Dubai-based fresh food retailer Spinneys today announced its financial results for the three-month and six-month periods ended 30 June 2024. The company‘s performance has been remarkable, with record-breaking revenues and profitability.
First-half revenues reached a new high of AED1.6 billion ($435.6 million), representing a 9.9 percent year-on-year increase. Profit for the period stood at AED146 million ($39.74 million), up 15.2 percent despite the impact of the recently introduced UAE Corporate Tax and one-off expenses associated with the company’s recent initial public offering (IPO). Spinneys will pay its first post-IPO interim dividend of AED102.6 million ($27.93 million), equivalent to 2.85 fils per share and 70 percent of distributable profits, in August 2024.
Operational highlights
The strong financial performance was driven by a 9.8 percent like-for-like sales growth and the expansion of the company’s physical footprint. Spinneys opened four new locations in the first half of 2024, including stores in Al Khawaneej (Dubai), Sobha (Dubai), The Kitchen by Spinneys in Dubai Mall, and the company’s first store in Riyadh, Saudi Arabia. The company had previously opened one new store at Damac Ventura (Dubai) in the second half of 2023.
Gross profit and margin expansion
Gross profit increased by 12.3 percent year-on-year to reach AED659 million, with a robust gross profit margin of 41.3 percent, a 90 basis point improvement compared to the prior year. This margin expansion was driven by the company’s efficient sourcing and supply chain capabilities, as well as its successful fresh premium offering and private label strategy.
Profitability and EBITDA
Adjusted EBITDA totaled AED304 million in the first six months of 2024, up 9.4 percent year-on-year, with an Adjusted EBITDA margin of 19 percent, despite the impact of one-off IPO-related costs and pre-store opening expenses in Saudi Arabia. Profit before tax grew by 27.1 percent year-on-year to AED163 million ($44.37 million), while profit for the period increased by 15.2 percent year-on-year to AED146 million, despite the introduction of a 9 percent Corporate Tax in the UAE.
E-commerce growth
Spinneys’ e-commerce sales continued to grow, increasing by 21.7 percent year-on-year and surpassing AED217 million for the H1 2024 period. Overall e-commerce sales as a percentage of revenue reached 13.6 percent, and the company remains committed to enhancing its digital retail offering.
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