Shaker to unveil new strategy soon, expects more participation in mega projects: CEO

Mohammed Abunayyan, CEO of Al Hassan Ghazi Ibrahim Shaker Co.

Al Hassan Ghazi Ibrahim Shaker Co. plans to disclose its new strategic vision in the near future, being the foundation directing its endeavors towards the next stage of growth and prosperity, CEO Mohammed Abunayyan told Argaam in an interview.

Abunayyan added that the effectiveness of the group’s key growth strategies was evident in its Q1 2024 financial performance. It has made long strides to diversify its product portfolio, especially in the heating, ventilation and air conditioning (HVAC) solutions segment, which is witnessing increasing demand.

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He explained that the HVAC solutions segment’s first-quarter revenues soared 47% year-on-year (YoY), supported by demand for mega projects and infrastructure developments in the Kingdom. Further, the projects segment benefited from the rise in investments in local mega projects and the huge infrastructure developments Kingdom-wide, in line with the Saudi Vision 2030.

The group's diverse product portfolio and its brand’s high value, according to the top executive, continued to support consolidating the importance of the consumer sales (home appliances) segment as a basic pillar. He indicated that focus would remain on strengthening Shaker's HVAC segment, while ensuring the strategic, thoughtful management of the home appliances portfolio.

The CEO also underscored Shaker’s commitment towards excellence in operational processes and strategic cost management, which contributed to garnering positive results, not to mention the top line growth rates. Therefore, the group will continue to step up its sales channels mix within retail, e-commerce and projects, in a bid to accelerate its development pace, he further stated.

Moreover, he explained that Shaker's overall revenue growth remained strong during Q1 2024, thanks to the robust hike in the HVAC segment’s sales. This is in addition to balanced growth across its brand portfolio, paired with the flexible model in business performance. This was despite the YoY decline in the home appliances segment’s first-quarter sales as a result of the regulation of sales.

On expectations for Q2 2024, Abunayyan anticipated the group’s participation in local mega projects to increase, which will positively impact its development plans. Shaker also seeks to enhance its online presence and adopt effective strategic initiatives, including continuing to invest in e-commerce to meet the growing demand from consumers.

Regarding its market share, the CEO highlighted that Shaker enjoys market leadership across various segments given its global brand portfolio, which includes LG, Bompani, Midea, Ariston, Indesit, and Maytag, alongside its own high-quality products.

He stated that the LG-Shaker plant showed solid performance during the first quarter of 2024, contributing to the growth of Shaker’s HVAC segment. Besides, a memorandum of understanding (MoU) was signed with LG Electronics and the Saudi Ministry of Investment to explore the local manufacturing of air conditioning unit compressors.

The factory, according to Abunayyan, already began manufacturing the VRF tech-backed Multi V5 air conditioning units locally, in an attempt to meet the needs of customers in more than 20 countries in the Middle East and North Africa (MENA) region.

The group's current focus is on digital transformation, with a special focus on its transition to using the SAP S/4HANA system, which is expected to be fully launched during the third quarter of 2024. The new system will help boost Shaker’s operational efficiency and improve its digital potential, the top executive pointed out.

Looking ahead, the group remains committed to sustainable development, strategic expansion, and transforming operations, Abunayyan added.

According to the data available on Argaam, Shaker’s net profit rose 12% to SAR 32.3 million in Q1 2024, compared to SAR 28.8 million in Q1 2023.