eXtra Registers a 95.4% Increase in Profits in Third Quarter at SAR 53.2 Million
The net profit of the United Electronics Company (eXtra) jumped to SAR 53.2 million in the third quarter after taxes and zakat, compared to SAR 27.2 million during the same period last year, registering a 95.4% increase.
This follows today’s announcement of the preliminary financial results for the nine-month period ending on 30 September 2020.
Operating profits reached SAR 65 million in the third quarter compared to SAR 38 million during the same period last year, registering a 72% increase, while total profits reached SAR 225.3 million in the third quarter compared to SAR 186 million during the same period last year, registering a 21% increase.
Meanwhile, net profits after zakat and tax reached SAR 178.5 million compared to SAR 133.5 million during the same period last year, registering a 34% increase.
In addition, the earnings per share in the current period reached SAR 2.98 compared to SAR 2.23 during the same period last year.
The increase in net profits during the current quarter compared to the same quarter last year (SAR 53.2 million compared to SAR 27.2 million with a 95.3% increase) is due to an 18.3% increase in sales compared to the same quarter last year. This was due to an increase in sales in all divisions as well as an increase in the revenues of eXtra services and consumer finance services, which resulted in a 21.3% increase in total profits; reaching SAR 225.3 million compared to SAR 185.7 million during the same quarter last year. It is worth noting that net profits reached SAR 6 million for the third quarter of this year compared to losses estimated at SAR 5.6 million in the same quarter last year.
The increase in net profits this quarter compared to the previous quarter (SAR 53.2 million compared to SAR 90.4 million) is a result of a 21% decrease in sales due to the issuance of regulations increasing value-added tax in the second quarter. This led to an increase in the demand for products before the tax was applied, in addition to seasonal changes in sales, which had an impact on the decrease in gross and net profits.
The increase in net profits during this period compared to the same period last year (SAR 178.5 million compared to SAR 133.5 million) was due to a 23.1% increase in sales compared to the same period last year. This was due to an increase in sales in all the company’s divisions as well as an increase in the revenues of eXtra services and consumer financing services, which increased the company’s total profits by 20.3% to register SAR 722.2 million in total profits compared to SAR 600.1 million in the same period last year, leading to a 33.6% increase in net profits despite the increase in sales and operating expenses compared to the same period last year.
The net profits of eXtra amounted to SAR 6.2 million compared to losses estimated at SAR 15.7 million for the same period last year.
Audit opinion: unmodified.
The company stated that these estimated financial results for the period ending on 30 September 2020 were prepared by the company’s management and have not been examined or reviewed by its external auditor.
Some operating expenses decreased in the third quarter due to several support initiatives provided by the government of the Custodian of the Two Holy Mosques to mitigate the effects of the coronavirus pandemic.
The earnings per share were amended after the company’s capital increased, which was approved by the company’s extraordinary general assembly held on 5 May 2020.
