RIYADH: BinDawood Holding Company, a leading grocery retail operator of hypermarkets and supermarkets in the Kingdom, announced a net profit decrease of 41.7 percent in the first nine months of 2021 on higher costs and fall in sales due to seasonality.
The group reported a SR227.34 million ($60.6 million) profit compared to SR390.32 million in the same period of 2020, it said in a filing.
Net profit margin fell from 9.7 percent in nine months in 2020 to 6.8 percent this year due to a greater impact of fixed costs due to a decline in revenue, the company said in a bourse filing.
Net profit also dropped in the third quarter of 2021, by 10.6 percent year-on-year, reaching SR70.24 million.
The company attributed this decrease to the increase in operating expenses by 11.7 percent.
The company is currently working on opening two new supermarkets of their ‘Danube’ brand stores to start operations before the end of the year, said Ahmad BinDawood, CEO, BinDawood Holding.
Bin Dawood explained in a company statement that this matter will expand the company's presence to meet the requirements of consumers, as well as enhance its readiness for 2022, Argaam reported.
Commenting on the company's financial results, he said revenues during the third quarter were somewhat similar to revenues of the same period during the year 2020, but they are still lower than those recorded during the previous quarter, as this was due to the return of large numbers of consumers to their countries after easing travel restrictions.
He added the gross profit margin reaching good levels at 36.9 percent indicates the success of the operational strategy implemented by the management team, which partially compensated for the decrease in sales, Argaam reported.
Third quarter operating expenses were SR304.1 million compared to SR272.2 million in Q3 2020 as a result of the termination of Covid-related government waivers for businesses and additional employment costs arising from changes in the management team, it said in a statement.
