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Red Sea International Co. announces the interim financial results for the period ending on 31-03-2018 (Three Months)

RED SEA 4230 36.12% 27.85 7.39
Element Current quarter Similar quarter for previous year % Change current Previous quarter % Change previous
Net profit (loss) -15.4 8.7 - -55.8 72.4
Gross profit (loss) 13.7 45.3 -69.76 -23.1 -
Operational profit (loss) -11.5 15.5 - -51.8 77.8
Earning or loss per share, Riyals -0.3 0.1 - - -
All figures are in (Millions) Saudi Arabia, Riyals
Element EXPLAINATION
Reasons of increase (decrease) for quarter compared with same quarter last year There was a Net loss attributable to Shareholders of the Company for the current quarter as compared to Net profit for the same quarter last year, with decrease in gross profit by SAR 31.6 million arising from reduction in gross profit margin from 19.9% in the same quarter last year to 9.3% in current quarter and also drop in building revenues by 45.0% , in rental revenues by 23.3% , and in paint business revenues by 15.5% in comparison to same quarter last year. Furthermore, IFRS-15 implementation had an impact on the timing of revenue recognition with SR 38.8 million of revenue booking being deferred to Q2'2018, with corresponding gross margin of SR 10.6 million also moving into Q2'2018, Q1 2018 consolidated revenues prior to giving effect to IFRS-15 showed Revenues of SR 186.5 million with a net loss of SR 4.8 million. However, Company has implemented cost control measures and has reduced its selling & marketing expenses by 25.5%, General and Administrative expenses by 3.9% as compared to same quarter last year.
Reasons of increase (decrease) for quarter compared with previous quarter There was a decrease in Net loss attributable to Shareholders of the Company for the current quarter as compared previous quarter, with increase in gross profit by SAR 36.8 million arising from increase in gross profit margin from (14.4%) in the previous quarter to 9.3% in current quarter, however there was drop in building revenues by 9.2%, in rental revenues by 12.3% in comparison to previous quarter. Furthermore, IFRS-15 implementation had an impact on the timing of revenue recognition with SR 38.8 million of revenue booking being deferred to Q2'2018, with corresponding margin of SR 10.6 million also moving into Q2'2018, Q1 2018 consolidated revenues prior to giving effect to IFRS-15 showed Revenues of SR 186.5 million with a net loss of SR 4.8 million. However, Company has implemented cost control measures and has reduced its selling & marketing expenses by 21.6%, however General and Administrative expenses were marginally increased by 4.9% as compared to previous quarter.
Other notes The sales revenue for the current quarter ended March 31, 2018 is SAR 147.7 million as compared to SAR 227.3 million during the same quarter last year, which represents a decrease of 35.0%. Compared to sales revenues of SAR 160.8 million during the previous quarter, there was a decrease of 8.1%.

The Comprehensive loss attributable to Shareholders of the Company for the current quarter is SAR (15.5) million as compared to as comprehensive income of SAR 6.9 million for the same quarter last year, a decrease in income by 324.6%. Also compared to comprehensive loss of SAR (59.7) million for the previous quarter, there was a decrease in loss by 74.0%.

The Net Shareholders' Equity (excluding minority interest) at the end of current quarter is SAR 789.0 million as compared to SAR 942.8 million at the end of same quarter last year, a decrease of 16.3%. Also compared to Net shareholders' Equity of SAR 817.3 million at the end of previous quarter, there was a decrease of 3.5%.

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