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- Asset impairments and restructuring charges related to retail portfolio transformation impact profits
- Focus remains on business transformation, Champion brands and continued retail portfolio optimization
- The Board of Directors has requested Management to evaluate the need for a capital increase should it be required post income from brand sales
- Cenomi Retail’s operational cash flow remains strong with no impact on day-to-day business operations including commitments to brand partners, landlords and financial institutions.
Riyadh, Saudi Arabia: Cenomi Retail, Saudi Arabia’s pioneering retail brand partner, today announced its financial results for the quarter and full-year ended 31 December 2023.
During 2023, significant progress has been made on the retail portfolio optimization across Saudi Arabia and International markets. As a result of this optimization, 16 brands were sold, and a number of International markets were either exited or right sized.
The sale of 16 brands, which was finalized in Q1 2024, resulted in 226 stores in Saudi Arabia transferring to Abdullah Al Othaim Fashion Company. The International market exiting, and right sizing resulted in a net closure of an additional 219 stores in 2023. A subsequent Board approval has been given for the sale of an additional five brands: Aldo, Aldo Accessories, Pedro, La Vie en Rose and Charles & Keith and an amended agreement was signed with Abdullah Al Othaim Fashion Company.. The impact, which will be reported during the 2024 fiscal year will result in 121 stores transferring for an agreed consideration of SAR 219 million plus inventory.
2023 saw the continuation of Cenomi Retail’s turnaround strategy which is focused on building Champion brands in Fashion, led by Inditex as well as top tier Food & Beverage brands. In International markets 2023, Zara and other Inditex brands performed strongly: on a like-for-like basis, Zara sales grew 14.7% while other Inditex brands grew 17.3%. This performance offset softness in Saudi Arabia where Zara like-for-like sales were flat (-0.2%) while other Inditex brands declined 6%. A strong performance was seen across market leader Subway where revenues grew 20-fold thanks to improving revenues per outlet and store expansion.
