| The reason of the increase (decrease) in the sales/ revenues during the current quarter compared to the same quarter of the last year is |
The increase in sales is attributed to the growth in both the quantities and average selling prices of water heater products, as well as the rise in average selling prices of tiles and sanitaryware products, despite the decline in sales volumes of these products during the current quarter compared to the same quarter of the last year |
| The reason of the increase (decrease) in the net profit during the current quarter compared to the same quarter of the last year is |
The increase in net profit is attributed to the growth in gross profit, driven by higher average selling prices and lower production costs, particularly for water heater products. This comes despite an increase in selling and distribution expenses, mainly due to higher transportation costs resulting from the rise in fuel prices at the beginning of the current quarter compared to the same quarter of the last year. |
| The reason of the increase (decrease) in the net profit (loss) during the current quarter compared to the previous one is |
The increase in net profit is attributed to the growth in gross profit resulting from higher average selling prices and lower production costs during the current quarter, in addition to a decrease in property, plant, and equipment for the red bricks segment and the subsidiary "Ceramic Pipes Company," as well as the recognition of inventory provisions in the previous quarter. |
| Comment mentioned in the external auditor’s report, mentioned in any of the following paragraphs (other matter, conservation, notice, disclaimer of opinion, or adverse opinion) |
The Consolidated financial statement of the Group for the period ended 31 March 2024 were reviewed by another auditor who expressed a modified conclusion on those financial statements dated Shawwal 26, 1445 H (corresponding to May 05, 2024). The basis for qualified conclusion of the predecessor auditor was as follows: “The accompanying interim condensed consolidated statement of financial position includes property, plant, and equipment (PPE) amounting to Saudi Riyal 1,510 million as at March 31, 2024. The Group performed a detailed impairment assessment to determine the recoverable value of PPE for one if its subsidiaries, Ceramic Pipes Company (“CPC”), which resulted in an impairment loss of Saudi Riyals 78 million as at December 31, 2023. However, while identifying the smallest cash generating unit (“CGU”), the Group has considered all of its PPE, including land of CPC as a single CGU. Determining the land to be included in the CGU is not in accordance with International Accounting Standard 36 -Impairment of Assets. Had the land been excluded from the CGU, based on the valuation performed by management as at March 31, 2024, the impairment loss would have increased by Saudi Riyals 65 million.” However, we are of the conclusion that the inclusion of land to be part of the CGU is in line with International Accounting Standard 36 - Impairment of Assets on the premise that the land is part of the smallest identifiable group of assets that generates cash inflows that are largely independent of the cash inflows from other assets or groups of assets |
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