Spinneys one of the UAE’s leading fresh food retailers, on Thursday announced that first-half revenues reached a record high of Dh1.6 billion, increasing by 9.9 per cent year-on-year
Profit for the period stood at Dh146 million, up 15.2 per cent despite the impact of the recently introduced UAE corporate tax and oneoff expenses associated with the Company’s recent IPO.
In a statement to the Dubai Financial Market, Spinneys announced that will pay its first post-IPO interim dividend of Dh102.6 million, equivalent to 2.85 fils per share and 70 per cent of distributable profits, this month.
Revenue grew by 9.9 per cent year-on-year to reach Dh1.6 billion in the first six months of 2024, driven by like-for-like sales growth of 9.8 per cent supplemented by the H1 2024 opening of four new locations in Al Khawaneej (Dubai), Sobha (Dubai), The Kitchen, by Spinneys in Dubai Mall and the launch of Spinneys’ first store in Riyadh, having previously opened one new store at Damac Ventura (Dubai) in the second half of 2023.
Gross profit increased by 12.3 per cent year-on-year to reach Dh659 million in the six months ended June 30, 2024. Spinneys’ gross profit margin stood at 41.3 per cent, a 90 basis point improvement versus the prior year. Margin expansion was mainly due to the Group’s efficient sourcing and supply chain capabilities, and successful fresh premium offering and private label strategy.
Adjusted Ebitda totaled Dh304 million in the first six months of 2024, up 9.4 per cent year-on-year with an adjusted Ebitda margin of 19 per cent, despite the impact of one-off IPO related costs and pre-store opening expenses in Saudi Arabia. Profit before tax grew by 27.1 per cent year-on-year to Dh163 million, while profit for the period increased by 15.2 per cent year-on-year to Dh146 million, despite the introduction of 9 per cent corporate tax in the UAE. Spinneys’ net profit margin of 9.2 per cent represented a 50 basis point improvement from the prior year.
Transaction growth increased nine per cent year on year to 18.3 million for the H1 2024 period. Average basket size was stable, up 0.6 per cent year on year, supported by continued strength in customer demand.
Spinneys opened four new stores in H1 2024, adding 7.9 per cent to its gross selling area (GSA), with the company operating a total of 79 stores as at June 30, 2024, having opened one new store in the second half of 2023. The new store openings were partially offset by the closure of two locations in the corresponding period of the previous year. Spinneys said it remains committed to expanding its store footprint, with a healthy pipeline of new locations planned in the UAE, as well as in Saudi Arabia following the opening of Spinneys at Riyadh’s La Strada Yard. The Kitchen by Spinneys launched the company’s first-ever foodhall concept in Dubai Mall during the second quarter, with margins well above grocery retail margins and further locations set to open in the UAE later this year.
Spinneys’ ecommerce sales increased by 21.7 per cent year-on-year, surpassing Dh217 million for the H1 2024 period. Overall ecommerce sales as a percentage of revenue reached 13.6 per cent, and Spinneys plans to enhancing its digital retail offering through the recent refresh of its app to include the Spinneys Swift hyperlocal delivery option, successfully piloting a 60-minute delivery service in four key locations with roll-out continuing across the UAE.
Sunil Kumar, chief executive officer at Spinneys, commented: “We are delighted to report record revenues for H1 2024, reflecting robust and growing demand for our unique proposition. These results also mark a significant milestone as we announce our first post-IPO interim dividend, demonstrating our commitment to delivering value to our shareholders. During the first half of the year, we made a number of important steps in the execution of our strategy. Coupled with the successful upgrade of our ecommerce app, which now includes hyperlocal option Spinneys Swift, these achievements underscore our commitment both to growth and innovation and provide us with powerful momentum to carry into the second half of the year.”