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Al Hassan Ghazi Ibrahim Shaker Co. announces its Annual Financial Results for the Period Ending on 2021-12-31

Element ListCurrent YearPrevious Year%Change
Sales/Revenue 1,086,445932,69916.483
Gross Profit (Loss) 235,522195,56020.434
Operational Profit (Loss) 37,24712,091208.055
Net Profit (Loss) after Zakat and Tax 27,9568,023248.448
Total Comprehensive Income 28,1316,470334.791
Total Share Holders Equity (after Deducting Minority Equity) 622,935595,3814.627
Profit (Loss) per Share 0.440.12
All figures are in (Thousands) Saudi Arabia, Riyals
Element ListExplanation
The reason of the increase (decrease) in the net profit during the current year compared to the last year is Al Hassan Ghazi Ibrahim Shaker Co. (“Shaker”) achieved a net profit of SAR 28 million for the full year 2021, a 248.4% increase from SAR 8 million in 2020, as a result of the following:

Revenues

The company’s revenues recorded SAR 1.1 billion in 2021, a 16.5% year on year (y/y) growth from SAR 933 million a year earlier. The increase in the company’s revenue was mainly driven by the company’s enhanced sales strategy which contributed to maximizing sales outcomes across all core segments including Home Appliances and ACs as well as the B2B and ESCO segments.

Gross Profit

Gross profit increased by 20.4% y/y in 2021, reaching SAR 235.5 million from SAR 195.6 million a year earlier, mainly driven by the increase in revenues.

Net Profit

The company delivered a significant 248.4% increase in net profit, recording SAR 28 million in 2021, compared to SAR 8 million the previous year. This reflects the substantial rise in revenues and operating profit, resulting from the continued brand and product portfolio expansion and enhanced distribution channels.

Share in profit from associates slightly decreased by 4.5% or the equivalent of SAR 1.1 million.

Statement of the type of external auditor's report Unmodified opinion
Reclassification of Comparison Items The comparative figures of the Condensed Consolidated Interim Financial Statements have been reclassified to meet the current year classification according to the International Financial Reporting Standards (IFRS) that are endorsed in the Kingdom of Saudi Arabia.
Additional Information Certain amounts in the comparative periods have been corrected and, accordingly, restated in the statement of financial position as at December 31, 2020 and 1 January 2020, and in the statements of profit or loss and other comprehensive income for the prior periods as explained below.

a) The unrealized profit on upstream transactions between the Company and its associate were not eliminated in prior years. Therefore, the investment in associate and share of profit from the associate balances have been corrected retrospectively.

b) Included within trade receivables was a receivable balance amounting to SAR 28.64 million in relation to advisory services offered by one of the company’s subsidiaries. Based on the memorandum of understanding between the subsidiary and its customer, the fees were contingent in nature. Further, the probability of realizability of these fees was low and did not meet the recognition criteria. Therefore, the revenue and the related receivable balance should not have been recognized in the previous financial years.

c) The presentation of the statement of financial position is changed retrospectively for better understanding and presentation by segregating prepayments and other debt balances from trade and other receivables. The effects are the reclassification of SAR 4.2 million as at December 31, 2020 (January 1, 2020: SAR 3.5 million) from trade receivables and other receivables to prepayments and other debt balances.

The total cashflows from operating, investing, and financing activities were not affected because of these restatements. The effects of the restatements in the statement of cash flows are primarily in adjustments for non-cash items and changes in working capital within cash flows from operating activities and hence, are not disclosed separately.

The company achieved revenue of SAR 1,086 million, growing by 16.5% as compared to FY 2020. Gross profit increased 20.4% year on year to SAR 236 million. The company’s FY 2021 net profit significantly increased to SAR 28 million up from SAR 8 million in FY 2020.

The accumulated losses to capital ratio decreased from 27.9% in 2020

to 23.5% in 2021 following the re-statement of financials of the previous year. In this instance, the CMA’s rules and regulations for listed companies with total accumulated losses of 20% or more of capital will be applied.

Earnings / (Loss) calculation per Share for FY21:

(All figures are in (Thousands) Saudi Arabia Riyals)

Profit for the FY 2021: SAR 27,956

Less Non-Controlling interests: SAR 533

Profit attributable to owners of the company (A): SAR 27,423

Number of shares (B): 63,000

Profit per share (calculated (A) divided by (B)): SAR 0.44

Earnings / (Loss) calculation per Share for FY20 (restated):

(All figures are in (Thousands) Saudi Arabia Riyals)

Profit for the FY 2020: SAR 8,023

Less Non-Controlling interests: SAR 597

Profit attributable to owners of the company (A): SAR 7,426

Number of shares (B): 63,000

Profit per share (calculated (A) divided by (B)): SAR 0.12

Outlook and strategy

The successful execution of the company’s new growth strategy that will take the business through to 2023 has prioritized the diversification of the brand portfolio and positioning the business to become the preferred choice for partners and customers in the Saudi consumer electronics and home appliances sector, while continuing to maintain its market leadership in the Saudi AC market.

The Company sees significant growth opportunities stemming from the Saudi economic recovery, the execution of mega projects in line with Vision 2030 and real estate initiatives which will help grow its market share and cement its position as the Saudi AC market leader. Mega projects, including Neom, Amaala and Red Sea Development, remain a steady and important source of opportunities for Shaker’s AC business in tandem with energy efficiency programs by the government, including Saudi Energy Efficiency Center’s (“SEEC”) high-efficiency AC initiative, and Tarsheed, the Saudi government’s National Energy Services Company.

Improving market share across the segments in which the company operates remains a priority for the management team. In 2021, The company has succeeded in growing market share in the Home Appliance segment while steadily growing the AC segment. Business segment sales teams continue to regularly exceed monthly sales targets against forecasts, demonstrating healthy and sustained market demand for the company’s products and services.

The Company remains agile in its approach towards brand acquisitions, seeking first to complement the strong line-up of brands already on offer. Consumer demand for energy efficient Home Appliances continues to increase as the market recovers and retail stores re-open, along with the recovery of consumer purchasing power.

The Company fosters strong relationships with key global brands and new commercial partnerships and alliances are explored continuously to further expand its home appliances offering in the Kingdom to meet the growing customer demand.

Attached Documents  

The Capital Market Authority and Saudi Exchange take no responsibility for the contents of this disclosure, make no representations as to its accuracy or completeness, and expressly disclaim any liability whatsoever for any loss arising from, or incurred in reliance upon, any part of this disclosure, and the issuer accepts full responsibility for the accuracy of the information contained in it and confirms, having made all reasonable enquiries, that to the best of their knowledge and belief, there are no other facts or information the omission of which would make the disclosure misleading, incomplete or inaccurate.

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