Zad Holding Company Q.P.S.C. (ZHCD) Earnings Call Transcript & Summary

Hello, and welcome to the Zad Holding year-end financial results conference call. I would like to advise all participants that this call is being recorded. Thank you. I'd now like to welcome Roy Thomas to begin the conference. Roy, over to you.

Thanks, Kevin. Hello, everyone. This is Roy Thomas from QNB Financial Services. I want to welcome everyone to Zad Holding Company's Year-End 2022 Financial Results Conference Call. On this call from Zad Holding, we have Abdul Salam Abdul Hakeem, the Vice President of Finance; and Abdella Ali Ismail, the Head of IR and Board Secretary. We will conduct this conference call, with management first reviewing the company's results followed by Q&A. I will turn the call now over to Abdul Salam. Go ahead, Abdul Salam.

Good day to all of you. Welcome to the conference call to discuss on the financials of Zad Holding Company for the year 2022. I will be giving a brief note on the performance of the company with respect to revenue, gross profit, net profit and EBITDA, and leave it to the floor for the question and answers. We have achieved a revenue of QAR 1.5 billion for the year 2022 as against QAR 1.3 billion for the year 2021 with a growth of almost 18%. We achieved a gross profit of QAR 325 million as against QAR 268.34 million compared to the same period. Net profit remained at QAR 194.2 million as against QAR 193.94 million compared to 2021. We have achieved EBITDA of QAR 284.16 million as against QAR 277 million for the same period 2021. I'll leave it to the floor for the questions and answers.

[Operator Instructions] And your first question comes from the line of [Mustafa Amer] from Al Rayan Investment.

Strong Q4 for you guys. Could you be able to tell us what was the contribution from the World Cup in particular because you had quite a sizable increase in population during that time. Secondly, your other income part has dropped substantially year-on-year. So I was wondering what that component is. And lastly, in terms of the prices on your commodities, how are you seeing that for 2023? I have one more question, I'll ask that later.

Mustafa, thanks for asking the question. So actually, with reference to the growth in the business right now, I won't be able to say like the World Cup has contributed significantly because the businesses -- existing businesses of flower, bakery and edible have really grown up before even the World Cup started right now. During the World Cup, there was a little slightly -- movement. The growth was not there as expected. And we also -- the revenue from the contracting business and the asphalt business has also contributed to the significant growth to the increase in the revenue as well as to the bottom line. Second question is on the other income going down. It's a one-off nature right now like last year, we gained from the sale of commodities like this year, we didn't -- actually, it was strategic side of like holding the investments. We do sell only whenever we need, we only switch over whenever we need. So that did not happen this year. So that's the reason there is sizable down, almost about QAR 40 million down compared to the last year. With reference to commodity price 2023, we don't see any growth -- increase or reduction in the price. We feel that's stable like it will be, except like edible oil. Edible oil is almost volatile, but it may go down to what we expect. I hope I answered your questions, Mustafa.

I just had one more follow-up question with regards to this wheat import restriction from India. We see a lot of flour from your company being supplied all over Qatar. Has that materially impacted you or been beneficial to you in 2023?

Yes. I wouldn't be able to say no or yes to this actually because like the competition is not only from India, right? The competition is from like all over the world like Turkey, Dubai, like UAE, Oman, all over. But with respect to one particular product, like there is definitely a little growth on chakki atta. So that is where the Indian market was playing, okay? Other than that, I don't see any big flour contribution so far.

[Operator Instructions] And there are no further questions at this time. So I'd like to hand back to Roy.

All right. There are no further questions. We'd like to thank Zad Holding Company's management for the results update and answering the queries and look forward to speaking to you all for the first quarter 2023 results conference call. Thank you.

That does conclude our conference for today. Thank you for participating. You may now all disconnect.