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Q1 gross profit increases 40% vs. LY to reach SAR96 Million
Riyadh, KSA – May 1 , 2019: L’azurde Company for Jewelry (“L’azurde”, “the Company”), the largest gold and jewelry designer, manufacturer, wholesaler and retailer in the Middle East, announced today its financial results for the first quarter of 2019.
The Company’s operating revenues for the first quarter of 2019, amounted to SAR 153 Million, increasing by 33.0% compared to SAR 115.0 million in the same quarter of last year.
The higher operating revenues were reflected in an increase in gross profit, which amounted to SAR 96.0 million for the first quarter of 2019, 40.2% higher than the same quarter of last year. Gross Profit margin also improved by 3.2% due to cost saving initiatives that contributed in reducing production costs.
In KSA, wholesale revenues increased by 24.5% versus same quarter last year due to a successful new collection and celebrity endorsement. Also, KSA’s retail revenues including L’azurde, Kenaz, airports points of sales and the consolidation of TOUS, the new franchise business increased by 55.6% versus same quarter last year.
During the first quarter, Egypt’s revenues continued to perform strongly with a growth of 18.5% in the wholesale due to a successful advertising campaign and strong new collection. Egypt’s retail revenues increased by 56.8% compared to the same quarter of last year due to the successful opening of several new outlets during the last twelve months. Also, L’azurde Egypt Retail revenues increased by 20% in first quarter of 2019, without taking into account the six new outlets.
Operating expenses of SAR 65.6 million for the first quarter of 2019 were 44.4% higher than the same quarter of last year of SAR 45.4 million mainly due to higher marketing expenses, higher variable expenses related to higher revenues, consolidating the operating expenses of TOUS, and the operating costs of new retail shops in Egypt.
In spite of this, the operating profit amounted to SAR 30.4 million for the first quarter of 2019, higher by 31.9% compared to SAR 23.0 million in the same quarter of last year.
Net profit for the first quarter of 2019, amounted to SAR 12.0 million, an increase of 32.5% compared to SAR 9.0 million of net profit for the same quarter of last year, driven by higher operating revenues and despite an increase of SAR 1.6 million in Egypt subsidiaries corporate tax expenses.
For more detailed information about L’azurde Financial Statements for the first quarter of 2019, please visit the Company’s website (https://www.lazurde.com) under investors’ relations section.
Since it was founded in 1980, L’azurde has excelled at the art of jewelry design. Today, it is the largest gold and jewelry designer, manufacturer, wholesaler and retailer in the MENA region, and the fourth largest gold manufacturer in the world, selling over one million pieces of jewelry per annum.
L’azurde has over 2,000 employees and produces more than 4,000 different jewelry models every year in 21-karat and 18-karat gold and diamond jewelry. The jewelry pieces are manufactured at the Company’s factories in Saudi Arabia and Egypt, using advanced high-technology equipment, and distributed to more than 1,800 retailers across the GCC and MENA region, as well as being exported to more than 28 countries outside the region. L’azurde also has its own network of 20 mono brand retail shops at top malls in KSA and Egypt, where it is focused on the sale of diamond jewelry.
In line with its strategy to become a ‘house of brands’, L’azurde finalized in October 2018 the acquisition of the TOUS franchisee in KSA. TOUS is an international lifestyle brand focused on affordable luxury that has been in business for almost 100 years and with more than 620 stores in over 53 countries. As a franchisor, TOUS designs, manufactures and sells jewelry, bags and accessories for women and men. Their offering covers a wide range of products including fine jewelry with diamond, gold and silver, its core business, and handbags, fragrances and accessories. TOUS has been present in KSA since 2008 with a network today of 26 stores across the Kingdom.