This is mainly attributed to the following:

- Higher gross profit due to higher sales and margins;

- Higher share of profit from associates;

- Lower net finance cost mainly due to the reduction in currency exchange losses;

- Lower operating expenses; and

- Zakat and tax provision reversal relating to prior years’ assessments for one of the subsidiaries.

The net profit was achieved despite of the higher zakat and income tax expense.

In addition to the net profit performance as explained above, the total comprehensive income recorded for the current quarter compared to total comprehensive loss for the same quarter last year is mainly due to the following:

- Significant decrease in the foreign exchange losses relating to the overseas subsidiaries;

- Decrease in the share of other comprehensive loss relating to “investments in equity accounted investees”; and

- Decrease in loss resulting from the fair value change in the “investments at fair value through other comprehensive income”.

The increase is mainly attributed to the following:

- Significant decrease in the operating cost;

- Increase in the share of profit from associates;

- Decrease in the finance cost mainly due to the reduction in currency exchange losses;

- Zakat and tax provision reversal relating to prior years’ assessments for one of the subsidiaries; and

- Lower zakat and tax expense.

The increase in the net profit recorded is despite of the lower gross profits due to lower sales.

In addition to the net profit performance as explained above, the increase in the total comprehensive income recorded for the 3rd Quarter 2019 compared to total comprehensive income for the 2nd quarter 2019 is mainly due to the decrease in the foreign exchange losses relating to the overseas subsidiaries;

The total comprehensive income achieved is despite of the following:

-Decrease in the share of other comprehensive income relating to “investments in equity accounted investees”; and

- Decrease resulting from the fair value change of the “investments at fair value through other comprehensive income”

The increase is mainly attributed to the following:

- Higher gross profit due to higher sales and margins;

- Lower operating cost; and

- Zakat and tax provision reversal relating to prior years’ assessments for one of the subsidiaries.

These results were recorded despite the following:

-Lower share of profit from an associate;

- Increase in the net finance cost resulting mainly from the adoption of new leasing standard (IFRS 16) applied during 2019, being partially compensated by the reduced foreign currency exchange losses;

- A gain on disposal of investment in the comparable period; and

- Higher zakat and income tax expense.

In addition to the net profit achieved as disclosed above, the total comprehensive income achieved for the period ended 30 September 2019 compared to the total comprehensive loss for the period ended 30 September 2018 is attributed to the following:

-Significant decrease in the foreign currency exchange losses relating to the overseas subsidiaries;

-Decrease in the share of other cmprehensive loss relating to “investments in equity accounted investees”; and

-Increase resulting from the fair value change in the “investments at fair value through Other Comprehensive Income”;

We would like to inform the shareholders and investors that the condensed consolidated interim financial statements of the Group for the third quarter ended September 30, 2019 will be uploaded on Savola website after submitting it to the concerned authorities, and can be accessed through the following link:

http://www.savola.com/SavolaE/Financial_Reports.php