Cenomi Retail reports SAR 71M loss in H1 2024, SAR 81M profit in Q2

Fawaz Abdulaziz Alhokair Co. (Cenomi Retail) logged SAR 71 million in net loss for H1 2024, against SAR 112.3 million in net profit a year earlier.

Cenomi Retail’s Saudi retail revenues decreased by 11% year-on-year (YoY) to SAR 1.82 billion due to the portfolio rationalization program, which saw selling franchises for 19 brands in the Kingdom during the first half.

The company’s profit sank on the impact of the brand exit program and the geopolitical conditions. However, revenues benefited from the recovery period associated with Ramadan, Eid al-Fitr, and Eid al-Adha.

The food and beverage segment recorded a 10% YoY revenue decline to SAR 170 million, with a net closure of one store.

Profit margins continued at strong levels, with gross profit margin reaching 19.5% and EBITDA margin reaching 5.6% in the first half of 2024.

Online sales retreated 6% YoY, by SAR 167 million, with a steady contribution of online revenues to total retail revenues (including food and beverages).

Net financing costs increased by 8% YoY to SAR 170 million, mainly driven by the repayment of debt worth SAR 421 million during 2024.

However, the cost of revenue decreased slightly by 2% YoY to SAR 2.26 billion, despite lower rent, salaries, utilities, and maintenance expenses.

The company reported a 3% YoY drop in selling, general, and administrative expenses to SAR 250 million on lower advertising expenses.

Other operating income increased by 9% YoY in the first half of 2024, reaching SAR 188 million, as a result of the brand exit program, which resulted in capital gains of SAR 165 million.

Zakat and income tax expenses fell in H1 2024 by 46% YoY to SAR 24 million from SAR 17 million in the first half of 2023.

In Q2 2024, Cenomi Retail’s net profit fell 51.5% to SAR 81 million from a net profit of SAR 167.2 million in the prior year period.

Sequentially, it turned into profitability from losses of SAR 151.9 million in Q1 2024.

Shareholders' equity (after excluding minority interest) amounted to SAR 905 million, compared to SAR 519.99 million a year earlier.

Accumulated losses by June 30, 2024 reached SAR 1.47 billion, accounting for 129% of capital.

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