MEPCO’s H1 2020 net profit jumps to SAR 15.6 mln

MEPCO’s H1 2020 net profit jumps to SAR 15.6 mln

19/08/2020 Argaam Exclusive

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Middle East Paper Co. (MEPCO) reported a net profit after Zakat and tax of around SAR 15.6 million for the first half of 2020, from SAR 1.8 million a year earlier on higher sales volumes, decrease in the cost of sales per ton, general and administrative expenses, as well as selling and distribution expenses.



Financials (M)

Item 6m 2019 6m 2020 Change‬
Revenues 357.93 367.49 2.7 %
Gross Income 72.44 80.39 11.0 %
Operating Income 16.34 28.39 73.8 %
Net Income 1.76 15.56 786.8 %
Average Shares 66.67 66.67 -
EPS (Riyals) 0.03 0.23 786.8 %

The company reported a net profit after Zakat and tax of SAR 11.4 million in Q2 2020, compared to a net loss after Zakat and tax of SAR 4 million, driven by an increase in sales volume and selling prices, decrease in the cost of sales per ton, lower allowance for impairment of trade receivables, finance costs, in addition to an increase in fair value gain on derivative instruments.



Current Quarter Comparison (M)

Compared With The
Item Q2 2019 Q2 2020 Change‬
Revenues 176.09 193.62 10.0 %
Gross Income 33.11 44.77 35.2 %
Operating Income 3.16 17.80 462.6 %
Net Income (4.03) 11.44 383.9 %
Average Shares 66.67 66.67 -
EPS (Riyals) (0.06) 0.17 383.9 %

On a quarterly basis, Q2 2020 earnings surged 177.4% on higher selling prices, a decrease in general and administrative expenses and lower finance costs. However, the impact was partially offset by an increase in the cost of sales per ton, allowance for impairment of trade receivables, and Zakat expense.



Financial results (Million)

Period Revenues Change Gross Income Change Operating Income Change
Q1 2011 - - - - - -
Q2 2011 - - - - - -
Q3 2011 - - - - - -
Q4 2011 - - - - - -
Q1 2012 - - - - - -
Q2 2012 - - - - - -
Q3 2012 - - - - - -
Q4 2012 - - - - - -
Q1 2013 175.85 - 41.28 - 20.60 -
Q2 2013 195.47 - 50.61 - 29.56 -
Q3 2013 200.50 - 61.21 - 41.72 -
Q4 2013 188.35 - 50.81 - 32.76 -
Q1 2014 200.96 14.3 % 52.97 28.3 % 29.65 44.0 %
Q2 2014 203.05 3.9 % 59.04 16.7 % 36.78 24.4 %
Q3 2014 219.60 9.5 % 68.98 12.7 % 43.91 5.3 %
Q4 2014 202.50 7.5 % 53.41 5.1 % 31.88 (2.7 %)
Q1 2015 184.71 (8.1 %) 47.14 (11.0 %) 28.15 (5.1 %)
Q2 2015 184.14 (9.3 %) 48.17 (18.4 %) 26.28 (28.5 %)
Q3 2015 172.83 (21.3 %) 41.85 (39.3 %) 16.89 (61.5 %)
Q4 2015 139.50 (31.1 %) 35.70 (33.2 %) 10.55 (66.9 %)
Q1 2016 176.54 (4.4 %) 48.80 3.5 % 24.52 (12.9 %)
Q2 2016 164.82 (10.5 %) 28.37 (41.1 %) 3.01 (88.6 %)
Q3 2016 148.13 (14.3 %) 28.76 (31.3 %) 6.28 (62.8 %)
Q4 2016 144.91 3.9 % 25.36 (29.0 %) (1.29) (112.2 %)
Q1 2017 166.50 (5.7 %) 31.67 (35.1 %) 11.07 (54.9 %)
Q2 2017 186.72 13.3 % 45.42 60.1 % 25.51 749.0 %
Q3 2017 212.74 43.6 % 55.30 92.3 % 27.92 344.4 %
Q4 2017 205.05 41.5 % 53.72 111.9 % 30.89 2494.7 %
Q1 2018 225.01 35.1 % 62.10 96.1 % 35.34 219.3 %
Q2 2018 218.57 17.1 % 63.12 39.0 % 35.88 40.6 %
Q3 2018 215.59 1.3 % 65.08 17.7 % 38.85 39.1 %
Q4 2018 174.44 (14.9 %) 45.37 (15.5 %) 19.79 (35.9 %)
Q1 2019 181.84 (19.2 %) 39.33 (36.7 %) 13.17 (62.7 %)
Q2 2019 176.09 (19.4 %) 33.11 (47.5 %) 3.16 (91.2 %)
Q3 2019 180.67 (16.2 %) 39.27 (39.7 %) 9.33 (76.0 %)
Q4 2019 152.48 (12.6 %) 30.00 (33.9 %) 3.96 (80.0 %)
Q1 2020 173.87 (4.4 %) 35.61 (9.4 %) 10.59 (19.6 %)
Q2 2020 193.62 10.0 % 44.77 35.2 % 17.80 462.6 %


Profit Performance (Million)

Period Net Income Change EPS(Riyal) Extraordinary Income/Expense Net Profit Before Unusual Items EPS Before XO Items
Q1 2011 - - - - - -
Q2 2011 - - - - - -
Q3 2011 - - - - - -
Q4 2011 - - - - - -
Q1 2012 - - - - - -
Q2 2012 - - - - - -
Q3 2012 - - - - - -
Q4 2012 - - - - - -
Q1 2013 11.26 - 0.17 - 11.26 0.17
Q2 2013 22.76 - 0.34 - 22.76 0.34
Q3 2013 31.50 - 0.47 - 31.50 0.47
Q4 2013 22.56 - 0.34 - 22.56 0.34
Q1 2014 22.83 102.7 % 0.34 - 22.83 0.34
Q2 2014 29.26 28.6 % 0.44 - 29.26 0.44
Q3 2014 36.35 15.4 % 0.55 - 36.35 0.55
Q4 2014 22.91 1.5 % 0.34 - 22.91 0.34
Q1 2015 23.20 1.6 % 0.35 - 23.20 0.35
Q2 2015 19.57 (33.1 %) 0.29 - 19.57 0.29
Q3 2015 9.58 (73.6 %) 0.14 - 9.58 0.14
Q4 2015 2.77 (87.9 %) 0.04 - 2.77 0.04
Q1 2016 16.78 (27.7 %) 0.25 - 16.78 0.25
Q2 2016 88.31 351.3 % 1.32 91.96 (3.65) (0.05)
Q3 2016 2.28 (76.2 %) 0.03 - 2.28 0.03
Q4 2016 (12.46) (550.0 %) (0.19) - (12.46) (0.19)
Q1 2017 3.25 (80.6 %) 0.05 - 3.25 0.05
Q2 2017 18.18 (79.4 %) 0.27 - 18.18 0.27
Q3 2017 22.22 873.6 % 0.33 - 22.22 0.33
Q4 2017 24.49 296.4 % 0.37 - 24.49 0.37
Q1 2018 28.08 763.1 % 0.42 - 28.08 0.42
Q2 2018 28.92 59.1 % 0.43 - 28.92 0.43
Q3 2018 30.17 35.8 % 0.45 - 30.17 0.45
Q4 2018 12.29 (49.8 %) 0.18 - 12.29 0.18
Q1 2019 5.78 (79.4 %) 0.09 - 5.78 0.09
Q2 2019 (4.03) (113.9 %) (0.06) - (4.03) (0.06)
Q3 2019 0.86 (97.2 %) 0.01 - 0.86 0.01
Q4 2019 3.52 (71.4 %) 0.05 - 3.52 0.05
Q1 2020 4.12 (28.7 %) 0.06 - 4.12 0.06
Q2 2020 11.44 383.9 % 0.17 - 11.44 0.17

Profitability

Period Gross Margin OIBDA Margin Net Margin Before Unusual Items
Q1 2011 - - -
Q2 2011 - - -
Q3 2011 - - -
Q4 2011 - - -
Q1 2012 - - -
Q2 2012 - - -
Q3 2012 - - -
Q4 2012 - - -
Q1 2013 - - -
Q2 2013 - - -
Q3 2013 - - -
Q4 2013 26.82 % 26.56 % 11.59 %
Q1 2014 27.46 % 27.05 % 12.69 %
Q2 2014 28.26 % 28.06 % 13.39 %
Q3 2014 28.55 % 28.01 % 13.67 %
Q4 2014 28.37 % 27.86 % 13.48 %
Q1 2015 28.22 % 28.65 % 13.79 %
Q2 2015 27.52 % 28.28 % 12.90 %
Q3 2015 25.61 % 26.90 % 10.11 %
Q4 2015 25.38 % 26.78 % 8.09 %
Q1 2016 25.93 % 25.91 % 7.23 %
Q2 2016 23.67 % 22.33 % 3.90 %
Q3 2016 22.52 % 20.72 % 2.89 %
Q4 2016 20.69 % 17.73 % 0.46 %
Q1 2017 18.28 % 16.26 % (1.69 %)
Q2 2017 20.30 % 19.74 % 1.74 %
Q3 2017 22.19 % 21.31 % 4.39 %
Q4 2017 24.14 % 24.13 % 8.84 %
Q1 2018 26.10 % 25.32 % 11.21 %
Q2 2018 27.19 % 25.45 % 12.04 %
Q3 2018 28.24 % 26.54 % 12.92 %
Q4 2018 28.27 % 25.99 % 11.93 %
Q1 2019 26.93 % 24.90 % 9.76 %
Q2 2019 24.45 % 22.24 % 5.91 %
Q3 2019 22.03 % 19.44 % 2.09 %
Q4 2019 20.51 % 18.15 % 0.89 %
Q1 2020 20.20 % 18.30 % 0.65 %
Q2 2020 21.36 % 20.35 % 2.85 %


Per Share Data (Riyal)

Compared With The
Period Shares Outstanding (M) EPS (Riyal) Adjusted EPS (Riyal) Book Value (BV)
Q1 2011 - - - -
Q2 2011 - - - -
Q3 2011 - - - -
Q4 2011 66.67 - - 6.47
Q1 2012 - - - -
Q2 2012 - - - -
Q3 2012 - - - -
Q4 2012 66.67 - - 7.04
Q1 2013 66.67 - - 7.21
Q2 2013 66.67 - - 7.55
Q3 2013 66.67 - - 8.02
Q4 2013 66.67 1.32 1.32 7.99
Q1 2014 66.67 1.49 1.49 8.33
Q2 2014 66.67 1.59 1.59 8.15
Q3 2014 66.67 1.66 1.66 8.70
Q4 2014 66.67 1.67 1.67 9.04
Q1 2015 66.67 1.68 1.68 9.39
Q2 2015 66.67 1.53 1.53 9.68
Q3 2015 66.67 1.13 1.13 9.83
Q4 2015 66.67 0.83 0.83 9.87
Q1 2016 66.67 0.73 0.73 9.62
Q2 2016 66.67 1.76 0.38 10.57
Q3 2016 66.67 1.65 0.27 10.59
Q4 2016 66.67 1.42 0.04 10.40
Q1 2017 66.67 1.22 (0.16) 10.45
Q2 2017 66.67 0.17 0.17 10.16
Q3 2017 66.67 0.47 0.47 10.49
Q4 2017 66.67 1.02 1.02 10.84
Q1 2018 66.67 1.39 1.39 11.26
Q2 2018 66.67 1.56 1.56 11.03
Q3 2018 66.67 1.67 1.67 11.48
Q4 2018 66.67 1.49 1.49 11.27
Q1 2019 66.67 1.16 1.16 10.98
Q2 2019 66.67 0.66 0.66 10.92
Q3 2019 66.67 0.22 0.22 10.93
Q4 2019 66.67 0.09 0.09 10.97
Q1 2020 66.67 0.07 0.07 11.03
Q2 2020 66.67 0.30 0.30 11.20

Multiple Ratios (End of Period Price)

Compared With The
Period P/E Adjusted P/E Price/book
Q1 2011 - - -
Q2 2011 - - -
Q3 2011 - - -
Q4 2011 - - -
Q1 2012 - - -
Q2 2012 - - -
Q3 2012 - - -
Q4 2012 - - -
Q1 2013 - - -
Q2 2013 - - -
Q3 2013 - - -
Q4 2013 - - -
Q1 2014 - - -
Q2 2014 - - -
Q3 2014 - - -
Q4 2014 - - -
Q1 2015 - - -
Q2 2015 26.14 26.14 4.13
Q3 2015 25.29 25.29 2.90
Q4 2015 30.07 30.07 2.52
Q1 2016 24.74 24.74 1.88
Q2 2016 10.23 47.15 1.71
Q3 2016 8.19 49.60 1.28
Q4 2016 11.33 More than 100 1.55
Q1 2017 13.51 NEG 1.58
Q2 2017 82.07 82.07 1.36
Q3 2017 35.31 35.31 1.57
Q4 2017 18.43 18.43 1.74
Q1 2018 17.27 17.27 2.14
Q2 2018 15.70 15.70 2.22
Q3 2018 12.80 12.80 1.87
Q4 2018 13.06 13.06 1.73
Q1 2019 16.04 16.04 1.69
Q2 2019 22.88 22.88 1.39
Q3 2019 58.38 58.38 1.19
Q4 2019 More than 100 More than 100 1.27
Q1 2020 More than 100 More than 100 1.02
Q2 2020 45.84 45.84 1.22

Business Segments (Million)

Compared With The
Period The industrial sector The commercial sector Disposals
Q1 2013 158.35 71.46 (53.97)
Q2 2013 178.71 81.47 (64.72)
Q3 2013 185.64 77.94 (63.08)
Q4 2013 178.20 71.61 (61.46)
Q1 2014 189.39 64.27 (52.69)
Q2 2014 186.73 82.23 (65.90)
Q3 2014 204.13 83.05 (67.58)
Q4 2014 190.08 90.98 (78.55)
Q1 2015 149.78 73.94 (39.01)
Q2 2015 170.79 72.52 (59.17)
Q3 2015 171.60 59.18 (57.94)
Q4 2015 142.39 54.31 (57.21)
Q1 2016 167.90 61.40 (52.77)
Q2 2016 147.30 58.38 (40.87)
Q3 2016 137.14 62.02 (51.03)
Q4 2016 139.15 59.06 (53.30)
Q1 2017 150.79 75.52 (59.81)
Q2 2017 175.55 79.95 (68.78)
Q3 2017 204.74 81.55 (73.55)
Q4 2017 198.50 86.34 (79.79)
Q1 2018 219.22 72.35 (66.56)
Q2 2018 212.34 64.57 (58.34)
Q3 2018 210.95 82.60 (77.96)
Q4 2018 169.13 74.19 (68.87)
Q1 2019 176.27 70.97 (65.40)
Q2 2019 169.92 62.05 (55.89)
Q3 2019 174.70 50.16 (44.20)
Q4 2019 149.00 55.05 (51.56)
Q1 2020 170.43 42.64 (39.20)
Q2 2020 190.92 43.30 (40.59)

Analysts Estimates (Million)

Item Q2 2020 (e) Q2 2020 (a) Change‬
Average 5.50 11.44 108.00 %

Estimates vs Actual (Million)

Item Q2 2020 (e) Q2 2020 (a) Change
OSOOL AND BAKHEET 5.50 11.44 108.0 %

Current
Market Cap (M Riyal) 3,297.79
Enterprise Value (EV) (M) 3,286.35
Shares Outstanding ((M)) 86.67
EPS ( Riyal) (TTM) (0.80)
Book Value (BV) ( Riyal) 19.07
Par Value ( Riyal) 10.00
Adjusted P/E (Last12) Neg
P/E (TTM) NEG
Price/book 2.00
Return on Average Assets (%) (TTM) (3.04 )
Return on Average Equity (%) (TTM) (5.01 )

Share Price

38.00
(0.25) (0.65 %)

Middle East Paper Co. (MEPCO)


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