DUBAI, May 9 (Reuters) - Consumer cyclical shares in Saudi Arabia may outperform an otherwise weak regional market on Tuesday following strong financial results from one of the largest retailers in the kingdom.
Bookstore and electronics seller Jarir made a net profit of 221.4 million riyals ($59.04 million) in the first three months to March 31, up 26.5 percent from the year ago period and above the analysts’ average forecast of 179.7 million riyals.
Jarir, whose top line grew by 20.3 percent to 1.71 billion riyals in the period, attributed the rise in its net income to an increase in sales of smartphones and in its school supplies wholesale segment, and to lower selling and distribution expenses.
“Businesses are starting to get smart about how they spend their money, and this has become evidential in the results from most retailers so far,” said a Jeddah-based analyst.
The company’s board recommended distributing 2.2 riyals per share for the first quarter.
Most Saudi companies have now reported earnings with most retailers showing better-than-expected results and an improving net income. The deadline for all companies to report is May 11.
In Abu Dhabi, the largest listed developer Aldar Properties reported a first-quarter net profit of 641 million dirhams ($174.52 million), at the upper end of analysts’ estimates but down from the 649.05 million dirhams it made in the prior year period.
Aldar’s revenue witnessed a 28 percent growth from first quarter 2016, and the company said it made 1 billion dirhams of development sales adding that all its future developments remain on track for handover in 2017.
Sentiment in the region may however remain dampened as Brent crude contracts stay stuck below $50 a barrel for a third session in a row.
$1 = 3.7501 riyals $1 = 3.6729 UAE dirham Reporting by Celine Aswad; Editing by Biju Dwarakanath