Rasan posts 34% profit rise to SAR 46M in 2023; Q4 at SAR 9.6M

Rasan Information Technology Co., which will list shares soon on the Saudi Exchange (TASI), reported a net profit rise of 34% to SAR 46 million in 2023, from SAR 9.6 million a year earlier.

Rasan attributed its profit increase for the current period, compared to last year, to a significant rise in revenues, which surged 57.7% to SAR 198.8 million, primarily due to higher revenues from a subsidiary in electronic insurance brokerage. Concurrently, financing costs decreased by 79.8% following the settlement of a related-party loan.

Despite these gains, the company faced a reduction in the operating profit margin to 19.7% from 25.7% due to higher general and administrative expenses and increased marketing costs. Additionally, zakat and income tax expenses rose, with income tax expenses reaching SAR 1.5 million.

At the end of the period, shareholders' equity, excluding minority interests, stood at SAR 120.99 million, up from SAR 74.47 million at the end of the previous year. EBITDA for the current period reached SAR 63.87 million, compared to SAR 51.18 million in the prior period.

Cash from operating activities was SAR 71.76 million for the current period, up from SAR 65.65 million in the corresponding period last year. Capital expenditures were SAR 31.08 million, an increase from SAR 21.55 million, and cash from financing activities amounted to a net outflow of SAR 2.90 million, compared to SAR 1.74 million.

The cash balance at the end of the period was SAR 116.5 million.

The company's revenue is distributed across several key segments, with the insurance sector (vehicles and medical) generating SAR 198.83 million in 2023, up from SAR 127.64 million in 2022. The leasing segment contributed SAR 53.24 million, up from SAR 32.78 million, and the online auction sector brought in SAR 3.53 million, up from SAR 2.05 million. Additionally, AR Solutions (data analysis software) generated revenues of SAR 625 thousand in 2023, starting from zero the previous year.

On July 6, 2023, the extraordinary general meeting (EGM) approved capital increase from SAR 25.5 million to SAR 70.5 million by SAR 1 per share, through the capitalization of SAR 37.35 million from retained earnings and SAR 7.65 million from statutory reserves.