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- Gross profit of SAR 179.8 million, a 21.7% increase compared to Q3FY23
- Adjusted EBITDA rose 29.5% to SAR 210.2 million, recovering from the Red Sea crisis
Jeddah, Saudi Arabia: Sustainable Infrastructure Holding Company ("SISCO", "TADAWUL: 2190"), Saudi Arabia's leading strategic investor in Ports & Logistics and Water Solutions has announced its financial results for the quarter ended 30 September 2024.
Revenues for the third quarter of 2024, excluding accounting construction revenue, grew by 23.8% compared to Q3FY23 to reach SAR 341.8 million, after another strong performance from the Ports segment. On a quarter-to-quarter basis, revenues grew by 13.0% compared to Q2FY24, primarily driven by the Ports and Logistics segments. Year-to-date revenues increased by 16.2% to SAR 901.9 million, driven by a strong performance across all segments.
The third quarter gross profit of SAR 179.8 million represents a growth of 14.7% on a quarter-to-quarter basis, and 21.7% compared to Q3FY23. The gross profit margin for Q3FY24 was down 0.9% year-on-year, due to increased depreciation and direct costs, but was up 0.8% quarter-on-quarter, which is broadly in line with expectations. Year-to-date saw gross profits increase by 13.8% to SAR 469.5 million.
Adjusted EBITDA growth is also strong, rising by 29.5% to SAR 210.2 million compared to Q3FY23, placing SISCO in line to reach strategic goals. Adjusted EBITDA growth quarter-on-quarter was 20.8%, with a year-to-date increase of 17.7% to SAR 543.8 million.
The company reported a loss of SAR 20.1 million year-to-date, impacted by an exceptional net loss of SAR 59.2 million (SISCO Holding share of loss is SAR 29.6 million) in Tawzea, an equity accounted associate, due to a one-off provision for additional costs in three EPC (engineering, procurement and construction) projects of SAR 68 million during Q1 2024 and RSPDI pre-operating expenses of SAR 11 million.
The adjusted net income for the third quarter was reported at SAR 23.6 million. Compared to the same quarter last year, adjusted net income declined by SAR 0.1 million, representing a 0.6% decrease, as a result of depreciation and increased finance charges. The year-to-date adjusted net income also decreased by 19.6%, from SAR 65.6 million to SAR 52.7 million, again due to rising finance charges and operating expenses. However, adjusted net income, quarter-on-quarter rose by 62.1% to SAR 23.6 million, largely due to increased revenues from ports and terminals.
SISCO reports an impressive recovery, especially in the Red Sea Gateway Terminal, from subdued Q3FY23 results in the Port segment due to the Red Sea situation. Port volume reached SAR 828,868 TEUs in Q3FY24, returning to the similar levels seen in Q4FY23.
Q3FY24 Quarterly Performance Highlights:
- Revenues improved by 13.0% on a quarterly basis and 23.8% compared for Q3FY23. This growth was mainly driven by improvements in the ports & terminals segment.
- Gross profit rose by 14.7% compared to Q2FY24, and 21.7% compared to the same period last year, primarily driven by an increase in revenue and margins in ports and terminals segment.
- Adjusted EBITDA rose to SAR 210.2 million marking a 29.5% increase from the same quarter in 2023, with an improved margin of 61.5%.
- Adjusted net income of SAR 23.6 million compared to SAR 14.5 million in Q2FY24, even when accounting for the one-off payment of SAR 25 million for Zakat.
Commenting on the results: Eng. Khalid Suleimani, Group CEO, SISCO said:
“I am pleased to report that SISCO has continued to demonstrate strong growth and operational performance in Q3FY24, with revenues improving by 23.8% compared to Q3FY23. Our Ports segment, which remains a key driver of growth, saw a significant increase in gateway volumes and profitability, leading to robust results despite the challenges in the region.
Net income remains strong, despite the one-off provision of SAR 25 million to Zakat. Another highlight of the quarter is the impressive recovery in the Red Sea Gateway Terminal, highlighting the resilience of our business.
We are also excited to announce the Multi-Purpose Terminals (MPT) concession, which will allow us to expand operations across all non-containerised port facilities in the Red Sea Gateway Terminal. This strategic initiative positions SISCO to capture further growth opportunities both domestically and internationally.
Looking ahead, we remain committed to executing our five-year strategy to double revenues by 2026 and continue delivering long-term value to our shareholders.”
Outlook and (26X6) Strategy
During the quarter, we have continued to focus on SISCO’s five-year-strategy (6x26), aiming to drive long-term value creation for its shareholders and double revenues to SAR two billion by 2026.
Our Ports and Logistics segment is well positioned to take advantage of the positive trend in local imports, driven by our strategic capacity expansion initiatives. In addition, our portfolio companies have also reported strong performances and demonstrated their growth potential, evidenced by notable contracts within the Kingdom.
Recently, we have established MPT a Multi-Purpose Terminals (MPT) business unit which will assume operations of all non-containerised port facilities within the expanding RSGT portfolio, as well as target growth in international non-containerised markets.
During the quarter, Tawzea signed a contract with MODON to operate and market drinking water services in key Saudi industrial cities. This development represents a significant milestone for Tawzea. It enhances projected diversity, boosts market share, expands its global partnerships, and strengthens Tawzea’s presence within Neom. In addition, Kindasa has extended the lease for the desalination station site in Jeddah Islamic Port until 2041 which aligns with our strategic goal to undertake long-term BOOT (build own operate transfer) contracts in Saudi Arabia and worldwide.
Our M&A efforts are strong, and we have a healthy pipeline of transactions in the works. Our team is working hard to develop these capabilities and seize the strategic opportunities that allow us to make substantial progress towards our five-year strategy objectives.
Income Statement Summary
|
| Adjusted Revenue | Gross Profit | EBITDA-Adjusted | Net Income – Adjusted |
| Q3-2024 | SAR 341.8 m 23.8% | SAR 179.8 m 21.7% | SAR 210.2m 29.5% | SAR 23.6 m |
Operational Highlights
Ports & Terminals
The revenues for Ports in Q3FY24 showcased a strong performance, reporting an increase of 27.5% from the same quarter last year. Most notably, operating profit saw a substantial rise of 37.1%, hitting SAR 119.3 million, driven by improved margins due to strong gateway volumes, which rose by 26% compared to Q3FY23. Year to date revenues increased by 18.1% from SAR 624.8 million to SAR 737.7 million.
Logistics, Parks & Services
The Logistics segment revenues for Q3FY24 increased by 1.4% compared to the same quarter in 2023, reported at SAR 32.6 million. Gross profit was reported at SAR 9.5 million, a 39.5% decrease compared to 2023.
Investment in warehouse expansion, which was completed in 2023, has paid off, resulting in a notable 23.5% increase in warehouse revenue to SAR 11.9 million in the current quarter compared to Q3FY23. Additionally, land revenue was reported at SAR 5.2 million, a 33.4% decrease compared to last year. Service revenue has also seen an increase of 5.2% year-on-year, reaching SAR 15.5 million in Q3FY24.
SISCO Holding’s share of SA Talke’s year-to-date net income was SAR 17.2 million.
Water Solutions
Revenues in the consolidated water entity, Kindasa, increased by 11.9% compared to the same quarter in 2023, reported at SAR 26.1 million. Gross profit for the quarter was SAR 12.8 million, an increase of 13.5%, with an improved margin of 49.1% due largely to higher transportation revenue and increased water sales.SISCO Holding’s share of Tawzea’s Q3FY24 net income was SAR 7.8 million.
Investor Relations
Email: ir@sisco.com.sa / sisco@sapiencecomms.co.uk
About SISCO
SISCO Holding is an investment company with a diversified portfolio of unique assets spanning infrastructure, ports and logistics and water solutions, building on the success of establishing unique companies that hold market leading positions. SISCO Holding was established in 1984, supported by a team of more than 4,000 employees and provides strategic support to portfolio companies with a clear and long-term investment philosophy to unlock available growth opportunities. The company has assets under management of over SAR four (4) billion through its eight (8) strategic portfolio companies.
Disclaimer
This communication has been prepared by Sustainable Infrastructure Holding Company (“SISCO”) and reflects the management’s current expectations or strategy concerning future events that are subject to known and unknown risks and uncertainties. Some of the statements in this communication constitute "forward-looking statements” that do not directly or exclusively relate to historical facts. These forward-looking statements reflect SISCO’s current intentions, plan, expectations, assumptions, and beliefs about future events and are subject to risks, uncertainties and other factors, many of which are outside SISCO’s control.
Important factors that could cause actual results to differ materially from the expectations expressed or implied in the forward-looking statements include known and unknown risks. SISCO undertakes no obligation to revise any such forward-looking statements to reflect any changes to its expectations or any change in circumstances, events, strategy or plans. Because actual results could differ materially from SISCO’s current intentions, plans, expectations, assumptions and beliefs about the future, you are urged to view all forward-looking statements contained in this presentation with due care and caution and seek independent advice when evaluating investment decisions concerning SISCO.
No representation or warranty, express or implied, is made or given by or on behalf of SISCO or any of its respective members, directors, officers or employees or any other person as to the accuracy, completeness or fairness of the information or opinions contained in or discussed in this communication. This communication does not constitute an offer or invitation to purchase any shares or other securities in the Company and neither it nor any part of it shall form the basis of, or be relied upon in connection with, any contact or commitment whatsoever.
