Today's Edition
A. SREENIVASA REDDY (ABU DHABI)
Lulu Retail delivered robust revenue growth in Q3 2024, reaching $1.86 billion, up 6.1% year-on-year (YoY).
The company announced its financial results for the third quarter (Q3) and the first nine months (9M) of this year in its first financial update since its IPO on the Abu Dhabi Securities Exchange (ADX) on November 14.
Trading in Lulu shares at the ADX was muted on Thursday morning as the financial results did not appear to have much impact in the early trading. The share price remained at Dh2.03, the previous day’s close, though the retail giant’s shares were being traded in big quantity in terms of value and volume. The price is likely to pick up at the close of the market.
In a statement, the company said the strong sales performance was driven by significant growth in key markets, including the UAE, the Kingdom of Saudi Arabia, and Kuwait.
Like-for-like (LFL) sales in Q3 2024 increased by 1.2% to $1.7 billion, while LFL sales for 9M 2024 rose by 2.2% to $5.3 billion. LFL is a metric used to measure performance by comparing similar or equivalent items over time, designed to exclude the impact of external factors such as acquisitions, closures, or changes in the scope of operations.
The UAE business saw strong revenue growth of 7.5% in Q3 2024, mainly driven by healthy LFL growth of 4.7% during the quarter. Three new stores were opened during the 9M 2024 period.
Revenue in Saudi Arabia grew by 5.7% to $369.3 million in Q3 2024, driven by an improvement in Lulu’s fresh food offering. Five new stores were opened in Saudi Arabia during the 9M 2024 period.
Oman, Kuwait, and Bahrain all achieved robust revenue growth, while Qatar delivered stable revenue and maintained its leading market share position.
Omnichannel remains a key focus area for Lulu, with e-commerce sales increasing to $237.4 million during the nine-month period, up 83.5% YoY. E-commerce sales now constitute 4.3% of total retail sales.
EBITDA for Q3 2024 was $176.3 million, up 9.9% YoY, with an EBITDA margin of 9.5%. Net profit from continuing operations increased to $35.1 million for the Q3 period, an increase of 126%. For the nine-month period, net profit from continuing operations improved by 73.3% to $151.5 million.
Lulu Retail introduced a total of 12 new stores during the 9M 2024 period, including three express stores in Q3, adding a total of 8,033 square metres during the quarter. Total selling space as of 30 September 2024 was 1.3 million square metres.
The company announced a strategic partnership with Abu Dhabi’s Modon Holding to build retail facilities, including hypermarkets, supermarkets, and other retail stores. Additionally, Lulu opened five more stores, bringing the total number of new stores opened in 2024 to 17.
Yusuffali MA, Chairman of Lulu Retail, commented: “It has been a milestone period for our team, with our record listing on the ADX and our first set of results as a listed company. We’re excited to continue our growth journey as a listed company, delivering on the targets we’ve communicated to investors.”
Saifee Rupawala, Chief Executive Officer of Lulu Retail, added: “The third quarter and nine-month period were marked by ongoing revenue and profit growth across our business, driven by sales growth across our six GCC markets. We are encouraged by the growth we have seen in the business and are pleased to reiterate our guidance for the 2024 period.”
