The following factors mainly explain the changes in group revenues in the first quarter of 2024:

1. Group total revenues, including gold metal value, were SAR 545.5 million in the first quarter of 2024, an increase of 10% compared to SAR 496.3 million in the in the same quarter of last year. It is worth noting that the Group does not make profits or losses from the value of the sold gold as a metal.

2. Group operating revenues, which better represent revenues of the Group after excluding gold metal value, amounted to SAR 145.5 million in the first quarter of 2023, an increase of 15.4% compared to SAR 126.1 million in the same quarter of last year.

In KSA, wholesale operating revenues were 1.0% higher than last year due to strong sales of L’azurde gold in traditional gold souks. Retail operating revenues were 30.4% higher than last year due to growth in like-for-like sales of the existing stores and extension of the stores network by opening seven new stores in top locations.

In Egypt, wholesale operating revenues increased by 14% when compared to the same period of last year due to strong sales of L’azurde gold in traditional gold souks. Retail operating revenues grew by 22%, supported by growth in like-for-like sales of the existing stores and extension of the stores network by opening new stores in top locations.

1. Group gross profit of SAR 93.7 million in the first quarter of 2024 was 18.5% higher than same quarter last year of SAR 79.1 million due to higher operating revenues and higher gross margin percentage.

2. Group operating expenses of SAR 61.6 million were 14.1% higher than in the same quarter last year of SAR 54.0 million mainly due to the opening of new retail stores.

3. Group operating profit of SAR 32.1 million for the first quarter of 2024 was higher by 27.9%, when compared to SAR 25.1 million in same quarter last year due to the reasons mentioned above.

4. On 6 March 2024, the Central Bank of Egypt devalued Egyptian Pound (EGP) against all major currencies which impacted the operational results of the Group, by increasing the exchange rate of SAR against EGP, leading to lower revenues and operating profits after translation. The Group has already taken measures to compensate this translation decline by increasing the sales price in EGP in Egypt. The Group has managed to maintain its Gross Profit at a very high level despite the above.

5. On the other hand, due to EGP devaluation, the Group has made a one-off foreign exchange gain on one of its liability accounts which is denominated in EGP.

6. Net profit in the first quarter of 2024 amounted to SAR 28.0 million compared to SAR 11.6 million in the same quarter last year, an increase of 141.4% for the reasons mentioned above.

7. Basic Earnings per Share (“EPS”) improved to SAR 0.49 in the first quarter of 2024 compared to SAR 0.20 in the same quarter last year.

8. Total Shareholders’ Equity on 31 March 2024 was SAR 320.6 million compared to SAR 378.8 million on 31 March 2023, a decrease of 15.4%, due to payment of dividends, and a negative movement in the Currency Translation Reserve due to unrealized foreign exchange differences on investment in Egypt. It is worth mentioning that the Currency Translation Reserve is a non-cash item that arises on consolidation only and fluctuates with the fluctuation of the foreign exchange rates.

2. Operating revenues of SAR 145.5 million for the first quarter of 2024 were higher than fourth quarter of 2023 by 36.1% of SAR 106.9 million due to seasonality.

The Company successfully pursued its turnaround plan in 2021-2024 and delivered robust results consistently quarter after quarter. Looking ahead, we will continue implementing innovations and new initiatives to grow our topline, improve our gross margin and operate with lower working capital. We offer a diversified portfolio of brands including L’azurde, TOUS and Miss L’. We keep revitalizing our offering to adapt and win in times of changing consumers’ shopping behaviors by launching new products offering great value to consumers and providing us strong margins.

The strategic drivers for the future success of the Company consist of:

1. Expanding the fast-growing Miss L’ fashion jewelry line to its full potential through our own retail points of sales, e-commerce, and 3rd party retailers.

2. Growing our successful L’azurde retail business through new points of sales and a stronger assortment. Especially in KSA, we have a great opportunity to increase the current network of L’azurde retail to a much larger and profitable network, leveraging the very strong brand awareness and 40-year-old legacy. The Company has been successful in finding several promising new retail locations where further new stores will be opened soon.

3. Accelerate development of the wholesale business selling jewelry by weight, through a revitalized collections assortment, more profitable products mix, marketing support and lower working capital.

4. Leveraging our solid customers’ network in the traditional gold jewelry market to expand product lines, drive new collections distribution, thereby improving revenues and profits.

5. Scaling our fast-growing e-commerce business through more investments in technology, infrastructure, systems and building a state-of-the-art and experienced digital organization.

6. Expanding the TOUS global franchise business in KSA through stronger assortment, new stores, and more investments in marketing.

7. Developing new material growth initiatives across the GCC to leverage the Company’s capabilities and diversify the revenues and profits outside Egypt.

8. Growing our cash position while continuing to generate positive cash flows and reinforcing our solid banking relationships to support the Company’s transformation initiatives.

For more information, we would like to draw the attention of the shareholders that the Consolidated Financial Statements for the year ended 31 March 2024 will be available on Company’s website (http://www.lazurde.com) under investors’ relations section.