Elm’s H1 2023 profit up 56% to SAR 695.2 mln; Q2 at SAR 372.8 mln

06/08/2023 Argaam Exclusive

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Elm Co. reported a 56% rise in H1 2023 net profit to SAR 695.2 million, compared to SAR 444.5 million in H1 2022.

Financials (M)

Item	6m 2022	6m 2023	Change‬
Revenues	2,130.78	2,691.99	26.3 %
Gross Income	852.40	1,146.45	34.5 %
Operating Income	508.66	697.53	37.1 %
Net Income	444.50	695.17	56.4 %
Average Shares	80.00	80.00	-
EPS (Riyals)	5.56	8.69	56.4 %

The profit growth was buoyed by an increase of 26.33% year-on-year (YoY) in revenue, pushing gross profit higher by 34.51% YoY. The revenue growth stemmed from an increase in the digital business segment’s revenue by 45.10% YoY. This was offset by a decrease in the professional services segment’s revenue by 13.48%, and a drop of 6.53% YoY in the business process outsourcing revenue.

Impairment in intangible assets decreased by SAR 27 million, while income from Murabaha deposits increased by SAR 51 million YoY.

On the other hand, operating expenses (OpEx) and Zakat charges increased by SAR 78 million and SAR 16 million YoY, respectively.

In Q2 2023, the company’s net profit surged 91% to SAR 372.77 million from SAR 238.86 million in the prior-year period, as revenue jumped 35.13% YoY, leading gross profit to rise by 45.76% YoY.

Impairment in intangible assets decreased by SAR 27 million, while income from Murabaha deposits increased by SAR 22 million YoY. On the other hand, OpEx increased by 11.94% on an annual basis.

The net earnings also jumped by 15.6% from SAR 322.4 million in Q1 2023, thanks to a 9.01% rise in revenue.

Current Quarter Comparison (M)

Compared With The

Item	Q2 2022	Q2 2023	Change‬
Revenues	1,038.77	1,403.83	35.1 %
Gross Income	412.86	601.99	45.8 %
Operating Income	238.86	377.22	57.9 %
Net Income	194.85	372.77	91.3 %
Average Shares	80.00	80.00	-
EPS (Riyals)	2.44	4.66	91.3 %

Item	Q1 2023	Q2 2023	Change‬
Revenues	1,288.16	1,403.83	9.0 %
Gross Income	544.46	601.99	10.6 %
Operating Income	320.32	377.22	17.8 %
Net Income	322.40	372.77	15.6 %
Average Shares	80.00	80.00	-
EPS (Riyals)	4.03	4.66	15.6 %

Shareholders’ equity, no minority interest, reached SAR 3.52 billion by the end of the six-month period, compared to SAR 2.72 billion a year earlier.

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Financial results (Million)

Period	Revenues	Change	Gross Income	Change	Operating Income	Change
Q1 2014	-	-	-	-	-	-
Q2 2014	-	-	-	-	-	-
Q3 2014	-	-	-	-	-	-
Q4 2014	-	-	-	-	-	-
2014	-	-	-	-	-	-
Q1 2015	-	-	-	-	-	-
Q2 2015	-	-	-	-	-	-
Q3 2015	-	-	-	-	-	-
Q4 2015	-	-	-	-	-	-
2015	-	-	-	-	-	-
Q1 2016	-	-	-	-	-	-
Q2 2016	-	-	-	-	-	-
Q3 2016	-	-	-	-	-	-
Q4 2016	-	-	-	-	-	-
2016	-	-	-	-	-	-
Q1 2017	-	-	-	-	-	-
Q2 2017	-	-	-	-	-	-
Q3 2017	-	-	-	-	-	-
Q4 2017	-	-	-	-	-	-
2017	1,981.54	-	696.20	-	286.32	-
Q1 2018	-	-	-	-	-	-
Q2 2018	-	-	-	-	-	-
Q3 2018	-	-	-	-	-	-
Q4 2018	-	-	-	-	-	-
2018	1,925.71	(2.8 %)	719.30	3.3 %	364.27	27.2 %
Q1 2019	-	-	-	-	-	-
Q2 2019	-	-	-	-	-	-
Q3 2019	-	-	-	-	-	-
Q4 2019	-	-	-	-	-	-
2019	2,102.02	9.2 %	681.37	(5.3 %)	300.51	(17.5 %)
Q1 2020	509.41	-	127.92	-	25.56	-
Q2 2020	422.32	-	87.12	-	(5.92)	-
Q3 2020	615.92	-	246.93	-	144.14	-
Q4 2020	918.42	-	375.03	-	191.93	-
2020	2,466.07	17.3 %	837.00	22.8 %	355.61	18.3 %
Q1 2021	773.63	51.9 %	275.46	115.3 %	168.53	559.3 %
Q2 2021	1,017.79	141.0 %	305.93	251.2 %	134.39	2369.8 %
Q3 2021	966.78	57.0 %	327.32	32.6 %	196.31	36.2 %
Q4 2021	1,069.45	16.4 %	414.21	10.4 %	115.37	(39.9 %)
2021	3,827.65	55.2 %	1,322.91	58.1 %	614.60	72.8 %
Q1 2022	1,092.01	41.2 %	439.54	59.6 %	269.81	60.1 %
Q2 2022	1,038.77	2.1 %	412.86	35.0 %	238.86	77.7 %
Q3 2022	1,167.42	20.8 %	485.81	48.4 %	272.88	39.0 %
Q4 2022	1,307.91	22.3 %	547.65	32.2 %	227.31	97.0 %
2022	4,606.10	20.3 %	1,885.86	42.6 %	1,008.85	64.1 %
Q1 2023	1,288.16	18.0 %	544.46	23.9 %	320.32	18.7 %
Q2 2023	1,403.83	35.1 %	601.99	45.8 %	377.22	57.9 %

Period	Revenues	Change	Gross Income	Change	Operating Income	Change
2013	-	-	-	-	-	-
2014	-	-	-	-	-	-
2015	-	-	-	-	-	-
2016	-	-	-	-	-	-
2017	1,981.54	-	696.20	-	286.32	-
2018	1,925.71	(2.8 %)	719.30	3.3 %	364.27	27.2 %
2019	2,102.02	9.2 %	681.37	(5.3 %)	300.51	(17.5 %)
2020	2,466.07	17.3 %	837.00	22.8 %	355.61	18.3 %
2021	3,827.65	55.2 %	1,322.91	58.1 %	614.60	72.8 %
2022	4,606.10	20.3 %	1,885.86	42.6 %	1,008.85	64.1 %

Profit Performance (Million)

Period	Net Income	Change	EPS(Riyal)	Extraordinary Income/Expense	Net Profit Before Unusual Items	EPS Before XO Items
Q1 2014	-	-	-	-	-	-
Q2 2014	-	-	-	-	-	-
Q3 2014	-	-	-	-	-	-
Q4 2014	-	-	-	-	-	-
2014	-	-	-	-	-	-
Q1 2015	-	-	-	-	-	-
Q2 2015	-	-	-	-	-	-
Q3 2015	-	-	-	-	-	-
Q4 2015	-	-	-	-	-	-
2015	-	-	-	-	-	-
Q1 2016	-	-	-	-	-	-
Q2 2016	-	-	-	-	-	-
Q3 2016	-	-	-	-	-	-
Q4 2016	-	-	-	-	-	-
2016	-	-	-	-	-	-
Q1 2017	-	-	-	-	-	-
Q2 2017	-	-	-	-	-	-
Q3 2017	-	-	-	-	-	-
Q4 2017	-	-	-	-	-	-
2017	368.61	-	4.61	84.11	284.50	3.56
Q1 2018	-	-	-	-	-	-
Q2 2018	-	-	-	-	-	-
Q3 2018	-	-	-	-	-	-
Q4 2018	-	-	-	-	-	-
2018	364.33	(1.2 %)	4.55	-	364.33	4.55
Q1 2019	-	-	-	-	-	-
Q2 2019	-	-	-	-	-	-
Q3 2019	-	-	-	-	-	-
Q4 2019	-	-	-	-	-	-
2019	307.18	(15.7 %)	3.84	-	307.18	3.84
Q1 2020	28.79	-	0.36	-	28.79	0.36
Q2 2020	(2.14)	-	(0.03)	-	(2.14)	(0.03)
Q3 2020	147.99	-	1.85	-	147.99	1.85
Q4 2020	132.04	-	1.65	-	132.04	1.65
2020	306.58	(0.2 %)	3.83	-	306.58	3.83
Q1 2021	168.87	486.5 %	2.11	20.53	148.34	1.85
Q2 2021	110.15	5252.0 %	1.38	-	110.15	1.38
Q3 2021	177.60	20.0 %	2.22	0.33	177.28	2.22
Q4 2021	110.27	(16.5 %)	1.38	3.84	106.43	1.33
2021	566.89	84.9 %	7.09	24.70	542.20	6.78
Q1 2022	249.64	47.8 %	3.12	-	249.64	3.12
Q2 2022	194.85	76.9 %	2.44	(27.08)	221.93	2.77
Q3 2022	273.36	53.9 %	3.42	(1.05)	274.41	3.43
Q4 2022	212.33	92.6 %	2.65	(8.33)	221.07	2.76
2022	930.19	64.1 %	11.63	(36.46)	966.65	12.08
Q1 2023	322.40	29.1 %	4.03	-	322.40	4.03
Q2 2023	372.77	91.3 %	4.66	-	372.77	4.66

Period	Net Income	Change	EPS(Riyal)	Extraordinary Income/Expense	Net Profit Before Unusual Items	EPS Before XO Items
2013	-	-	-	-	-	-
2014	-	-	-	-	-	-
2015	-	-	-	-	-	-
2016	-	-	-	-	-	-
2017	368.61	-	4.61	84.11	284.50	3.56
2018	364.33	(1.2 %)	4.55	-	364.33	4.55
2019	307.18	(15.7 %)	3.84	-	307.18	3.84
2020	306.58	(0.2 %)	3.83	-	306.58	3.83
2021	566.89	84.9 %	7.09	24.70	542.20	6.78
2022	930.19	64.1 %	11.63	(36.46)	966.65	12.08

Profitability

Period	Gross Margin	OIBDA Margin	Net Margin Before Unusual Items
Q1 2014	-	-	-
Q2 2014	-	-	-
Q3 2014	-	-	-
Q4 2014	-	-	-
2014	-	-	-
Q1 2015	-	-	-
Q2 2015	-	-	-
Q3 2015	-	-	-
Q4 2015	-	-	-
2015	-	-	-
Q1 2016	-	-	-
Q2 2016	-	-	-
Q3 2016	-	-	-
Q4 2016	-	-	-
2016	-	-	-
Q1 2017	-	-	-
Q2 2017	-	-	-
Q3 2017	-	-	-
Q4 2017	-	-	-
2017	35.13 %	17.88 %	14.36 %
Q1 2018	-	-	-
Q2 2018	-	-	-
Q3 2018	-	-	-
Q4 2018	-	-	-
2018	37.35 %	22.44 %	18.92 %
Q1 2019	-	-	-
Q2 2019	-	-	-
Q3 2019	-	-	-
Q4 2019	-	-	-
2019	32.41 %	18.43 %	14.61 %
Q1 2020	-	-	-
Q2 2020	-	-	-
Q3 2020	-	-	-
Q4 2020	33.94 %	18.95 %	12.44 %
2020	33.94 %	18.95 %	12.43 %
Q1 2021	36.06 %	22.33 %	15.61 %
Q2 2021	36.18 %	22.56 %	16.19 %
Q3 2021	34.92 %	21.90 %	15.44 %
Q4 2021	34.56 %	19.08 %	14.17 %
2021	34.56 %	19.08 %	14.17 %
Q1 2022	35.87 %	20.07 %	15.52 %
Q2 2022	38.25 %	22.49 %	18.13 %
Q3 2022	40.12 %	23.22 %	19.52 %
Q4 2022	40.94 %	24.51 %	20.99 %
2022	40.94 %	24.51 %	20.99 %
Q1 2023	41.46 %	24.72 %	21.65 %
Q2 2023	42.19 %	25.73 %	23.04 %

Period	Gross Margin	OIBDA Margin	Net Margin Before Unusual Items
2013	-	-	-
2014	-	-	-
2015	-	-	-
2016	-	-	-
2017	35.13 %	17.88 %	14.36 %
2018	37.35 %	22.44 %	18.92 %
2019	32.41 %	18.43 %	14.61 %
2020	33.94 %	18.95 %	12.43 %
2021	34.56 %	19.08 %	14.17 %
2022	40.94 %	24.51 %	20.99 %

Period	Gross Margin	OIBDA Margin	Net Margin Before Unusual Items
Q1 2014	-	-	-
Q2 2014	-	-	-
Q3 2014	-	-	-
Q4 2014	-	-	-
Q1 2015	-	-	-
Q2 2015	-	-	-
Q3 2015	-	-	-
Q4 2015	-	-	-
Q1 2016	-	-	-
Q2 2016	-	-	-
Q3 2016	-	-	-
Q4 2016	-	-	-
Q1 2017	-	-	-
Q2 2017	-	-	-
Q3 2017	-	-	-
Q4 2017	-	-	-
Q1 2018	-	-	-
Q2 2018	-	-	-
Q3 2018	-	-	-
Q4 2018	-	-	-
Q1 2019	-	-	-
Q2 2019	-	-	-
Q3 2019	-	-	-
Q4 2019	-	-	-
Q1 2020	25.11 %	10.29 %	5.65 %
Q2 2020	20.63 %	4.93 %	(0.51 %)
Q3 2020	40.09 %	27.91 %	24.03 %
Q4 2020	40.83 %	24.19 %	14.38 %
Q1 2021	35.61 %	25.19 %	19.17 %
Q2 2021	30.06 %	15.85 %	10.82 %
Q3 2021	33.86 %	23.46 %	18.34 %
Q4 2021	38.73 %	13.78 %	9.95 %
Q1 2022	40.25 %	27.15 %	22.86 %
Q2 2022	39.74 %	25.67 %	21.36 %
Q3 2022	41.61 %	26.00 %	23.51 %
Q4 2022	41.87 %	20.04 %	16.90 %
Q1 2023	42.27 %	27.52 %	25.03 %
Q2 2023	42.88 %	29.17 %	26.55 %

Per Share Data (Riyal)

Compared With The

Period	Shares Outstanding (M)	EPS (Riyal)	Adjusted EPS (Riyal)	Book Value (BV)
Q1 2014	-	-	-	-
Q2 2014	-	-	-	-
Q3 2014	-	-	-	-
Q4 2014	-	-	-	-
Q1 2015	-	-	-	-
Q2 2015	-	-	-	-
Q3 2015	-	-	-	-
Q4 2015	-	-	-	-
Q1 2016	-	-	-	-
Q2 2016	-	-	-	-
Q3 2016	-	-	-	-
Q4 2016	-	-	-	-
Q1 2017	-	-	-	-
Q2 2017	-	-	-	-
Q3 2017	-	-	-	-
Q4 2017	-	-	-	-
Q1 2018	-	-	-	-
Q2 2018	-	-	-	-
Q3 2018	-	-	-	-
Q4 2018	-	-	-	-
Q1 2019	-	-	-	-
Q2 2019	-	-	-	-
Q3 2019	-	-	-	-
Q4 2019	-	-	-	-
Q1 2020	80.00	-	-	24.44
Q2 2020	80.00	-	-	-
Q3 2020	80.00	-	-	-
Q4 2020	80.00	3.83	3.83	27.92
Q1 2021	80.00	5.58	5.33	30.04
Q2 2021	80.00	6.99	6.73	31.41
Q3 2021	80.00	7.36	7.10	33.63
Q4 2021	80.00	7.09	6.78	35.12
Q1 2022	80.00	8.10	8.04	34.40
Q2 2022	80.00	9.15	9.44	34.01
Q3 2022	80.00	10.35	10.66	35.56
Q4 2022	80.00	11.63	12.09	38.09
Q1 2023	80.00	12.54	13.00	39.31
Q2 2023	80.00	14.76	14.88	44.03

Period	Shares Outstanding (M)	EPS (Riyal)	Adjusted EPS (Riyal)	Book Value (BV)
2013	-	-	-	-
2014	-	-	-	-
2015	-	-	-	-
2016	-	-	-	-
2017	80.00	4.61	3.56	14.72
2018	80.00	4.55	4.55	15.15
2019	80.00	3.84	3.84	18.87
2020	80.00	3.83	3.83	27.92
2021	80.00	7.09	6.78	35.12
2022	80.00	11.63	12.08	38.09

Multiple Ratios (End of Period Price)

Compared With The

Period	P/E	Adjusted P/E	Price/book
Q1 2014	-	-	-
Q2 2014	-	-	-
Q3 2014	-	-	-
Q4 2014	-	-	-
Q1 2015	-	-	-
Q2 2015	-	-	-
Q3 2015	-	-	-
Q4 2015	-	-	-
Q1 2016	-	-	-
Q2 2016	-	-	-
Q3 2016	-	-	-
Q4 2016	-	-	-
Q1 2017	-	-	-
Q2 2017	-	-	-
Q3 2017	-	-	-
Q4 2017	-	-	-
Q1 2018	-	-	-
Q2 2018	-	-	-
Q3 2018	-	-	-
Q4 2018	-	-	-
Q1 2019	-	-	-
Q2 2019	-	-	-
Q3 2019	-	-	-
Q4 2019	-	-	-
Q1 2020	-	-	-
Q2 2020	-	-	-
Q3 2020	-	-	-
Q4 2020	-	-	-
Q1 2021	-	-	-
Q2 2021	-	-	-
Q3 2021	-	-	-
Q4 2021	-	-	-
Q1 2022	26.53	26.70	6.24
Q2 2022	27.02	26.20	7.50
Q3 2022	30.60	29.73	8.91
Q4 2022	27.73	26.67	8.72
Q1 2023	35.24	33.99	11.24
Q2 2023	38.29	37.98	13.22

Period	P/E	Adjusted P/E	Price/book
2013	-	-	-
2014	-	-	-
2015	-	-	-
2016	-	-	-
2017	-	-	-
2018	-	-	-
2019	-	-	-
2020	-	-	-
2021	-	-	-
2022	28.55	27.48	8.72

Business Segments (Million)

Compared With The

Period	Digital Business	Business process outsourcing	Digital Services
Q1 2020	392.23	90.27	26.91
Q2 2020	309.90	86.72	25.70
Q3 2020	398.54	202.79	14.59
Q4 2020	626.42	272.71	19.29
Q1 2021	460.17	290.17	23.30
Q2 2021	596.01	396.36	25.41
Q3 2021	475.69	467.59	23.50
Q4 2021	570.50	481.06	17.88
Q1 2022	657.15	387.14	47.72
Q2 2022	710.15	287.24	41.38
Q3 2022	797.04	342.12	28.26
Q4 2022	987.45	284.87	35.58
Q1 2023	970.82	279.64	37.70
Q2 2023	1,012.18	356.36	35.30

Period	Digital Business	Business process outsourcing	Digital Services
2017	1,364.76	550.46	66.31
2018	1,422.64	384.76	118.31
2019	1,531.11	432.87	138.05
2020	1,727.09	652.49	86.49
2021	2,102.37	1,635.18	90.10
2022	3,151.78	1,301.38	152.94

Analysts Estimates (Million)

Item	Q2 2023 (e)	Q2 2023 (a)	Change‬
Average	310.33	372.77	20.12 %

Estimates vs Actual (Million)

Item	Q2 2023 (e)	Q2 2023 (a)	Change
Arqaam Capital	335.00	372.77	11.3 %
Bank of America	311.00	372.77	19.9 %
Riyad Capital	285.00	372.77	30.8 %

Financial Ratios

	Current
Market Cap (M Riyal)	90,240.00
Enterprise Value (EV) (M)	87,501.53
Shares Outstanding ((M))	80.00
EPS ( Riyal) (TTM)	20.70
Book Value (BV) ( Riyal)	59.79
Par Value ( Riyal)	10.00
Adjusted P/E (Last12)	More than 100
P/E (TTM)	More than 100
Price/book	18.87
Return on Average Assets (%) (TTM)	20.5
Return on Average Equity (%) (TTM)	39.4

Elm Co. (ELM)

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Elm’s H1 2023 profit up 56% to SAR 695.2 mln; Q2 at SAR 372.8 mln

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Financials (M)

Current Quarter Comparison (M)

Financial results (Million)

Financial results (Million)

Profit Performance (Million)

Profit Performance (Million)

Profitability

Profitability

Per Share Data (Riyal)

Per Share Data (Riyal)

Multiple Ratios (End of Period Price)

Ratios And Multiples

Business Segments (Million)

Revenue by Business Segment (Latest) 2023 Q2

Analysts Estimates (Million)

Analysts Estimates (Million)

Estimates vs Actual (Million)

Estimates Accuracy

Financial Ratios

Share Price

Elm Co. (ELM)

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Elm’s H1 2023 profit up 56% to SAR 695.2 mln; Q2 at SAR 372.8 mln

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Financials (M)

Current Quarter Comparison (M)

Financial results (Million)

Financial results (Million)

Profit Performance (Million)

Profit Performance (Million)

Profitability

Profitability

Per Share Data (Riyal)

Per Share Data (Riyal)

Multiple Ratios (End of Period Price)

Ratios And Multiples

Business Segments (Million) Q2 2023

Revenue by Business Segment (Latest) 2023 Q2

Analysts Estimates (Million)

Analysts Estimates (Million)

Estimates vs Actual (Million)

Estimates Accuracy

Financial Ratios

Share Price

Elm Co. (ELM)

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Business Segments (Million)