RIYADH: Saudi Arabia’s Almarai, the biggest dairy producer in the Middle East, reported a 16 per cent drop in its fourth-quarter net profit as the company’s costs rose and selling and distribution expenses surged.
Net profit attributable to the company’s shareholders for the period ending 31 December fell to 311.9 million Saudi riyals (Dh305.6m), the company said on Sunday in a statement to Saudi Arabia’s Tadawul stock exchange, where its shares trade. The company’s total comprehensive income for the period more than halved to 277.4m riyals at the end of December from 582.2m riyals reported a year earlier, it said, report agencies.The drop in quarterly net profit came despite a 9.5 per cent rise in revenue, driven mainly by higher sales in the poultry, fresh dairy and food categories. Almarai saw revenue growth in all its business segments except its juice business, which has seen a general decline in the past few quarters, the company noted.
Almarai’s net income was dented by a 19 per cent rise in selling and distribution expenses to 101m riyals “due to higher labour costs, general marketing expenses and trade support to support the sales development”, it said in the bourse filing.
General administration expenses jumped 25 per cent to 25.3m riyals, while its financing cost climbed to 24.8m riyals “mainly due to higher interest rate driven by higher Sibor and lower capitalisation of funding costs for qualified capital projects”, it noted.