Herfy profit slumps 78% to SAR 32.3 mln in 9M 2020 on lower sales

Herfy Food Services Co. reported a net profit after Zakat and tax of SAR 32.2 million for the first nine months of 2020, a plunge of 78% year-on-year (YoY), hurt by a 19% sales drop YoY amid the precautionary measures adopted by the Kingdom.

In addition, Herfy recorded higher general and administration expenses and allocated provisions for slow moving inventory and doubtful debts of SAR 16.4 million and SAR 12.4 million, respectively for the same period.

The third-quarter net profit after Zakat and tax also fell by 28% YoY to SAR 41.4 million, due to an 8% YoY decline in sales on the lockdown measures in the Kingdom.

Herfy also cited increased provisions for slow moving inventory and doubtful debts to SAR 8.4 million and SAR 6.5 million, respectively.

When compared to the previous quarter, the company turned profit from a net loss of SAR 34.2 million, thanks to an 83% surge in sales. In addition, the previous quarter sales were negatively impacted by the precautionary measured taken by government to contain COVID-19 pandemic.

Shareholders’ equity, excluding minority interest, stood at SAR 956.51 million by the end of September 2020, rising 1% from SAR 948.68 million a year earlier.