Fawaz Abdulaziz Alhokair Co. (Cenomi Retail) Announces Its Interim Financial Results for the Period Ending on 31 March 2024 (Three Months)
| Element List | Current Quarter | Similar quarter for previous year | %Change | Previous Quarter | % Change |
|---|---|---|---|---|---|
| Sales/Revenue | 1,329.8 | 1,330.8 | -0.075 | 1,011.4 | 31.481 |
| Gross Profit (Loss) | 117.2 | 156 | -24.871 | 89.5 | 30.949 |
| Operational Profit (Loss) | -29 | 28.9 | - | -857.4 | -96.617 |
| Net profit (Loss) | -151.7 | -55.9 | 171.377 | -1,023.7 | -85.181 |
| Total Comprehensive Income | -201 | -73.2 | 174.59 | -1,027.6 | -80.439 |
| All figures are in (Millions) Saudi Arabia, Riyals | |||||
| Element List | Current Period | Similar period for previous year | %Change |
|---|---|---|---|
| Total Share Holders Equity (After Deducting the Minority Equity) | -1,007.4 | 272.8 | - |
| Profit (Loss) per Share | -1.32 | -0.48 | |
| All figures are in (Millions) Saudi Arabia, Riyals | |||
| Element List | Percentage of the capital (%) | Amount | |
|---|---|---|---|
| Profit (Losses) Resulting From The Change In Investment Propertie’s Fair Value | - | - | |
| Accumulated Losses | 135.6 | 1,555.7 | |
| All figures are in (Millions) Saudi Arabia, Riyals | |||
| Element List | Explanation |
|---|---|
| The reason of the increase (decrease) in the sales/ revenues during the current quarter compared to the same quarter of the last year is | Revenues remained stable in Q1-24 at SAR 1,329.8 million. International retail revenues improved from SAR 243.5 million to SAR 269.0 million, growing 10.4%. Retail revenues in Saudi Arabia contracted by 2.0% to SAR 974.5 million due to vacation schedule seasonality during Ramadan, geopolitics, store closures and discounting of seasonal inventorym Franchise exits and store closures led to a 7.1% decline in F&B revenues to SAR 86.5 million. |
| The reason of the increase (decrease) in the net profit during the current quarter compared to the same quarter of the last year is | Cenomi Retail reported a net loss of SAR 151.7 million in Q1-24 (3 months ended 31 March 2024), this compares to a loss of SAR 55.9 million in Q1-23 (3 months ended 31 March2023). This outcome was driven by: • An increase in the cost of revenue This expense increased 3.2% from SAR 1,174.8 million in Q1-23 to SAR 1,212.6 million in Q1-24 , even though there is a decrease in rent expenses , salaries and other expenses such as utilities and maintenance , the cost of sales increased by 7.9% as a resulting impact of the geopolitical effect that impacted ZARA & Inditex sales started from December 2023. • Net finance expenses increased 27.9% to SAR 93.5 million compared to SAR 73.1 million in Q1-23. The finance cost over loans and borrowings increased by 2.78 % but a higher increase in Finance income / (cost) on derivate investment by 596.5 % and Finance costs over lease liabilities 29.16 % impacted the net finance expenses • An increase in losses from discontinued operations losses from discontinued operations tripled to SAR 17.2 million in Q1-24, compared to a SAR 5.6 million loss in Q1-23. This increase was primarily driven by the sale of the 16 brands to Al Othaim Investments, • A decrease in other operating income In Q1-24, other operating income decreased 13.3% to SAR 49.7 million, compared to SAR 57.3 million in Q1-23. • An increase in Zakat and income tax expense. In Q1-24, this expense increased to SAR 11.8 million, compared to SAR 4.4 million in Q1-23. |
| The reason of the increase (decrease) in the sales/ revenues during the current quarter compared to the previous one is | Revenues increased in Q1-24 at SAR 1,329.8 million, this compares to revenues of SAR 1,011.4 million in Q4-23 (3 months ended 31 December 2023) a difference of 31.5 %. Retail revenues in Saudi Arabia increased by 55.0% from SAR 628.8 million to SAR 974.5 million due to Ramadan sales, International retail revenues decreased from SAR 291.8 million to SAR 268.9 million a difference of 7.9%. while sales declined in F&B revenues from SAR 90.8 million to SAR 86.5 million a difference of 4.8% |
| The reason of the increase (decrease) in the net profit (loss) during the current quarter compared to the previous one is | Cenomi Retail reported a net loss of SAR 151.7 million in Q1-24 (3 months ended 31 March 2024), this compares to a loss of SAR 1,023.7 million in Q4-23 (3 months ended 31 December 2023) a difference of 85.2 % . This outcome was driven by: • In Q1-24, compared to the previous quarter despite an increase of sales value from SAR 1,011.4 million to SAR 1,329.8 million by 31.5%, there is an increase in the cost of revenues by 31.5%, which impacted the gross margin reaching to 8.8 %. The operating loss is much lower than in the previous quarter by 96.6% (as the previous quarter witnessed SAR 772 million of one off charges ) and the financial charges increased by 61.0% . |
| Statement of the type of external auditor's report | Unmodified conclusion |
| Comment mentioned in the external auditor’s report, mentioned in any of the following paragraphs (other matter, conservation, notice, disclaimer of opinion, or adverse opinion) | Based on our review, nothing has come to our attention that causes us to believe that the accompanying condensed consolidated interim financial statements are not prepared, in all material respects, in accordance with IAS 34 that is endorsed in the Kingdom of Saudi Arabia.
MATERIAL UNCERTAINITY RELTAED TO GOING CONCERN We draw attention to note (3.2) of the accompanying condensed consolidated interim financial statements, which indicates that the Group incurred a net loss of SR 152 million for the period ended 31 March 2024, and as of that date it recorded accumulated losses of SR 1,556 million. In addition, the Group’s current liabilities exceeded its current assets by SR 3,056 million as of 31 March 2024. These events or conditions, along with other matters as set forth in details in note (3.2) to the accompanying condensed consolidated interim financial statements, indicate that a material uncertainty exists that may cast significant doubt on the Group’s ability to continue as a going concern. Our conclusion is not modified in respect of this matter.
OTHER MATTER As described in note (19) the accompanying condensed consolidated interim financial statements of the group, the condensed consolidated interim statements of profit or loss, comprehensive income, changes in equity and cash flows as of and for the period ended 31 March 2023 have been restated. |
| Reclassification of Comparison Items | Certain comparative figures have been reclassified to conform to the current period’s presentation. |
| Additional Information | Operating highlights During the period, Cenomi Retail opened four stores for fashion and closed 266 stores in KSA, ending with 562 stores, down 38.1% y-o-y. Internationally, they opened eight stores in Jordan and Uzbekistan for fashion and closed 26, totaling 249 stores, down 17.8% y-o-y. The number of brands was reduced by 23% to 57 from 74 in Q1-23. Cenomi Retail's Tier 1 and Champion brands remained strong. In Q1-24, Zara's like-for-like sales value increased by 1.1%, while other Inditex brands decreased by 3.1%, and Cenomi Retail's other brands decreased by 28.4%. In the F&B category, five stores were opened for Subway , Cinnabon and Jumba and eight closed, resulting in a 1.2% y-o-y decrease to 251 F&B stores. Like-for-like sales value for F&B decreased by 10% in Q1-24. Q1 announcements On March 31, 2024, Cenomi Retail announced the Signing of a Variation Agreement to the Share Purchase Agreement dated 15/07/1444H (corresponding to 06/12/2023G) with Abdullah Al-Othaim Fashion Company to Sell the franchise rights for 5 Brands : Aldo & Aldo Accessories , Charles & Keith, Pedro and La Vie En Rose, delivering on transformation promise. On March 31, 2024, Cenomi Retail announced Board's recommendation to decrease the company's capital and board approval of a program to sell non-essential brands. Subsequent announcements On April 18, 2024, Cenomi Retail announced the results of the extraordinary general assembly meeting (the first meeting). On May 07, 2024, Cenomi Retail announced the resignation of a board member. |
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