Arabian Centres profit slips 34% to SAR 359.7 mln in 9M FY2020/21
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Arabian Centres Co. (ACC) reported a net profit after Zakat and tax of SAR 359.7 million for the first nine months ended Dec. 31, 2020, down by 34%, as compared to SAR 545.8 million in the same period in 2019.
The company attributed the profit decline to 16.5% drop in revenues, driven primarily by the restriction of activity at shopping centers in Q1 FY2020/21 as a result of COVID-19 and government efforts to contain the spread.
Financials (M)
| Item | 9m 2019 | 9m 2020 | Change |
|---|---|---|---|
| Revenues | 1,689.17 | 1,410.11 | (16.5 %) |
| Gross Income | 1,120.83 | 802.37 | (28.4 %) |
| Operating Income | 979.94 | 546.00 | (44.3 %) |
| Net Income | 535.95 | 357.21 | (33.3 %) |
| Average Shares | 475.00 | 475.00 | - |
| EPS (Riyals) | 1.13 | 0.75 | (33.3 %) |
Revenues were further impacted by the extension of special, non-recurring discounts to help address the impact of COVID-19 on ACC’s tenants.
The company further cited lower gross profit; higher other income, expenses for advertisement and promotion, and interest expense on lease liabilities; and 87.4% rise in impairment loss on accounts receivable, for the profit drop.
Current Quarter Comparison (M)
| Item | Q3 2019 | Q3 2020 | Change |
|---|---|---|---|
| Revenues | 557.54 | 469.41 | (15.8 %) |
| Gross Income | 361.73 | 248.94 | (31.2 %) |
| Operating Income | 314.60 | 152.81 | (51.4 %) |
| Net Income | 107.89 | 95.42 | (11.6 %) |
| Average Shares | 475.00 | 475.00 | - |
| EPS (Riyals) | 0.23 | 0.20 | (11.6 %) |
In Q4 2020/21, net profit after Zakat and tax decreased by 14% year-on-year (YoY) to SAR 95.6 million on 15.8% decline in revenues. Lower gross profit and finance cost, and higher general and administrative expenses also weighed on the fourth-quarter results.
On a sequential basis, net profit decreased by 13.9%.
Financial results (Million)
| Period | Revenues | Change | Gross Income | Change | Operating Income | Change |
|---|---|---|---|---|---|---|
| Q1 2020 | 475.85 | (16.9 %) | 298.65 | (24.0 %) | 230.77 | (32.8 %) |
| Q2 2020 | 464.84 | (16.9 %) | 254.77 | (30.5 %) | 162.43 | (49.6 %) |
| Q3 2020 | 469.41 | (15.8 %) | 248.94 | (31.2 %) | 152.81 | (51.4 %) |
Profit Performance (Million)
| Period | Net Income | Change | EPS(Riyal) | Extraordinary Income/Expense | Net Profit Before Unusual Items | EPS Before XO Items |
|---|---|---|---|---|---|---|
| Q1 2020 | 152.76 | (31.5 %) | 0.32 | 35.30 | 117.46 | 0.25 |
| Q2 2020 | 109.03 | (46.8 %) | 0.23 | 37.65 | 71.37 | 0.15 |
| Q3 2020 | 95.42 | (11.6 %) | 0.20 | 46.52 | 48.91 | 0.10 |
Profitability
| Period | Gross Margin | OIBDA Margin | Net Margin Before Unusual Items |
|---|---|---|---|
| Q1 2020 | 63.99 % | 77.11 % | 25.15 % |
| Q2 2020 | 61.44 % | 77.77 % | 19.67 % |
| Q3 2020 | 58.38 % | 75.67 % | 17.50 % |
Per Share Data (Riyal)
| Period | Shares Outstanding (M) | EPS (Riyal) | Adjusted EPS (Riyal) | Book Value (BV) |
|---|---|---|---|---|
| Q1 2020 | 475.00 | 1.19 | 1.11 | 12.97 |
| Q2 2020 | 475.00 | 0.98 | 0.83 | 12.78 |
| Q3 2020 | 475.00 | 0.96 | 0.71 | 12.46 |
Multiple Ratios (End of Period Price)
| Period | P/E | Adjusted P/E | Price/book |
|---|---|---|---|
| Q1 2020 | 17.78 | 18.97 | 1.63 |
| Q2 2020 | 22.53 | 26.69 | 1.74 |
| Q3 2020 | 27.76 | 37.63 | 2.13 |
Business Segments (Million)
Q3 2020
| Period | Rental income | Service and management fee income | Turnover rent | Commission income on provisions for utilities, net |
|---|---|---|---|---|
| Q1 2020 | 449.91 | 21.63 | 3.88 | 0.43 |
| Q2 2020 | 435.40 | 23.15 | 5.45 | 0.85 |
| Q3 2020 | 444.97 | 21.69 | 1.85 | 0.89 |
| Current | |
| Market Cap (M Riyal) | 9,395.50 |
| Enterprise Value (EV) (M) | 20,012.08 |
| Shares Outstanding ((M)) | 475.00 |
| EPS ( Riyal) (TTM) | 2.89 |
| Book Value (BV) ( Riyal) | 30.75 |
| Par Value ( Riyal) | 10.00 |
| Adjusted P/E (Last12) | 13.38 |
| P/E (TTM) | 6.85 |
| Price/book | 0.64 |
| Return on Average Assets (%) (TTM) | 4.8 |
| Return on Average Equity (%) (TTM) | 9.7 |
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