Bindawood Holding, one of Saudi Arabia's biggest grocery retailers, reported a "tough start" to 2021 as net profit fell 51 per cent in the first quarter on lower sales.
The company reported net profit of 62.1 million riyals ($16.5m), compared with 126.3m riyals in the same period last year. Revenue fell 20 per cent 1.12 billion riyals.
“It has been a tough start to the year as the local Saudi grocery retail market continues to remain subdued," Ahmad BinDawood, chief executive of BinDawood Holding, said. "It is heartening to see some green shoots of recovery but overall, we see a return to pre-Covid sales only in the second half of 2021."
Bindawood Holding operates 74 stores across the kingdom – 51 of which are hypermarkets and 23 supermarkets – under the Bindawood and Danube brands. The company said revenue was stronger in the corresponding quarter last year as there was a one-off gain from people stocking up in March ahead of anticipated lockdowns. Moreover, its stores in Makkah and Madinah were fully operational for the entire first quarter of last year but had some pandemic restrictions in place this year.
An easing of restrictions, the gradual return of pilgrims to the kingdom's two holy cities and forthcoming promotions and festivals are all things that make the company "cautiously optimistic" about stronger sales and profit in the second half, Mr BinDawood said.
“Furthermore, we are excited to announce we will be bringing our eponymous BinDawood brand to the Riyadh Province. We plan to open 10 BinDawood stores across the province between 2022 and 2027 and to increase that number in line with market demand. As a recently listed company, we are very proud to announce this investment in the Riyadh Province, which will not only increase our physical footprint across the kingdom but will also result in more employment opportunities for Saudi nationals in the supermarket sector."
BinDawood made its debut on the Saudi stock exchange, Tadawul, in October last year.
The company is also planning to grow internationally, with Bahrain already targeted as a location for expansion.
