Budget Saudi eyes expansions, new investments in 2022: CEO

Fawaz Danish, President and Group CEO of Budget Saudi

United International Transportation Co. (Budget Saudi) is looking forward to expanding its operations and enter into new investments in the logistics services sector this year, President and Group Chief Executive Officer (CEO) Fawaz Danish, told Argaam in a telephone interview.

The 2021 dividend payout at SAR 1.9 per share was “solid”, implying the company’s robust balance sheet and strong cash flows, as there is no debt. The board of directors partially retained cash liquidity for new expansions, after the resumption of Umrah and Hajj season 2022.

Budget Saudi’s short- and long-term car rentals have significantly improved since early October 2021, Danish said, expecting the month of Ramadan to see higher demand for domestic rentals.

Replying to a question about a decline in Q4 2021 net profit, the CEO said the company’s net profit was hit by the sales of used cars in 2021, as it has a large number of unutilized cars, which were sold in the fourth quarter of 2020 when Budget Saudi made an exceptional profit.

Danish explained that governmental and quasi-governmental entities depend on car rentals rather than purchases under long-term contracts of up to four years, and short-term contracts for car rentals at airports and within cities. Government contracts is a decimal part of the company’s business, which witnesses accelerated growth.

Budget Saudi’s market share was steady at 25%. The company is upgrading its technical services to meet client demand, as it currently provides car delivery services to customers.

Budget Saudi reported a net profit after Zakat and tax of SAR 219.9 million for 2021, a rise of 9%, compared with SAR 202.5 million a year earlier. The fourth-quarter net earnings reached SAR 51.7 million, falling 45% from SAR 93.9 million in the year-earlier period.