Shaker Group aims to trim losses further in H2 2019: CEO

Saudi-based Al-Hassan Ghazi Ibrahim Shaker (Shaker Group) is working to narrow its losses further in the second half of the year, supported by rising revenue, CEO Azzam Saud Almudaiheem told Argaam in an exclusive interview.

 “We are happy to see that the breakthrough transformation program is already having a tangible effect on our performance, having been implemented in Q1 2019 and delivering consistent and promising results throughout the first half of the year,” he said.

The Saudi Stock Exchange (Tadawul)-listed firm cut first half 2019 net losses by 31 percent year-on-year (YoY) to SAR 38.7 million. The second-quarter net loss declined 75 percent YoY to SAR 9.94 million.

“The significant reduction in net and operating losses is a result of the breakthrough program we implemented earlier in the year. We have already achieved successes following the rollout of the program, particularly when it comes to reducing operating expenses and improving efficiencies,” Almudaiheem noted.

In the second quarter, operating expenses decreased as a result of reduced employee-related costs, lower rental costs and reductions in other expenses, as sales improved significantly, he added.

Launched in February 2019, the breakthrough transformation program is based on four pillars - core business turnaround, talent upgrade plan, performance infrastructure and strategic moves – that aim at improving business performance.

When asked if the company is looking at becoming profitable in 2020, the CEO said that the program is expected to deliver a “positive” impact from both an operational and financial perspective.

“While we have experienced difficult years in a challenging market, we’ve taken measures to address these issues head-on to improve performance. Our program is supported by the long-term potential that we see in the market for AC and home appliances. We intend to capitalize on every relevant opportunity available in the Kingdom.”

Almudaiheem revealed they are bidding for several retrofitting projects in the private and public sector.

“These projects represent an important opportunity for us to leverage our dominant market share of superior inverter technology, offering a reliable and energy-efficient product range, and we view retrofitting as an exciting growth avenue for the group,” he noted.

The Saudi government’s “Tarshid” program aims to retrofit assets including two million street lights, 110,000 government buildings, 35,000 schools, 100,000 mosques and 2,500 hospitals and clinics.

Meanwhile, Shaker Group is working on improving its debt position as it focuses on rolling out initiatives in line with its breakthrough program.

“Our priority at the moment is centered on growth by solidifying our sales channels, capturing new market opportunities and reducing operating costs,” he concluded.

To contact the writer, email Parag Deulgaonkar at parag.d@argaamplus.com