Riyadh, KSA: L’azurde Company for Jewelry (“L’azurde”, “the Group”, “the Company”), the largest gold and jewelry designer, manufacturer, wholesaler and retailer in the Middle East, announced today its financial results for the second quarter of 2021, reporting a continued strong performance during current half year. The Group’s operating revenues for the first half of 2021 amounted to SAR 260 million, generating an operating profit of SAR 48 million, a whopping increase of 225% compared to same period of last year. Net profit for first half of 2021 amounted to SAR 18 million. The Group has also managed to generate a positive cash inflow from operations of SAR 34 million in the first six months of 2021. These positive figures are mainly due to the successful implementation of commercial and strategic transformational initiatives undertaken by the Group in 2020, further building on the remarkable growth it achieved in Q1 2021.
During Q2 2021, L'azurde has achieved operating revenues of SAR 121 million with a growth rate of 148% compared with the same period of 2020, across all channels and geographies. The Company also generated a net profit of SAR 8 million in the second quarter of 2021 taking H1 2021 net profit to SAR 18 million; achieving a growth rate of 127% higher than the same period of the past year. The net profit, resulting from the growth in operating revenues, is mainly attributable to the strategic and commercial initiatives taken by the Company in the year 2020 including the optimization of its gold working capital, which significantly reduced finance costs.
With the current half year witnessing a recovery across all the markets, wholesale operating revenues in KSA were 50% higher than same period of last year that was affected by a complete closure of gold souks and malls since mid-March 2020. Retail revenues have also increased by 38% compared to first half year of 2020, the increase being mainly attributable to the successful launch of Miss L’ and L’azurde InStyle brands, the new fast growing L’azurde e-commerce platforms, and the easing of COVID-19 related precautionary measures.
Similarly, the Group has reported a strong performance in Egypt in the first half of 2021. Wholesale operating revenues in Egypt impressively grew by 75% compared to same period of last year as the demand for L’azurde’s gold jewelry continues to remain very high in Egypt and the advertising campaigns are having a positive impact on demand. Furthermore, the growth of revenues in shops and across e-commerce platforms, the opening of new outlets in the last twelve months, the successful launches of Miss L’ and L’azurde InStyle brands and the easing of COVID-19 related precautionary measures were the reasons behind an impressive growth in retail operating revenues in Egypt which increased by 78% compared to first half of 2020.
Group launched the new fast growing e-commerce business in March 2020, which has already delivered SAR 11 million revenues in H1 2021 (H1 2020: SAR 1 million) which represents a solid promising share of 4% of Group operating revenues and 10% of Retail revenues. The newly launched Miss L’ and L’azurde InStyle brands have performed very well also and have together contributed SAR 50 million revenues in H1 2021 which represents 19% of Group operating revenues (H1 2020: represented 9% of Group operating revenues).
L’azurde has further built on the remarkable growth it achieved in the first quarter of 2021, and has secured a much stronger position in the market than prior to COVID-19 crisis”, said Mr. Sélim Chidiac, CEO of L’azurde. “We are reaping now what we sowed when we accelerated the Company’s transformation strategy to sell modern, fashionable and affordable jewelry with higher margins and lower needs of working capital. We have also embraced the House of Brands strategy with the TOUS acquisition, Miss L’ and L’azurde InStyle recent successful introductions, in addition to launching the e-commerce business which rapidly generated a promising share of business”, he added.
The Company's main strategy to achieve future success depends on many points, according to Mr. Chidiac. From developing the fast-growing Miss L’ fashion jewelry line to its full potential through retail points of sales, to expanding the successful L'azurde retail business through new points of sales and a stronger assortment, and rebuilding the traditional wholesale business and selling jewelry by weight, in addition to leveraging the Company’s solid customers’ network in the traditional Gold jewelry souks to fully develop the recently launched L’azurde InStyle jewelry line sold by piece. On a final note, the Company will be scaling its fast-growing e-commerce business and expanding the TOUS global franchise business in KSA. Mr. Chidiac believes that the very recent Rights Issue will also reinforce the Company’s capital structure and will help accelerate the growth over years 2022-2024.
© Press Release 2021
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