Al-Modawat reports net profit of SAR 10.9M in H1 2023; IPO to start on Jan. 28

Logo of Al-Modawat Specialized Medical

Al-Modawat Specialized Medical Co., which will expectedly list shares on Nomu-Parallel Market, reported a net profit of SAR 10.9 million, or SAR 5.75 a share, for H1 2023, compared to SAR 3.6 million in the prior-year period.

Sales growth and higher operating revenue, especially for the medical services business division, supported the growth in earnings. Further, profit margins improved to 42.4%, from 52.9% backed by operating efficiency and lower direct cost to sales.

Company’s Operating Segments

Medical services, the company’s core segment, saw its profit margins rise 10.6%, buoyed by revenue growth and lower direct cost to sales. Conversely, profit margins of the pharmaceuticals segment dropped to 19.8%, from 21.7% in the prior year period.

The following table shows key highlights of the company’s income statement in 2022, compared to 2021:

The company reported net earnings of SAR 10.3 million in 2022, versus losses of SAR 2.2 million in 2021, due to improved operating performance.

Financial Position

The company’s financial statements revealed that accounts receivables continued to rise, reaching SAR 24.2 million, aligning with higher revenue. Government and insurance accounts, including seven insurers and 25 insurance brokerages by end of June 2023, accounted for approximately 90% of the accounts receivables, and hence, they are relatively of a low risk.

Retained earnings by June 30, 2023, stood at SAR 17 million. This will allow the company to enhance growth from its own resources instead of securing bank loans, in the light of high SAIBOR.