Saudi Land Transport Co. (Mubarrad) is expected to generate a positive operational income following its acquisition of Arabian Security Safety Services Co. Ltd. (Amenco), according to analysis conducted by Argaam Research.
However, no financial impact is projected for Mubarrad’s balance sheet as the deal was financed by the company’s internal resources. Therefore, total assets and shareholder equity will see no change.
Mubarrad announced in a bourse statement on Sunday its plans to acquire a 95 percent stake in Amenco for SAR 180.3 million.
In 2014, Amenco generated SAR 400 million in revenue, with a profit of SAR 33 million, according to data available on Argaam. However, the company did not mention whether the SAR 33 million profit is operational or one-off gains.
Based on Mubarrad’s normalized figures, the stock currently trades at a price/earnings ratio (P/E) of 48 times before extraordinary gains and at 14.7 times after factoring in these gains.
|
Mubarrad Pro-Forma 2014 (SAR mln) |
|||
|
Change |
After Acquisition |
Before Acquisition |
Item |
|
+699% |
457.24 |
57.24 |
*Gross revenue |
|
-- |
N/A |
6.49 |
*Gross profit |
|
-- |
N/A |
(11.42) |
Expenses |
|
-- |
N/A |
(4.93) |
Operational income |
|
+374% |
22.97 |
(8.38) |
**Net profit before unusual items |
|
+374% |
1.28 |
(0.47) |
EPS before extraordinary items (SAR/share) |
|
-- |
52.39 |
52.39 |
Extraordinary items |
|
+71% |
75.36 |
44.01 |
Net profit after extraordinary items |
|
+71% |
4.19 |
2.44 |
EPS after extraordinary items (SAR/share) |
**Excluding minority interests from net profit
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