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Arafa achieves operating profits of US$14 mn during FY'11
03 May '12
5 min read
Consolidated EBITDA recorded USD 23 million with a margin of 8.3% compared to USD 24 million with a margin of 8.6% during the same period of last year. Consolidated EBIT for Arafa Holding reached USD 14 million versus USD 16 million with a margin of 5.1% in FY 2011 compared to 5.7% in FY 2010.
Despite of the significant improvement in the retail segment during the year where it recorded profits of USD 2.8 million versus last year's losses of USD 12.2 million; Arafa Holding's profitability was hit by the slower than expected improvement in UK operations represented by the Baird Group which was estimated to record slight profitability, yet it contributed a consolidated net loss of approximately USD 7 million during the year which is significantly lower than last year's losses.
Moreover, Arafa Holding has been undertaking a significant cost cutting process through downsizing programs and business restructuring incurring some exceptional costs during the year. It is anticipated that Arafa Holding will reap the benefit of its cost cutting programs during this year FY2012.
On another front, as a result of the logistical interruptions that followed the Egyptian revolution; the garment manufacturing segment incurred significant exceptional costs during the first half of the year in terms of discounts and air freight to ensure delivery in a timely manner in order to retain its strong international customer base.
Net Profit after Tax reached USD 8 million in FY 2011 compared to USD 17 million in FY 2010, thus yielding a net profit margin of 2.9% compared to 6.0% in FY 2010. The notable decline in profitability is mainly attributed to the lower other income and the lack of capital gains compared to last year.
On a Standalone basis, Arafa Holding reported a Net Loss of USD 1.8 million compared to a Net Profit after Tax of USD 35 million in FY 2010 which included significant non-recurring capital gains.
Retail Segment witnessed significant improvements driven by local retail coupled with lower losses from the UK operations on the back of stringent measures taken to restructure and control costs.
As a result, the retail segment turned into positive area to generate a net profit of USD 2.8 million in the reporting period compared to net losses last year amounted to USD 12.2 million.
The Apparel & Tailoring (“A&T”) segment managed to grow revenues by almost 10% y-o-y to reach USD 125 million. However, the disruptions in manufacturing facilities earlier in the year led to higher production, selling and shipping costs which harmed the segment's profitability.
The Textiles Segment witnessed a mild slow down of 5.5% in revenues in FY 2011 leading to a drop of USD 700K in profits.
Despite of the significant improvement in the retail segment during the year where it recorded profits of USD 2.8 million versus last year's losses of USD 12.2 million; Arafa Holding's profitability was hit by the slower than expected improvement in UK operations represented by the Baird Group which was estimated to record slight profitability, yet it contributed a consolidated net loss of approximately USD 7 million during the year which is significantly lower than last year's losses.
Moreover, Arafa Holding has been undertaking a significant cost cutting process through downsizing programs and business restructuring incurring some exceptional costs during the year. It is anticipated that Arafa Holding will reap the benefit of its cost cutting programs during this year FY2012.
On another front, as a result of the logistical interruptions that followed the Egyptian revolution; the garment manufacturing segment incurred significant exceptional costs during the first half of the year in terms of discounts and air freight to ensure delivery in a timely manner in order to retain its strong international customer base.
Net Profit after Tax reached USD 8 million in FY 2011 compared to USD 17 million in FY 2010, thus yielding a net profit margin of 2.9% compared to 6.0% in FY 2010. The notable decline in profitability is mainly attributed to the lower other income and the lack of capital gains compared to last year.
On a Standalone basis, Arafa Holding reported a Net Loss of USD 1.8 million compared to a Net Profit after Tax of USD 35 million in FY 2010 which included significant non-recurring capital gains.
Retail Segment witnessed significant improvements driven by local retail coupled with lower losses from the UK operations on the back of stringent measures taken to restructure and control costs.
As a result, the retail segment turned into positive area to generate a net profit of USD 2.8 million in the reporting period compared to net losses last year amounted to USD 12.2 million.
The Apparel & Tailoring (“A&T”) segment managed to grow revenues by almost 10% y-o-y to reach USD 125 million. However, the disruptions in manufacturing facilities earlier in the year led to higher production, selling and shipping costs which harmed the segment's profitability.
The Textiles Segment witnessed a mild slow down of 5.5% in revenues in FY 2011 leading to a drop of USD 700K in profits.
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