Savola has reported a fall in annual sales and earnings from its food division amid an impairment on the Saudi Arabia-based group’s food manufacturing business in Egypt.
The company generated revenue of SAR11.8bn (US$3.15bn) from its Savola Foods business, down from the SAR13.1bn it reported for 2015.
The division made a net profit of SAR14m. In 2015, the net profit from Savola Foods was SAR687m.
The unit’s adjusted net profit, which saw Savola exclude impairment charges and before accounting for foreign exchange losses, was SAR 568 million as compared to a net profit of SAR678m in 2015.
Savola booked an impairment of assets and goodwill related to the Egypt operations of Savola Foods of SAR302m gross.
The company said the volumes from its Savola Foods business “demonstrated stability” at four million metric tonnes sold. “The strength of the group’s brand was demonstrated in improved pricing and sales within premium segments, offsetting some of the foreign exchange losses.”
On a group-wide basis, which also excludes Savola’s retail operations – the company is the owner of Saudi grocery retailer Panda – the business reported a net loss of SAR451m for 2016, compared to a net income of SAR1.79bn in 2015.
Savola’s group revenue stood at SAR25bn, against SAR25.1bn a year earlier.
The group figures included a charge of SAR377m gross for an inventory reduction within Savola’s retail business. The company also pointed to the fact it recorded a capital gain of SAR265m on the disposal of Savola Packaging Systems Co. in 2015.