Shaker Group, a Saudi importer, manufacturer and distributor of air conditioners and home appliances, has announced its financial results for the third quarter of 2018 and the nine-month period ending Sept. 30.
The losses for the third quarter, at both net and operating levels, decreased compared to Q3 2017, as a result of improvements in the group’s gross margin and the delivery of reduced operating costs, showing that initiatives for reducing expenses in line with management’s optimization program are already effective. The general and administrative expenses were reduced by SR1.6 million ($426,600), resulting from lower employee costs. Costs were further reduced by a SR0.7 million decrease in financing expenses as compared with 2017.
On a year-on-year basis, the company was successful in reducing general and administrative expenses by 11.4 percent for the nine months ending Sept. 30, while selling and distribution expenses decreased by 12.8 percent and other expenses decreased by SR14.2 million.
Azzam Saud Almudaiheem, chief executive at Shaker Group, said: “While we continue to face pressure on sales revenues as a result of market challenges including increased competition, a lackluster construction sector and unfavorable seasonality in the third quarter, we are pleased that our efforts to reduce operating expenses and improve efficiencies are delivering results. We are bullish on the positive effect we expect to see from our cost optimization measures, and while we have experienced difficult years in a challenging market, we are addressing these issues head-on to achieve improved performance. We remain confident that the market for air conditioners and home appliances will show long-term promise, which we will actively exploit.”
The net losses for the nine-month period increased compared to the same period in 2017, mainly due to a decrease in sales of 27.2 percent, resulting from sustained market headwinds that include increased competition, muted customer demand, and reduced spending on real estate and construction projects in Saudi Arabia.