Maaden’s second quarter net profit came in at SAR 356 million, lower than Al Rajhi Capital’s estimates of SAR 393 million due to an increase in exploration and other costs.
The company reported SAR 2.99 billion in revenue for the quarter, an increase of 17 percent year-on-year (YoY), as a result of higher sales volumes and improved prices. This is slightly above the brokerage’s estimates of SAR 2.90 billion.
The results also showed 34 percent increase in gross margin, slightly lower than Al Rajhi’s estimates of a 36 percent increase. This is the same as last quarter’s gross margin and higher than Q2 2016 which came at 23 percent.
The broker has revised its rating for Maaden to “underweight”, reducing the target price (TP) to SAR 38/share, but “remain positive on [its] long term growth prospects.”
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