Lazurde to partly use capital hike proceeds to cut costs, boost profitability: CEO

Selim Chidiac, CEO of Lazurde Company for Jewelry

Lazurde Company for Jewelry will partly deploy the capital increase proceeds to reduce costs, boost profitability and expand in the retail and e-commerce business, chief executive officer (CEO) Selim Chidiac told Argaam.

Lazurde’s credit facilities are divided into gold facilities, which account for 80% of the SAR 1 billion facilities on the balance sheet, while cash represents the remaining 20%.

The capital hike is a positive opportunity for the current shareholders and investors, who can subscribe to the capital increase at SAR 10 per share. The stock trades, currently, at double this value. Accordingly, they can benefit from higher revenue and profit in the medium and long term.

The affordable jewelry business is developing rapidly worldwide, compared to luxury jewelry, as the region is witnessing higher demand for light-weighted jewelry, Chidiac noted.

Lazurde priced affordable jewelry products between SAR 500 and SAR 2,000 for the first time, which currently make up almost 20% of total revenue and are witnessing rapid development.

The company’s shareholders approved the board of directors’ recommendation to increase capital to SAR 575 million through a rights issue worth SAR 145 million, during the extraordinary general assembly meeting (EGM) held on June 2, 2021.