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Halwani Bros Q2 profits plunge 63% due to currency translation

Halwani Bros Q2 profits plunge 63% due to currency translation
Halwani Bros on Wednesday reported a 63.2% year-on-year decline in Q2-17 profits
HB
6001
17.15% 50.90 7.45

Riyadh – Mubasher: Halwani Bros on Wednesday reported a 63.2% year-on-year decline in profits for the second quarter of 2017, according to a bourse filing.

The Saudi-listed company achieved profits of SAR 12.1 million in Q2-17 against SAR 32.9 million in Q2-16.

The firm attributed the decrease in quarterly profits to the subsidiary's sales to the effect of currency translation from Egyptian pound to Saudi riyal on the consolidation of the financial statements, despite the increase in sales of the subsidiary in Egyptian pound and the decrease in domestic sales due to Ramadan and the Eid Al Fitr holiday in the second quarter of this year.

The profits were affected by higher financing expenses of the completion of the construction phase in the industrial complex, which included financing expenses in Q2-16 and an increase in Islamic Murabaha, compared to Q2-16, despite the decrease in general and administrative expenses and sales and distribution expenses due to the effect of currency translation from Egyptian pound to Saudi riyal.

In the first half of 2017, the financial statement of the firm showed a 30.04% plummet in profits to SAR 32.6 million, compared to SAR 46.6 million in H1-16.

Halwani sales dropped 23.1% to SAR 395.7 million in H1-17 against SAR 514.6 million in H1-16, due to currency translation of the subsidiary's sales and lower domestic sales.

On 30 June 2017, the total shareholders’ equity fell 7% to SAR 491.7 million, versus SAR 530.6 million on 31 December 2016.

Net profits soared 48.91% to SAR 20.4 million in Q1-17 from SAR 13.7 million in Q1-16.

By the end of Wednesday’s trading, Halwani Bros’ stock shed 0.42% at SAR 49.6.