November 6, 2018 / 2:29 PM / 9 days ago

Saudi Arabia's Savola makes third-quarter loss on lower sales

DUBAI, Nov 6 (Reuters) - Savola Group, Saudi Arabia’s largest food products company, reported a third-quarter loss of 50.7 million riyals ($13.5 million), its third loss in the last four quarters, due to lower sales and higher financing costs.

Analysts at EFG Hermes and NCB Capital had forecast the company would make a profit of 211.9 million riyals and 196.0 million riyals, respectively.

The company made a profit of 829 million riyals in the third quarter of last year.

Savola and other consumer goods companies in Saudi Arabia are suffering from the effects of subsidy cuts, the introduction of VAT and an exodus of expatriates which have all put pressure on consumer spending.

Savola blamed the loss on lower sales and margins, a lower share of profits from associates and higher net finance costs mainly due to currency exchange losses.

Savola, which operates internationally in markets including Turkey, Egypt, Iran and United Arab Emirates, said earlier this week it was moving forward with a 565.5 million riyals deal for its subsidiary to acquire a stake in Al Kabeer Group. ($1 = 3.7509 riyals) (Reporting By Tom Arnold. Editing by Jane Merriman)

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