Budget Saudi profits up - but from selling cars instead of renting them

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RIYADH: Car hire company Budget Saudi lifted first quarter profits — but the increase was driven by sales rather than rentals.

Net income rose 21 percent to SR55.2 million ($14.7 million), the company said in a stock exchange filing on Thursday.

“The increase in the net profit is due to an increase in the net gain on the sale of the vehicles, as more vehicles were sold with improved margin in the first quarter of 2021 compared to the same quarter last year,” the company said in a statement. “The better gain on sale has compensated the decline of lease and rental revenue due to COVID-19, which is not yet recovered or normalized.”

A year of lockdowns, airport closures and other travel-related restrictions has hit car companies hard and forced some to change their business models in response.

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