MEPCO’s H1 2020 net profit jumps to SAR 15.6 mln

Middle East Paper Co. (MEPCO) reported a net profit after Zakat and tax of around SAR 15.6 million for the first half of 2020, from SAR 1.8 million a year earlier on higher sales volumes, decrease in the cost of sales per ton, general and administrative expenses, as well as selling and distribution expenses.

The company reported a net profit after Zakat and tax of SAR 11.4 million in Q2 2020, compared to a net loss after Zakat and tax of SAR 4 million, driven by an increase in sales volume and selling prices, decrease in the cost of sales per ton, lower allowance for impairment of trade receivables, finance costs, in addition to an increase in fair value gain on derivative instruments.

On a quarterly basis, Q2 2020 earnings surged 177.4% on higher selling prices, a decrease in general and administrative expenses and lower finance costs. However, the impact was partially offset by an increase in the cost of sales per ton, allowance for impairment of trade receivables, and Zakat expense.