

Higher general and administrative (G&A) expenses and lower revenue weighed on Aldrees Petroleum and Transport Services Co.’s second-quarter earnings, which declined 0.55 percent year-on-year to SAR 18.2 million, chief executive Abdullah Bin Saad Al-Drees told Argaam.

Profitability was pressured by expat fees of more than SAR 1 million per month imposed from January this year, as well as utilities and municipality fees on fuel stations, which came to around SAR 500,000 paid in full by the company every month. 

Bank interest expenses also jumped by SAR 500,000 per month, Al-Drees said. The Tadawul-listed company’s accounts receivables stood at SAR 488 million, of which 85 percent is owed by state-owned entities, as of June-end.

Meanwhile, Aldrees closed seven fuel stations and launched operations in three others in Q2 2018.

It also opened its first self service station in June.

The company’s fuel consumption increased 1 percent YoY in H1 2018.

Aldrees reported a net profit of SAR 42.8 million for the first half of 2018, a 30.5 percent YoY increase on higher sales of the petroleum and transport divisions.