Savola posts record SR1.4bn profit

The Savola Group has announced a historic and record net income for the 12 months ended Dec. 31, 2012, amounting to SR1.4 billion, an increase of 16.7 percent.
Announcing its interim consolidated financial results for the year ended Dec. 31, 2012, Abdulraouf Mannaa, Savola group managing director, said the group’s gross profit for the fourth quarter ended Dec. 31, 2012, amounted to SR1.41 billion, an increase of 21.6 percent compared to SR 1.16 billion for the same quarter last year and its operating profit for Q4, 2012 amounted to SR792.2 million, an increase of 32.3 percent compared to SR598.9 million for the same quarter last year.
Mannaa also indicated that the increase in net income of the 4th quarter of 2011, which reached SR498.6 million compared to SR413.4 million, a 17 percent increase, is attributed mainly to the capital gain of SR153 million resulting from the sale of two lands during the fourth quarter of 2011 whereas the net profit for the second quarter of 2012 increased by 2 percent compared to the previous quarter of 2012, which amounted to SR405.2 million.
As a result of this record performance, earnings per share for the year 2012 were SR2.80 compared to SR 2.40 for the previous year.
The results also revealed gross profit for the 12 months ended Dec. 31, 2012 amounted to SR4.76 billion, an increase of 19.9 percent compared to SR3.97 billion last year. Operating profits for 2012 amounted to SR2.45 billion, an increase of 36.1 percent compared to SR1.80 billion last year.
The increase in group profits for the full 12 months of 2012 compared to the same period of last year is attributed mainly to the good performance of overseas operations of the foods sector and the continued growth of revenues, which reached SR27.4 billion compared to SR25.2 billion last year, as well as increased market share in the retail sector and capital gain of SR47 million from the sale of Emaar Economic City shares. The increase in group profits for the fourth quarter of 2012 compared to the previous quarter of the same year is attributed to the reasons mentioned above as well as the seasonal impact experienced every year during this quarter.
Mannaa stated that the group has recorded its highest ever net income before capital gains and exceptional items, both for the 4th quarter and the full year. He went on to highlight that the fourth quarter net income of SR413.4 million (before capital gain and exceptional items) is 9.3 percent higher than the announced forecast of SR378 million.
Net income of the group for the year 2012 reached SR1.35 billion, which is 2.3 percent higher than the revised forecast of SR1.32 billion, and 12.5 percent more than the original forecast of SR1.2 billion announced on Tadawul on Jan. 17, 2012, despite challenges in the overseas markets.
In line with its policy of enhancing its disclosures and transparency with its shareholders, investors in the capital market, the group has announced its financial projection for the year ending 2013. In this regard, Mannaa declared that the group is expected to achieve SR1.5 billion (before capital gain and exceptional items) by the end of 2013, and the forecasted net income (before capital gain and exceptional items) for the 1st quarter of 2013 is expected to reach SR260 million.
Savola distributes SR250 million as dividends for its shareholders for the fourth quarter making a total of SR700 million distributed to shareholders in 2012.