Saudi's Savola Q4 net down 17%; misses forecasts

Savola Group, the Saudi-based food conglomerate, posted a 17 percent drop in fourth-quarter net profit, missing analysts' forecasts, mainly due to a gain it booked from land sales in the year-ago quarter.

The firm, which owns the Middle East's biggest sugar refining business, made a net profit of SAR413.4m (US$110.2m) in the three months ending December 31, compared with a profit of SAR498.6m in the same period a year earlier, it said in a statement on Wednesday.

Three analysts surveyed by Reuters expected Savola to post an average profit of SAR456.7m for the fourth-quarter.

Savola attributed the dip in profits to a capital gain of SAR153m it incurred from the sale of two land plots during the fourth quarter of 2011.

Operational profit for the fourth-quarter rose by 32.3 percent to SAR792.2m, the statement said.

In a separate statement, Savola said it expects to make SAR1.5bn before capital gains and exceptional items in 2013 and net income of SAR260m in the first-quarter.

The company also set a dividend of SAR0.5 per share for the fourth quarter.

In October, Savola raised its stake in fellow Saudi food firm Almarai to 36.5 percent from 29.95 percent by purchasing shares worth SAR2bn.

The firm was set to close a SAR1.5bn (US$400m) Islamic bond earlier this week, sources told Reuters.