Page 1

2015 35TH ANNIVERSARY | 1981-2016

DISTRIBUTION | MANUFACTURING | DESIGN AND BUILD


II

ROOTS GROUP ARABIA ANNUAL REPORT 2015


ROOTS GROUP ARABIA ANNUAL REPORT 2015

III


THE BUILDING PARTNERS

1

ROOTS GROUP ARABIA ANNUAL REPORT 2015


WELCOME Roots Group Arabia is a conglomerate of companies with integrated Distribution, Manufacturing, and Design and Build Services. Established in Saudi Arabia in 1981, RGA is today a leading presence in the construction sector providing customers in 26 markets across KSA, UAE, Qatar, Egypt, Lebanon, Syria, Jordan, Nigeria, Tanzania, Malaysia, China, and the UK with distribution of building materials and equipment, manufacturing of architectural finishes and sanitary ware, power generation solutions, and design and execution of large scale interiors. Roots Group Arabia carries over 60 of the world’s most recognized building materials, construction equipment and power tool brands, in addition to an exclusive in-house line to offer over 60,000 products from tower cranes to masonry nails. Twelve plants in KSA and Egypt manufacture over 3,000 products covering architectural metal and woodworks, waterproofing products, commercial paints, ceiling systems, and sanitary products. The integrated services of UK-based Areen and the Areen Group of specialized interior design firms and contracting subsidiaries MIMAR International and MIMAR Projects in KSA, Qatar and the UAE have designed and executed exclusive interior projects in aviation, hospitality, education, residential, and healthcare.

Saudi Arabia | Lebanon | UAE | UK | Egypt | Syria Qatar | Nigeria | Tanzania | Malaysia | China | Jordan

RGA owns and operates 12 production facilities, 40 retail outlets, 26 warehouses empowered by 9,700 employees. In 2015, the Group’s client base exceeded 17,000 worldwide and revenues topped SAR 3.3 Billion. RGA’s network of distributors is operational in 32 markets across 26 countries worldwide. Providing total solutions to builders and contractors worldwide.

ROOTS GROUP ARABIA ANNUAL REPORT 2015

2


3

ROOTS GROUP ARABIA ANNUAL REPORT 2015


MISSION We look to provide our customers with solutions to all their construction needs. We do so through our integrated business divisions, partnerships with the world’s best manufacturers of building materials and equipment, and a committed and motivated local workforce.

VISION We look to remain strongly rooted at the heart of the building construction sector through steadfast leadership, diversification and consistency. Always true to our stronghold in the Kingdom of Saudi Arabia, we aim to grow our services into an integrated company providing the highest quality solutions to our customers across all our markets.

ROOTS GROUP ARABIA ANNUAL REPORT 2015

4


CONTENTS

5

ROOTS GROUP ARABIA ANNUAL REPORT 2015

THE BUILDING PARTNERS

1

WELCOME

2

MISSION / VISION

4

A MESSAGE FROM OUR CHAIRMAN

7

A MESSAGE FROM OUR CEO

9

THE ROOTS GROUP / CURRENT BOARD OF DIRECTORS

12

THE ROOTS GROUP / EXECUTIVE MANAGEMENT TEAM

13

THE ROOTS GROUP / EXECUTIVE MANAGEMENT TEAM

14

ROOTS GROUP ARABIA 

15

OVERVIEW OF ROOTS GROUP

16

DIVISIONS & COMPANIES - DISTRIBUTION

17

DISTRIBUTION

20

WHOLESALE

21

DISTRIBUTION DIVISION WHOLESALE SUBSIDIARIES

24

RETAIL (GULF DEPOT)

25

SPECIAL PROJECTS DIVISION – SPD

26

DIVISIONS & COMPANIES - MANUFACTURING 

27


MANUFACTURING

30

DIVISIONS & COMPANIES - DESIGN & BUILD 

35

DESIGN AND BUILD

38

DESIGN SUBSIDIARIES

40

BUILDING SUBSIDIARIES

42

DISTRIBUTION, MANUFACTURING, DESIGN & BUILD

43

GROUP STRUCTURE

44

DIVISIONS & COMPANIES - FINANCIAL HIGHLIGHTS

45

YEAR END FINANCIAL PERFORMANCE MEASUREMENTS 2011-2015

47

FINANCIAL RESULTS & VARIATIONS / OPERATIONAL PERFORMANCE (SR ‘000) 2014-2015

49

FINANCIAL RESULTS & VARIATIONS / FINANCIAL CONDITION (SR ‘000) 2014-2015

50

GEOGRAPHICAL ANALYSIS / REVENUE & NET INCOME 

52

SEGMENTAL INFORMATION

54

STRATEGIC GOALS & FUTURE EXPECTATIONS 

56

ROOTS GROUP GLOBAL SUBSIDIARIES CONTACTS

57

ROOTS GROUP ARABIA ANNUAL REPORT 2015

6


A MESSAGE FROM OUR CHAIRMAN

“ The Significance

of this fiscal year is mostly

highlighted by continued transformational growth and

expansion as we emerge better adjusted to new realities and more

focused on utilization of capital.

�

Tahir Al - Dabbagh Chairman

As Roots Group Arabia celebrates its 35th Anniversary, it is with great pleasure that I present to you its Annual Report of 2015. For me, and for the Board, the significance of this fiscal year is mostly highlighted by continued transformational growth and expansion as we emerge better adjusted to new realities and more focused on utilization of capital. Some realties are indeed challenging, others very promising but all tap into an intrinsic potential for long-term value creation across our three business divisions. Our choice remains to pursue a model that compels us to grow organically and through acquisitions, divest what is weighing our structure down, maintain preferred relationships, and expand our presence in existing and new key international markets. Saudi Arabia continues to be central to our business representing almost 76% of total revenues, posting 77% in net profit for the period ended December 31st, 2015. We remain committed to our successful hybrid model of turnkey fit-out commissions for large projects and partnering with contractors requiring reliable sourcing for their construction needs. Our UK-based Areen Design, Richmond International for high-end hospitality and our latest group member transportation design firm Pascall+Watson have strengthened our Design & Build Division that continues to deliver unique designs and execution of high profile projects. Regionally, we continue to leverage an accrued experience to solidify operation in strong growth centers in UAE and Qatar as preferred suppliers and construction partners. We are investing to drive efficiency, devise new approaches for product sourcing, B2B brand-building, and product innovation.

7

ROOTS GROUP ARABIA ANNUAL REPORT 2015


Throughout 2015, our Manufacturing Division’s production of quality architectural metal and woodworks, suspended ceiling systems, commercial paints, waterproofing, sanitary ware, and power generation solutions continued to perform well. Since acquiring part ownership in Ideal Standard in 2013, the Manufacturing Division represents about 16% of the Group’s total consolidated revenues. The Distribution Division continues to be our strongest, contributing 60% of total revenues in 2015 and predicted to carry through growth as we expand into new markets such as our new operations in Nigeria and Tanzania. Our goal there and elsewhere is to be the best building partner while driving innovation for construction essentials, small and medium size machinery and material handling equipment, industrial supplies, power tools, and construction and finishing material. During the year, we have ramped up product offerings in KSA, UAE, Egypt, and Central Africa as we continue to actively investigate companies, namely in the Far East and Europe that are identified by management for promising opportunities and complementary services to bring into our group or partner with. Our outlook originates from a simple vision to be the best place to work; the best place for our strategic partners to put their trust in; the best place for growth; the best place for our 17,000 plus customers to receive a seamless experience; and the best place for investors to put their money. Year after year we are reminded that this could not be achieved if it weren’t for the commitment and professionalism of our people. It is encouraging to see how hard they work to deliver on our collective vision. Sincerely, Tahir Al-Dabbagh Chairman

ROOTS GROUP ARABIA ANNUAL REPORT 2015

8


A MESSAGE FROM OUR CEO

“ mission Our

has always been to be the

solution provider through a

go-to building

unique insight and close

involvement into the business of construction, its needs,

processes and the tools used within it.

�

Ousama Fansa Chief Executive Officer

Dear Shareholders, Greetings, It is with great pleasure that I address you at the end of a significant year characterized by prioritization and resilience resulting in proof that a great deal can be achieved in turbulent times. As 2016 marks our 35th year in business it is an opportunity to share thoughts on what makes RGA a success and what accounts for our strength as we move towards global presence and consideration to take our group of companies public. I would also like to share with you our outlook for 2016 as we hit the half way point of our fourth decade. In the last two years we have underlined the importance of expanding globally and maintaining key partnerships with the best brands in our industry. We are constantly working to improve service and strengthen local trust. In 2015 we have increased our range of construction and material handling equipment in key markets in Egypt, Jordan, Lebanon and the UAE. We also worked on strengthening our service and aftersales operation and it has continued to grow at a healthy pace. Our mission has always been to be the go-to building solution provider. Through our unique insight and close involvement into the business of construction, its needs, processes and the tools used within it, we have consistently worked to improve delivery of our Manufacturing Division. Our latest achievements are the HAWK generator assembly and power solution plant and a second state-of-the-art A-metal production facility in Jeddah, both became fully operational in 2015. In 2015 we actioned a global expansion plan and took steps to put it into motion. We widened our footprint in longstanding markets and moved into new ones. As we closed the books for 2015, Roots Tanzania was fully operational at the heels of the successful establishment of Roots Nigeria earlier in the year and Roots Jordan now in its third year of business. We have carried out an acquisition that greatly enhanced our design services. We are delighted to have welcomed into our group international design practice Pascall + Watson, celebrating this year 60 years of award-winning projects in the field of transportation. This latest addition falls within our expansion strategy that centers on acquiring stake in profitable companies or partnering with industry leaders to broaden our product and services offerings.

9

ROOTS GROUP ARABIA ANNUAL REPORT 2015


RGA revenues for 2015 reached $983 Million (SAR 3.7 Billion) with a 19% gross profit. The Manufacturing Division has made great strides this year and is expected to continue this trend in 2016. The Distribution Division remains our strongest and with recent market penetration is expected to maintain growth. Revenues from the Design and Build Division have slightly decreased from previous years. In 2016 we aim to build on momentum generated this year to accelerate development and head towards more stable growth. Leveraging enduring regional relationships and a solid infrastructure we seek to invest in international alliances for shared benefits and access to new markets. In line with our strategy to be the construction industry building partner we are vetting complementary business in Europe and the Far East in the fields of industrial products, welding and cutting equipment, wooden furniture and doors, chemical solutions, ceiling solutions, paints, industrial pipes and other like businesses. On behalf of my colleagues on the Executive Committee, I wish to thank our employees for their dedicated efforts. And I would like to thank our customers and other stakeholders, especially our shareholders, for their continuing support. Sincerely, Ousama Fansa Chief Executive Officer

ROOTS GROUP ARABIA ANNUAL REPORT 2015

10


11

ROOTS GROUP ARABIA ANNUAL REPORT 2015


THE ROOTS GROUP / CURRENT BOARD OF DIRECTORS

TAHIR AL-DABBAGH

SALEH BINLADEN

MU’TAZ ALSAWWAF

OSAMA AL-KHERIJI

KARIM SOUAID

HASAN AL-JABRI

BASIM ZIADEH

OUSAMA FANSA

ROOTS GROUP ARABIA ANNUAL REPORT 2015

12


THE ROOTS GROUP / EXECUTIVE MANAGEMENT TEAM Ousama Fansa Chief Executive Officer Mr. Fansa has been Roots Group Arabia’s CEO and serves on the Board of Directors since 2004 Since taking the lead in 2004, Mr. Fansa grew yearly revenues to $1 Billion, a global presence in 12 countries empowered by over 9,700 people. In 2010, he oversaw consolidation and restructuring of the Group’s 30 subsidiaries under the current three divisions’ vertical structure. The leading driver for growth and global expansion, Mr. Fansa is credited with initiating several acquisitions, joint venture and partnerships that grew customer base to over 17,000 worldwide. Mr. Fansa joined RGA in 1986 and grew in the ranks holding several key positions before becoming General Manager in 1994.

Samir Al-Shubaily Deputy Chief Executive Officer Mr. Al-Shubaily’s experience has been instrumental for the integration of the Group’s complementary activities. Mr. Al-Shubaily has accrued over 30 years working in the construction and automotive sectors in KSA. Since joining the Group in 2010, his most significant contribution has been strengthening service delivery within the Saudi market. Company wide, his focal interest and main contribution is in the Distribution and Trade Division.

Nabieh Al-Jehani Chief Financial Officer Mr. Al Jehani oversees the Group’s financial activities Mr. Al-Jehani has over 25 years of financial and leadership experience in the fields of accounting and corporate financial structuring. Having gained his experience working in diverse environments, holding several positions and taking on a wide-range of responsibilities, he has been most effective in the areas of corporate governance and strategic organizational planning.

Ayman Al-Adham Chief of Mergers and Acquisitions In his current function Mr. Al Adham oversees the Group’s M&A activities focusing on strategic finance options and core business development. Coming from the big four audit firms, Mr. Al-Adham joined in 2004 as Group Chief Financial Officer. Investing his vast experience, he assumed several roles including legal, corporate governance and compliance counseling. Following his contribution in the Group’s 2010 restructuring, he was appointed Chief M&A Officer. Mr. Al Adham is also the appointed Corporate Secretary since 2004. 13

ROOTS GROUP ARABIA ANNUAL REPORT 2015


THE ROOTS GROUP / EXECUTIVE MANAGEMENT TEAM Mohammed Al-Ghamdi Director of Human Resources Mr. Al-Ghamdi leads HR functions of RGA’s 9,700 workforce in 30 subsidiaries worldwide. Mr. Al-Ghamdi joined RGA in 2010 bringing over 25 years of experience in HR management. He works on driving implementation of HR policies and procedures, employee relations, Saudization, and other employee-related functions across the Group.

Omar Meqdad Director of Internal Audit M. Meqdad has headed the Group’s internal audit functions since 2010. Mr. Meqdad is a professional internal auditor with over 15 years of experience in banking, retail, communication, and consultancy. His most impactful efforts have been in the areas of control environment and governance structure with respect to firm-wide and business-specific policies, risk assessment, compliance, and internal audit reporting.

Fouad Ghandour Director of Strategy and Development and Managing Director of Roots Pacific In his current capacity Mr. Ghandour is responsible for leading the Group’s strategic expansion in Asia Pacific. Mr. Ghandour works to grow the Group’s international opportunities establishing strategic partnerships, recommending acquisitions, and collaborating with existing businesses in addition to developing Asia Pacific’s regional operations. Mr. Ghandour joined the Group in 1991 when he established Roots Pacific after which he was appointed Far East Director for Business Development.

Fadi Chehab Director of Business Development and Managing Director for Levant and Central Africa Mr. Chehab has led recent expansion into Nigeria and Tanzania underlining the Group’s strategy to grow its global distribution arm. Mr. Chehab joined the Group in 1996 and had been an active member of the Distribution Division. In 2013 he was part of the team who managed the successful acquisition of Ideal Standard and currently sits on its Executive Board of Directors. Previously, Mr. Chehab oversaw acquisition of SOMECO Lebanon and the establishment of Roots Jordan. In his role Mr. Chehab negotiates and maintains strategic alliances with the Group’s International partners including Atlas Copco and Case. ROOTS GROUP ARABIA ANNUAL REPORT 2015

14


ROOTS GROUP ARABIA

15

ROOTS GROUP ARABIA ANNUAL REPORT 2015


OVERVIEW OF ROOTS GROUP Roots Group Arabia is a material supplier and service provider to the construction industry in Saudi Arabia, the GCC, Levant, and Africa. The activities of the Group are organised into three key divisions: Distribution, Manufacturing and Design & Build. For the year ended 31st December 2015, total Group revenues amounted to SAR 3,685 million (pre inter-company eliminations). 1. Distribution, representing 60% (SAR 2,197 million) of the Group’s revenues in 2015, comprising distribution of various building material items such as finishing products, equipment, scaffolding, metal frames and industrial consumables, together with special projects services; 2. Manufacturing of specialised building products, representing, 16% (SAR 597 million) of the Group’s revenues in 2015, comprising metal and woodworks, ceiling systems, power generation solutions and sanitary ware. 3. Design & Build, representing 24% (SAR 891 million) of the Group’s revenues in 2015, providing full turnkey solutions, from interior design to complete fit out activities for high profile construction projects.

DIST

RIBUTION

60 %

IG

N

&B

% UILD

MA

N

NG

16

RI

24

TU

D

ES

%

REVENUE

AC F U

ROOTS GROUP ARABIA ANNUAL REPORT 2015

16


DIVISIONS & COMPANIES - DISTRIBUTION

17

ROOTS GROUP ARABIA ANNUAL REPORT 2015


ROOTS GROUP ARABIA ANNUAL REPORT 2015

18


19

ROOTS GROUP ARABIA ANNUAL REPORT 2015


DISTRIBUTION Roots Group Arabia is one of the Kingdom of Saudi Arabia’s largest wholesale and retail distributor of building materials, power tools, construction and material handling equipment for commercial and residential construction, remodeling and renovation projects. Its product range extends to over 60,000 Items (3,000 items manufactured in house) ranging from nails, covering rails, doors, paints, woodworks, sanitary ware, ceramics, adhesives, generators, power tools, medium and heavy equipment, material handling machinery, scaffolding, and cranes. Distribution Division Product Lines

In-house Brands -- Building materials and architectural finishes manufactured in facilities owned and operated by RGA that includes metal works, furniture and woodworks, ceiling systems, commercial paints, and sanitary.

Imported Brands – Material handling and construction equipment, cranes and scaffolding systems, forklifts, power tools, architectural and construction consumables, and an array of building materials and industrial supplies sourced through worldwide strategic partnerships with best industry brands. This includes CASE, Atlas Copco, Wolffkran, Pilosio, Armstrong, Spit, Jungheinrich, Bosch, GMA Garnett, Häfele and 60 other brands.

 oots Group Exclusive MIMAR Brand -- Building materials, gypsum, nails, finishing products and accessories and R other non-branded building materials.

The Distribution Division benefits from a diversified customer base ranging from large contractors to independent builders in all three provinces of Saudi Arabia. RGA has also developed relationships with leading contractors in the wider MENA region, and Africa and a global network of suppliers that extends through Europe, and the United States. The Distribution Division is the most geographically diversified of the Group with subsidiaries established in 9 of 12 countries in which the Group currently operates. The Distribution Division activities are subdivided into

Wholesale (building materials, power tools and equipment, scaffolding and industrial consumables),

Retail (Gulf Depot)

Special Projects Division-SPD

ROOTS GROUP ARABIA ANNUAL REPORT 2015

20


WHOLESALE Wholesale Distribution operation is managed by a team of highly qualified and experienced sales and marketing professionals, mainly comprised of engineers and construction experts who cover both domestic and regional markets. The team coordinates with large and medium size contractors with regards to their project requirements through each defined stage including planning, pre-commissioning and execution. The Group’s services are designed to meet customers’ needs and requirements supported by a worldwide network of subsidiaries with access to a vast range of products, items and brands that go beyond their actual location. The Group has a presence in key Saudi markets and key regional locations as well as a qualified and specialized team of sales and support personnel. By maintaining integrated procurement and wholesale capabilities, RGA is better equipped to source large and complex orders compared to its closest competitor. In addition to wholesale distribution, the Group offers a full suite of services including training and site assistance, maintenance and parts and after sales support.

Building Materials Since the Group launched its activities in building materials this division has witnessed a large degree of expansion and steady growth. The Company began activity in KSA, then widened its scope to include UAE, Syria, Lebanon, Jordan, Nigeria, Tanzania and Egypt as well as countries in the Far East. The opportunity to expand the building materials segment in recent years is a direct result of the considerable increase in demand for building materials due to rapid expansion of the construction industry in the GCC. RGA building materials product mix includes approximately 26,000 items ranging from stone and masonry fixing systems to ceiling accessories, mastic glues, tile grouts, special epoxies as well as final finishing and architectural products. The Group also distributes its own in-house brand of building materials, in addition to products internationally recognized brands by well-known companies including Armstrong, Hafele, BOS –Best Of Steel, Samsung Staron, Radianz, Lindapter, and many others. The Group has established itself as a complete one stop shop provider for contractors of any size or scale, providing customers with a wide and varied range of building materials with different specifications and prices, from less expensive products, such as bolts and nuts, to more specialized products, such as designed suspended ceilings. In accordance with ISO 9001 standards, the Group carries out rigorous quality testing on all proposed new products before including them in the product range offered to customers.

21

ROOTS GROUP ARABIA ANNUAL REPORT 2015


RGA has increased its focus and capital investment in in-house production through manufacturing facilities with the objective of diversifying and growing its manufacturing capabilities.

Electrical Appliances and Industrial Consumables The portfolio of construction machinery, equipment and power tools distributed by the Group includes Bosch for drilling equipment (Egypt Jordan, Nigeria), Spit power tools (KSA, UAE), Atlas Copco (Lebanon, Jordan, Syria, Nigeria), CASE (KSA, Egypt, Lebanon, Nigeria), Dynapac (Lebanon, Syria, Jordan, Nigeria), Fein (KSA), Skil (Egypt), Haulotte (KSA and Lebanon), Pilosio (KSA), Doosan (KSA, Lebanon), Jungheinrich (KSA, Lebanon, Egypt), Wolffkran (KSA), Chicago Pneumatic (KSA, Egypt, UAE), Liftec Forklifts (KSA), Truemax (KSA) and many others. Furthermore, the Group has established an after sales department within each major sales office in Jeddah, Riyadh, Dammam (KSA), Dubai (UAE), Beirut (Lebanon), Damascus (Syria), Cairo (Egypt), Amman (Jordan) and (Nigeria) providing technical support and after sales services. Industrial consumables include specialized electrical industrial consumer items which the group sells for factories that produce different types of stones including marble, granite, porcelain and ceramics. It also includes the sale of cranes and winches for the transfer of materials and personnel in buildings under construction. Industrial materials, consumables, spare parts and accessories used in such equipment (such as iron filings, polishing stones, cutting and grinding blades and some specialty chemicals are also part of the industrial consumable range of products. The Group’s industrial consumables segment has exclusive agreements with more than 40 international suppliers and manufacturers.

ROOTS GROUP ARABIA ANNUAL REPORT 2015

22


23

ROOTS GROUP ARABIA ANNUAL REPORT 2015


DISTRIBUTION DIVISION WHOLESALE SUBSIDIARIES Mimar for Construction Tools - KSA Wholesale trading in construction equipment and material, sanitary fittings, industrial tools, electrical generators sets and turbines, water filtration equipment, and spare parts related thereto.

Unimar Trading - UAE Trading in building material such as metal products, waterproofing systems and coating and fitting materials.

Unimar Construction Equipment - UAE Trading in power equipment and comprising a wide range of well-respected products such as SPIT tools.

Mimar Trading - Lebanon Agency representation for construction and engineering materials including building and finishing materials, artwork, lighting equipment, electrical equipment and construction garments.

Someco International - Lebanon Import, export and agency distribution of all kinds of heavy equipment, engineering and building materials, electrical generators and turbines and related spare parts. The company distributes and represents several top brands such as CASE, Dynapac, Atlas Copco, Haulotte and Doosan.

Mimar Syria for Trading & Contracting - Syria Import, export and distribution of all kinds of construction and building materials. The company sells many well-known products in Syria such as Armstrong, Ferriera Dicitadella, Atlas Copco and Dynapac.

Arabian Roots for Manufacturing & Trading - Jordan Trading in construction division (RCE Road Construction Equipment, APE Portable Compressors, CTO Hand-held Concrete and Light equipment).

Roots Group Pacific - Malaysia Trading in building material and furniture including ceramics, porcelain, mosaics, granites, gypsum board and artwork.

Roots - China Representative office for Roots Pacific Malaysia trading in building material and furniture including ceramics, porcelain, mosaics, granites, gypsum board and artwork.

Unimar Trading - Egypt General import and export activities and more specifically construction and material handling equipment, management and consulting services for industrial projects.

Roots Equipment & Material - Nigeria Trading in RCE road construction equipment, APE portable compressors, CTO hand-held concrete and light, Bosch and CASE CE (CASE construction).

Roots Group Tanzania - Tanzania Trading in RCE road construction equipment, APE portable compressors, CTO hand-held concrete and light, and CASE CE (CASE construction).

ROOTS GROUP ARABIA ANNUAL REPORT 2015

24


RETAIL (GULF DEPOT) Mindful of a growing consumer segment within KSA looking for easy and quick access to quality interior and exterior building material, power tools and equipment, Roots Group entered the retail market in 2002 through the hardware retail concept store of Al Makhzan or Gulf Depot. The Gulf Depot retail chain was developed around the needs of medium and small consumers, independent contractors, craftsmen and home improvement do-it-yourselfers looking for quality, comprehensive and value-wise collection of building materials ranging from light tools and equipment, building supplies and electrical tools, medium size machinery and vans for their commercial and residential projects. Our retails outlets ranging in size from 50 to 500 m2 are strategically located across all the Kingdom’s provinces. Currently operating 40 outlets in 11 cities throughout KSA, RGA is now offering franchising opportunities of its Gulf Depot retail outlets across the entire Middle East region. The Gulf Depot network distributes exterior and interior building materials, including the Group’s in house branded products as well as products sourced from major manufacturers in Asia, the US and Europe. Gulf Depot uses the Group’s central logistics facility to manage its distribution channels. It maintains a fleet of vehicles, including small vans and delivery trucks. MIMAR Brand Mimar is RGA’s construction arm established 15 years ago and carrying out quality construction projects in KSA and the GCC. The MIMAR brand value has over the last decade extended to include a vast range of quality tools and building material produced for RGA and exclusively sold in Gulf Depot stores. The MIMAR brand of products carries RGA guarantee for quality.

25

ROOTS GROUP ARABIA ANNUAL REPORT 2015


SPECIAL PROJECTS DIVISION – SPD Through a vast network of resources and relationships Roots Group established in 2008 the Special Projects Division (SPD) for added value delivery to a demanding regional client base. Each client has unique requirements best served by SPD’s purchasing & procurement team qualified to provide time-effective, reliable and high-quality solutions to those needs. Accuracy, integrity and reliability are demonstrated in each and every project, earning SPD an unparalleled reputation with both manufacturers of FF&E and OS&E as well as clients’ architectural consultants and on-site engineering supervisors. SPD uses a plethora of suppliers from marble producers in Italy, to fabrics and textile mills in the UK, to antique dealers in France and Holland, to rare furniture artisans in Sweden and the US. This process requires that SPD fully understands the detailed plans including architectural and engineering aspects thereof, and familiarizes itself with the nature and composition of such items. SPD applies a combination of deep expertise, powerful information and tools and proven processes to their services, as follows:

OUTSOURCING DESIGN

PROJECT INITIATION

TRANSACTION MANAGEMENT

IMPLEMENTATION

PROJECT DELIVERY

Through its Design & Build Division, the Group is often awarded design and execution of high-end projects including palaces, luxury residences, five star hotels, universities, and public and private buildings. Installation and execution is typically conducted by the Group’s contracting companies (MIMAR International KSA and MIMAR Projects in Qatar and UAE, Top Factory, and MASCO), thereby creating an efficient and vertically integrated D&B Division. Since its establishment, the Special Projects Division has executed projects in Saudi Arabia and the GCC. Most notable projects include King Abdul Aziz International Airport in Jeddah, correctional centres, Central Command Building, the strategic project to develop the Ministry of Interior, the Holy Haram Expansion Project, and a number of educational projects including King Saud University, in addition to projects in Senegal and Morocco. Special Projects Division Services

Management of contracts for design services

 anagement of procurement of materials and equipment including furniture, lighting fixtures, fabrics, decorative M items and other related items per scope of work and specifications

Management of financial relationship with the international suppliers with respect to material and equipment

ROOTS GROUP ARABIA ANNUAL REPORT 2015

26


DIVISIONS & COMPANIES - MANUFACTURING

27

ROOTS GROUP ARABIA ANNUAL REPORT 2015


ROOTS GROUP ARABIA ANNUAL REPORT 2015

28


29

ROOTS GROUP ARABIA ANNUAL REPORT 2015


MANUFACTURING The Manufacturing Division produces approximately 3,000 items traded through the Group’s channels and other distributors. The in-house manufacturing of own branded products such as A Metal, MIMAR products, and Ideal Standard MENA has enabled increased control over the entire product supply chain, quality and customer service. Products manufactured include metalwork, stainless steel cladding and metal domes, mechanical fixing systems, dry wall and suspended ceiling systems, and woodworks including customized wood finishes and furniture. The Manufacturing Division has developed leading expertise and knowledge in a range of technologies enabling design of innovative new uses.

ROOTS GROUP ARABIA ANNUAL REPORT 2015

30


METAL ARTWORK SAUDI COMPANY (MASCO) MASCO is one of RGA’s first manufacturing subsidiaries responsible for design and production of custom-made metal and brass finishes. MASCO services cover the design and production of decorative and architectural metal work for buildings and large projects. MASCO provides full execution and installation services for projects carried out by RGA ’s Design &Build subsidiaries. MASCO manufactures all types of cast iron and copper items including sanitary covers, pipes, connectors and related sanitary fittings. Landmark projects contracted to MASCO since 1990 include the expansion of the Two Holy Mosques in Makkah and Madinah. MASCO has also carried out implementation of special metal construction works for luxury hotels, palatial residences, hospitals, airports and shopping malls. In 2009, the MASCO plant underwent complete overhaul of all equipment and machinery with the introduction of the latest state-of-the-art automatic machinery. In addition to developing all factory divisions MASCO established MOFAC branch in Riyadh in 1996. MASCO is an ISO-certified production plant committed to top performance and industry best practices. The company has supplied and implemented metal contracting works for a large number of projects in Saudi Arabia most of which are large-scale projects with special specifications including the King Abdullah University of Science and Technology, Raffles Hotel and King Saud University.

SAUDI ALLIED METAL INDUSTRIES (SAMI / A-METAL) A-Metal offers a unique line of standard and customized masonry fixing systems, ceiling systems and fasteners. A-Metal is an established supplier in Saudi Arabia, the UAE, Syria, Lebanon and Egypt having consistently increased regional market share through broad dealer network in established market and new ones such as Morocco, Bahrain, Cyprus, Qatar, Oman and Turkey. Pursuant to a tireless willingness to expand product range and keep up with increased orders, A-Metal’s second ISO-certified production plant in Jeddah became fully operational in 2015. A-Metal employs a qualified technical staff of designers, agents, and customer service representatives who works around the clock to enhance customers’ satisfaction and meet all their requirements.

31

ROOTS GROUP ARABIA ANNUAL REPORT 2015


TOP FACTORY Top Factory provides a wide range of custom-made timber-based and solid surface products including cabinets, wooden doors, chairs and tables, windows, wall panels, ceiling and hand rails. The plant also manufactures furnishing including bedrooms, dining rooms, and other household and living furniture and decorative woodworks. Since it was acquired in 2008, the company has supplied and implemented highly specialized wooden contracting works for a number of large scale projects in KSA including the King Abdullah University of Science and Technology, Raffles Hotel, and King Saud University.

HAWK Hawk Power Generation is a joint venture between Roots Group Arabia and SAKR Group (founded in Lebanon in 1972) single source power generation solution provider for a wide scope of services covering design, engineering, manufacturing, sales, testing , installation, commissioning, after sales service, warranty, and rental of power generating sets and the implementation of turnkey power projects. HAWK Power Generation Scope of Solutions  ower Generation sets from 1 to 5,000 KV A Diesel medium speed P and high speed  ower Projects on a turnkey basis up to operation and maintenance P contract Power Rental Solutions Sourcing from leading suppliers in power generation : MBH Cummins; Mitsubishi and Lister Petter high speed engines; GE Transportation for medium speed diesel engines; MBH HFO and gas engines; MBH, Marathon and Stamford AC Alternators. HAWK operates out of a 23,000 m2 manufacturing facility in Jeddah serving the Saudi Arabian market, Kuwait, Oman, Bahrain, Syria, Egypt, Algeria and four African countries. The JV offers standard and customized power generating sets suitable for standby/emergency power, prime power or continuous applications which can run diesel, gas, heavy fuel oil and dual fuel. Delivering fast and efficient service is one of HAWK’s top priorities. HAWK’s service branches offer 24/7 service by expert teams of engineers and technicians.

ROOTS GROUP ARABIA ANNUAL REPORT 2015

32


IDEAL STANDARD Ideal Standard (IS) is a world renowned sanitary and bathroom brand. Headquartered in Brussels, Belgium, IS operates independently in Europe, Middle East and Africa as well as in Latin America. With bathroom solutions as its core business, the company provides bathroom furnishings, fixtures and shower enclosures for residential, commercial and institutional buildings. Its products are sold under its strong international brands Ideal Standard, Jado and American Standard, Incesa Standard, Armitage Shanks, Ceramica Dolomite, Porcher and Vidima. The company employs over 11,000 people. In 2013, Roots Group expanded its product offering when it invested capital for stake in IS Middle East and North African (IS MENA) operations of IS International. The transaction was completed in the last quarter of 2013. IS MENA Ownership Ideal Standard International Holding SARL Roots Group Arabia Ideal Standard International SA

49% 40% 11%

IS MENA is based in Dubai with core production carried out in 6 factories in Egypt employing over 2,000 people. Since acquiring stake in IS MENA the group’s total consolidated Manufacturing Division revenue contribution have increased from 8 % of total revenues to 15 % in 2015. Ideal Standard: A Unique Position  ost recognized brands across mid- to high-end ceramics, fittings M and acrylics #1 position and brand awareness in Europe and the USA  stablished footprint for ceramics across MENA ranking among top E international brands Unique high quality and cost competitive supply Six state of the art production plant in Egypt (80%) Supply agreement with IS Europe (20%) Clear strategy to establish regional leadership Resilient Egyptian market insures scale to grow profitably Investment opportunity in new manufacturing capacity, especially in mid-range ceramics and assembly of brass fittings

33

ROOTS GROUP ARABIA ANNUAL REPORT 2015


Product Portfolio Ceramics Manufacturing facility established in 1983 produces more than 20 models of ceramics bathroom range. Production processes for material testing, slip and glaze preparation, casting, drying, spraying, firing and testing to final stages of packaging and storing are performed under strict quality standards and manufacturing best practices. Products receive IS International grade A quality and lifetime guarantee. Brass Fittings  The brass fittings plant was established in 1987 to achieve a more integrated production process. It produces a variety of stylish models of brass fitting with ceramic-disk technology in order to provide leak-free faucets. More than 40 models are produced for bathroom and kitchen. Bathing & Wellness In 1986, IS began manufacturing acrylic bathtubs, whirlpools and enclosures through a third production unit. Over 350 models of whirlpools, bathtubs and shower trays are produced. Processes used include vacuum-forming and hand sprayed fiberglass resin backing. The plant’s production of whirlpools and shower cabinets is mainly devoted for export. 80% of the bulk of production is exported to Europe, the Middle East and Africa where ISI products are in high demand for their unique innovation and stylish design. To accommodate the continuous high demand for a wide range of Acrylic products, a second acrylic bathtub plant was built and has been operational since 2006. The expanded facility is built over 12, 000 m2, designed and equipped with new production lines and modern technology. Shower Enclosures Shower enclosure manufacturing facility in 2004 to cope with increasing regional demand and to increase line range. Acrylic Sheets  In 1999 a feeding plant was established to produce acrylic sheets of different thicknesses, colours and opacity shades. It is a one of a kind acrylic sheets producer in Egypt & Middle East as well as the first acrylic plant owned by ISI. Acrylic sheets are specially formulated acrylics intended for the sanitary ware industry. They are suited for thermoforming of bathtub, spas, shower trays and bath panels. Easily shaped, they retain superior strength, and high glossiness. The tough thermoplastic material they are made of is used to mould a variety of household and commercial products easily, dependably and economically.

ROOTS GROUP ARABIA ANNUAL REPORT 2015

34


DIVISIONS & COMPANIES - DESIGN & BUILD

35

ROOTS GROUP ARABIA ANNUAL REPORT 2015


ROOTS GROUP ARABIA ANNUAL REPORT 2015

36


Aviation Profile

37

ROOTS GROUP ARABIA ANNUAL REPORT 2015


DESIGN AND BUILD Under the Design & Build Division the Group provides distinguished design and build services part of larger projects or as turn-key contract. D&B services include designing and planning the project from initial concept, identifying materials, arranging all procurement, transport and clearance procedures, as well as affixing and completing all finishing works. Roots Group plays an active role by entering into contracts with suppliers and contractors, assuming the roles of designer, planner and project manager for the built phase. The D&B Division provides an additional ‘route to market’ for the Distribution and Manufacturing Divisions to supply projects with building materials, construction tools and equipment solutions. D&B’s most recent projects in KSA include Princess Nora University, the King Abdullah Endowment Fund, King Saud University and King Abdullah University of Science and Technology, and the King Abdul Aziz International Airport. Other global commissions include the Britannia Cruise Ship, Heathrow Airport Terminal 2A, Black Friars Station, The Four Seasons Moscow, Hilton Opera Paris, and Zayed University in Abu Dhabi. The Group has developed proprietary procurement systems which it employs to expedite the sourcing process allowing the client greater flexibility in design variation throughout the project. Design and built contracts also provide the ability to appoint subcontractors, apportion separate contractual responsibility to specialized contractors and a better grip over delivery schedules. Building and fit out services include shop drawings, cost estimates and value engineering, execution of all fit-out works, interiors and façade lighting, factory visits, pre-production prototypes, finish samples and mock ups, project management and site supervision, safe handling, transportation, storage and precise installation of all FF&E, OS&E, and artwork.

ROOTS GROUP ARABIA ANNUAL REPORT 2015

38


39

ROOTS GROUP ARABIA ANNUAL REPORT 2015


DESIGN SUBSIDIARIES AREEN DESIGN SERVICES Areen Design Services is owned by Gandolphe Interiors Holding Limited (Gandolphe). Subsidiaries of Gandolphe comprise entities responsible for design that were acquired by the Group starting 2009. These include Areen Design Services Limited, Richmond International and Pascall+Watson Limited (acquired in 2015). All three design subsidiaries are based and operating in the United Kingdom. Gandolphe subsidiaries

 reen Design is a full service UK-based interior design practice specializing in high end palaces, airports, hotels, A universities, with a strong focus on procurement services, furniture sourcing and project management.

Richmond International is a design practice for international luxury hospitality for over 45 years.

 ascall + Watson is a market leader in transportation and airport terminal design with a broad portfolio of university P buildings, offices, hotels, industrial parks, museums and residential projects.

Together Gandolphe subsidiaries have designed interiors for hospitality, educational, healthcare, transport, civic and commercial, and residential projects. The subsidiaries source, purchase and commission furniture, fixtures, equipment and all other moveable items that comprise the interior of a building. Gandolphe subsidiaries specialize in master planning, feasibility studies, architecture, furniture, fixtures and equipment, interior design, procurement, project management, design co-ordination, construction and turnkey projects. Although the activity of these three companies overlap, they work separately targeting different types of clients.

areenaviation areencivic&cultural areencommercial areeneducation areenhealthcare areenhospitality areenresidential

Hotel & Leisure Design Consultancy

RIBA Registered Architects

London

London Abu Dhabi

London Jeddah

ROOTS GROUP ARABIA ANNUAL REPORT 2015

40


41

ROOTS GROUP ARABIA ANNUAL REPORT 2015


BUILDING SUBSIDIARIES Roots Group has established and acquired a number of subsidiaries and holdings for its construction arm in Saudi Arabia, UAE and Qatar. These subsidiaries and holdings are responsible for providing construction services to customers, including the fitting out and installation of furniture and architectural finishes. MIMAR INTERNATIONAL FOR DEVELOPMENT - KSA One of RGA’s largest building subsidiary undertaking general construction commissions and high standard finishing works for hotels and high profile establishments including palaces, universities, residential complexes, mixed-use buildings, malls, and conference centers. It also provides project management services. MIMAR PROJECTS FOR CONTRACTING - UAE Similar activities to those carried out by MIMAR International, primarily general construction works and high profile finishes. It also carries out entire housing projects (turnkey). MIMAR PROJECTS FOR CONTRACTING - QATAR Founded in 2009 as a contracting company executing high profile finishing activities, with a specific focus on medium size projects. SAUDI UNITED FOR WATERPROOFING AND CONCRETE REPAIR - KSA SUW carries out contracting works for waterproofing, thermal insulation and concrete repairs.

UAE

QATAR

ROOTS GROUP ARABIA ANNUAL REPORT 2015

42


DISTRIBUTION, MANUFACTURING, DESIGN & BUILD SUBSIDIARIES

PRINCIPAL ACTIVITIES OF THE COMPANY

% OWNED COUNTRY OF INC.

Gulf Depot for Building Materials

Trading in building materials

100%

MIMAR for Construction Tools

Trading in building equipment and materials 51% and industrial tools

Saudi Arabia

UNIMAR Trading

Trading in building materials

100%

UAE

Unimar Construction Equipment

Trading in building materials

50%

UAE

Arabian Roots for Manufacturing and Trading

Trading in building materials, constructions Machinery and equipment

60%

Jordan

MIMAR Trading

Trading in building materials

100%

Lebanon

Someco International

Trading in building materials

70%

Lebanon

Someco International Offshore

Offshore trading and building materials

70%

Lebanon

MIMAR Offshore Project

Procurement services to projects

100%

Lebanon

Roots Egypt for Equipment

Construction equipment

100%

Egypt

Al Aswak Al Mutahida Al Masriyah

Import, export, agencies & marketing activities 80%

Egypt

MIMAR Syria for Trading and Contracting

Trading in building materials

100%

Syria

Roots Group Pacific

Trading in building materials

100%

Malaysia

Roots Group China

Trading in building materials

100%

China

Roots Equipment and Material

Trading in building materials, constructions Machinery and equipment

60%

Nigeria

Roots Group Tanzania

Trading in building materials, constructions Machinery and equipment

95%

Tanzania

Saudi Allied Metal Industries

Production of stainless steel products

55%

Saudi Arabia

Metal Artwork Saudi Company

Production and trading in metal and brass artworks and cast iron sanitary items

75%

Saudi Arabia

Top Factory Company for Furniture & Wooden Decorations

Manufacturing furniture and wood works.

100%

Saudi Arabia

Hawk Power Generation

Power generation solutions including manufacturing, sale and rental of power generating.

55%

Saudi Arabia

Ideal Standard MENA

Production of sanitary and bathroom solutions

40%

Gibraltar

Property investment and Development, operation and maintenance of buildings

100%

Saudi Arabia

Saudi United for Waterproofing and Concrete Repair Water proofing and concrete repairing

50%

Saudi Arabia

Gandolphe Interiors Holding Limited

Interior design services

100%

UAE

MIMAR Projects for Contracting

Design and management of construction projects, general, mechanical and electrical

100%

UAE

MIMAR Projects for Contracting

Design and management of construction projects, general, mechanical and electrical

70%

Qatar

DISTRIBUTION Saudi Arabia

MANUFACTURING

DESIGN & BUILD MIMAR International for Development

43

ROOTS GROUP ARABIA ANNUAL REPORT 2015


GROUP STRUCTURE RGA is a majority owner of 30 operating companies. These companies are strategically placed around the world to maximize RGA’s success and ability to deliver. Headquartered in KSA, Roots Group Arabia is constantly working on strengthening the growth and development of its operations and presence in other markets.

The latest acquisitions to strengthen the RGA business are in the UK, Egypt and Lebanon. These new businesses play major roles helping the Group to achieve internal and external goals and contribute to continuing and success. Aside from extending our service offering, satisfying both domestic and international customer demands, the Group’s presence in these new locations has strengthened its financial position.

(Egypt)

Gulf Depot (KSA)

100%

100%

100%

100%

70%

MIMAR Projects for Contracting (UAE)

100%

50%

22%

100% 75% 55% 55% 40%

MIMAR Syria for Trading & Contracting Company (Syria) Roots Group Pacific (Malaysia)

Gandolphe Interiors Holding Ltd. (UAE)

Roots Equipment & Material Ltd. (Nigeria) Roots Group Tanzania Ltd. (Tanzania)

Roots Group (China)

100%

Al Aswak Al Mutahida Al Masriyah (Egypt)

Ideal Standard MENA (Gibraltar)

100%

Roberts Paints (Egypt) / (Associated)

MIMAR International for Development Co.(KSA) Saudi United for Waterproofing & Concrete Repair (KSA)

Mimar Projects for Contracting (Qatar)

100%

Roots Egypt for Equipment

Hawk Power Generation (KSA)

Empower Contracting (Associated)

Areen Design Group (UK)

60%

Mimar Offshore (Lebanon)

Saudi Allied Metal Industries (KSA)

95%

Someco Int. Offshore (Lebanon)

Tools (UAE)

50%

Someco International (Lebanon)

Unimar Const.

80%

Mimar Trading (Lebanon)

Metal Artwork Saudi Co. (KSA)

DESIGN & BUILD

30%

100% 100%

Arabian Roots for Manufacturing & Trading (Jordan)

100%

Unimar Trading (UAE)

60%

Mimar for Const. Tools (KSA)

100%

Top Factory Company for Furniture & Wooden Decorations (KSA)

70%

Roots Group Arabia (KSA)

70%

MANUFACTURING

100%

DISTRIBUTION

51%

GROUP STRUCTURE

ROOTS GROUP ARABIA ANNUAL REPORT 2015

44


DIVISIONS & COMPANIES - FINANCIAL HIGHLIGHTS

45

ROOTS GROUP ARABIA ANNUAL REPORT 2015


ROOTS GROUP ARABIA ANNUAL REPORT 2015

46


YEAR END FINANCIAL PERFORMANCE MEASUREMENTS ALL AMOUNTS IN SAR’000

2011

REVENUE

2,831,052

OPERATING INCOME

285,051

339,384

NET INCOME

243,950

247,216

TOTAL ASSETS

2,032,659

3,060,008

EQUITY

739,473

917,829

221,614

342,942

347,226

339,384

285,051

3,296,211

33%

3,659,794

3,436,668

2,503,946 ROOTS GROUP ARABIA ANNUAL REPORT 2015

2,831,052

35%

RETURN ON EQUITY

47

2012 2,503,946

REVENUE

OPERATING INCOME

The Group has recorded strong and continued growth in revenues; the increase was 13% from 2011 to 2012. 2013 witnessed a further increase of 21% over 2012, despite economic uncertainty and unrest in the Middle East. In 2014, the revenue experienced a growth of 6.5% over 2013. But 2015 witnessed a drop of 10% over 2014 amid challenging economic situation of KSA.

In line with revenue, operating Income also saw healthy growth; increase was 19% from 2011 to 2012. 2013 witnessed a further increase of 3% over 2012. Operating income slightly dropped by 1% as compared to 2013 and experienced a sharp decline of 35% in 2015 mainly due to a drop in revenue and increase in costs.


2011-2015 2013

2014 3,659,794

347,226

342,942

221,614

259,608

268,119

85,492

3,999,168

4,157,088

4,650,240

879,179

1,026,489

1,136,035

3,296,211

12%

30%

34%

33%

35%

2,032,659

85,492

3,060,008

4,650,240

12%

4,157,088

3,999,168

30%

268,119

259,608

247,216

34%

243,950

2015

3,436,668

NET INCOME

TOTAL ASSETS

RETURN ON EQUITY

The Group’s net income also recorded upward trend in line with revenue. It registered an increase of 1% from 2011 to 2012 and 2013 witnessed a further increase of 5% over 2012. 2014 registered an increase of 3.5% over 2013, while 2015 witnessed a sharp decline of 68% which goes in line with a drop in operating income.

Total assets have been increasing year on year, marking a 49% increase in 2012. 2013 witnessed an additional increase of 32% while for 2014, these increased by 4%. 2015 registered a further increase of 12%.

Return on equity has been calculated as net income before minority interest over total equity. Return on equity stood at 33% in 2012 compared to 35% in 2011. It rose to 34% in 2013 before closing at 30% in 2014. It stood at only 12% for 2015 mainly due to severe drop in net income.

ROOTS GROUP ARABIA ANNUAL REPORT 2015

48


FINANCIAL RESULTS & VARIATIONS / OPERATIONAL PERFORMANCE (SR ‘000) 2014-2015 ALL AMOUNTS IN SAR’000

34

11

REVENUES

GROSS PROFIT

32

0, 2 59

1 42,6 4 6

4

OPERATING INCOME

8%

NET INCOME BEFORE ZAKAT AND NON-CONTROLLING INTEREST

-68%

11

19%

-55%

8

6

INCOME TAX

Growth% 2 01 4 2 01 5

49

ROOTS GROUP ARABIA ANNUAL REPORT 2015

48 4 4,8 3 0 ,4 8 7

NON-CONTROLLING INTEREST

,1 1

9

,3

7

8, 6

268

NET INCOME

8 5 ,4 9 2

2, 94 2 22 1, 6 1

4, 0 63 9 8 9 ,2 61

5

9, 79 3,2 4 9 6 ,2

-35%

-10% 71

3, 6

-10 %


FINANCIAL RESULTS & VARIATIONS / FINANCIAL CONDITION (SR ‘000) 2014-2015 ALL AMOUNTS IN SAR’000

88

8%

57 40 ,0 8 8

,12 2,9 4 1 4 4 3 ,1 6 6 ,2

6

3,6 0 1,2 0 0

1, 4 1

12%

4,1 2 , 50

3,

4, 6

8% 8

CURRENT ASSETS

TOTAL ASSETS

12% 3,1 3 0, 5 3 ,5 1 4 ,2 0 5

CURRENT LIABILITIES

11% 99

TOTAL LIABILITIES

1 1,1 , 0 2 6 , 4 8 9 3 6, 03 5

TOTAL EQUITY

These diagrams show the variance of the key elements of income statements & balance sheets for 2015 compared to 2014.

ROOTS GROUP ARABIA ANNUAL REPORT 2015

50


51

ROOTS GROUP ARABIA ANNUAL REPORT 2015


GEOGRAPHICAL ANALYSIS / REVENUE & NET INCOME The chart below details the Group’s Revenue excluding and including Other Operations by geographic region. 2015

Far East

361,617 9,800

Europe

200,507

GCC

53,925

Saudi Arabia

3,059,639

Total Revenue excluding Other Operations

3,685,488

Revenue from Other Operations (IS MENA Middle East & GCC)

342,356

Total Revenue including Other Operations

4,027,844

Middle East

9.81 %

REVENUE (SAR ‘000)

The diagram shows this as a percentage of overall Revenue excluding Other Operations by year.

% 44 5.

1.46%

2015

83.02%

The diagram shows this as a percentage of overall Revenue including Other Operations by year. 0.24%

The chart below details the Group’s Net Income excluding and including Other Operations by geographic region. NET INCOME (SAR ‘000)

0.27%

13.36%

4.98% 5.46%

2015

Middle East

2015

Far East

25,194 25

Europe

(2,616)

GCC

(3,127)

Saudi Arabia

66,016

Total Net income excluding Other Operations

85,492

Net Income from Other Operations (IS MENA Middle East & GCC) * Total Revenue including Other Operations

75.96%

The diagram shows this as a percentage of overall Net Income including Other Operations by year.

-

-3.06%

-3.66%

29.47%

85,492

0.03%

2015

All figures shown are in SR ‘000.

77.22%

- Other Operations represent results of IS MENA * Share of net income from IS MENA is included in net income from operations

ROOTS GROUP ARABIA ANNUAL REPORT 2015

52


53

ROOTS GROUP ARABIA ANNUAL REPORT 2015


SEGMENTAL INFORMATION WHOLESALE / RETAIL / TRADING

MANUFACTURING

DESIGN AND BUILD

ELIMINATIONS / RECLASSIFICATION

TOTAL FROM OPERATIONS

OTHER OPERATIONS

TOTAL ASSETS

3,228,760

1,378,808

1,245,651

-1,202,978

4,650,240

-

TOTAL LIABILITIES

3,069,093

823,077

825,013

-1,202,978

3,514,205

-

3,514,205

REVENUES

2,207,570

587,013

890,905

-389,277

3,296,211

342,356

3,638,566

GROSS PROFIT

370,158

102,892

166,211

0

639,261

98,905

738,166

NET INCOME *

65,323

6,394

13,775

0

85,492

-

85,492

WHOLESALE / RETAIL / TRADING

MANUFACTURING

DESIGN AND BUILD

ELIMINATIONS / RECLASSIFICATION

TOTAL FROM OPERATIONS

OTHER OPERATIONS

TOTAL ASSETS

3,138,555

565,190

1,223,820

(770,476)

4,157,088

617,884

4,774,972

TOTAL LIABILITIES

2,728,895

344,754

827,427

(770,476)

3,130,599

269,224

3,399,823

REVENUES

2,712,122

362,189

1,197,647

(612,164)

3,659,794

629,891

4,289,685

GROSS PROFIT

427,287

45,660

241,151

-

714,098

177,274

891,372

NET INCOME *

177,400

15,833

74,886

-

268,119

-

268,119

DEC 31/2015 (SR ‘000)

DEC 31/2014 (SR ‘000)

SR ‘000

2014/2015

WHOLESALE / RETAIL / TRADING MANUFACTURING DESIGN AND BUILD OTHER OPERATIONS

REVENUE

TOTAL ASSETS

2014/2015

TOTAL LIABILITIES

3,138,555

2,728,895

2015

3,228,760

3,069,093

2014

565,190

344,754

2015

1,378,808

823,077

2014

1,223,820

827,427

2015

1,245,651

825,013

2014

617,884

269,224

2015

-

-

GROSS PROFIT

2014/2015

NET INCOME

4,650,240

TOTAL

2014/2015

2014

2014/2015

TOTAL

2014/2015

2,712,122

427,287

177,400

2,207,570

370,158

65,323

362,189

45,660

15,833

587,013

102,892

6,394

1,197,647

241,151

74,886

890,905

166,211

13,775

629,891

177,274

-

342,356

98,905

-

ROOTS GROUP ARABIA ANNUAL REPORT 2015

54


55

ROOTS GROUP ARABIA ANNUAL REPORT 2015


STRATEGIC GOALS & FUTURE EXPECTATIONS Diversify Earnings, Clients

and

Suppliers

Maintain a strategy of global growth Strengthen presence in regional markets Diversify product range and services with no over-reliance on any single supplier and/or product Maintain a Client base exceeding 18,000 customers with new customers driven by acquisitions

International Expansion

in

New Growth Areas

Replicate RGA’s business model in emerging market geographies and continue targeting the African continent Maintain a global strategy to be the building industry’s single source provider of all their construction needs

Growth Initatives Expand manufacturing base for specialty products and industrial consumables mainly in Europe Broaden retail distribution arm serving professional craftsmen and small contractor segments Offer franchising opportunities of Home Depot Develop RGA private-label products Launch new brands under various proprietary through existing sales channels

ROOTS GROUP ARABIA ANNUAL REPORT 2015

56


ROOTS GROUP GLOBAL SUBSIDIARIES CONTACTS Saudi Arabia

United Arab Emirates

Roots Group Arabia Co. Ltd

MIMAR International for

Mimar Projects for General

Dammam Branch

Development Ltd.

Contracting LLC

P.O. Box 30390, Al Khobar 31952

Royal Plaza, Prince Sultan Street,

Al Mansouri Building Office No. M01,

Khalidya, Dammam

Al Nahada

Al Najdah Street

Kingdom of Saudi Arabia

P.O. Box 5393, Jeddah 23615

Abu Dhabi, United Arab Emirates

T +966 3 749 1385

Kingdom Of Saudi Arabia

T + 971 2 635 3785

F +966 3 859 5329

T +966 12 234 7500 Ext.294

F + 971 2 635 3784

E sislam@arabian-roots.com

F +966 1 2 608 0663

E contact@mimarprojects.com

Roots Group Arabia Co. Ltd

E mimarinternational@arabian-roots.com Saudi United For Waterproofing

LLC / Unimar Trading Co.LLC

Amir Metab Street, Old Industrial Area

Oash Center, Al Baterji Street East,

Bin Bishr Building, Abo Hail Street, Deira

P.O. Box 4193, Riyadh 11531

Salamah

P.O.Box 55368, Dubai

Kingdom of Saudi Arabia

P.O.Box 13211, Jeddah 21493

United Arab Emirates

T +966 1 448 2164

Kingdom of Saudi Arabia

T + 971 4 269 8769

F +966 1 448 2165

T + 966 12 627 8444

F + 971 4 269 9123

E ntoukatly@arabian-roots.com

F + 966 12 683 1170

E Info@unimartrading.com

Metal Work Saudi Company (MASCO)

E info.suw@ikkgroup.com

Ideal Standard MENA

SBG Industrial Estate, Bahra

Roots Group Arabia Head Office

Jafza View 18 Building

P.O. Box 127007, Jeddah 21352

Royal Plaza, Prince Sultan Street, Nahda

Office Number LB 182604

Kingdom of Saudi Arabia

P.O.Box 52269, Jeddah 21563

P.O. Box 261559

T +966 12 289 4816

Kingdom of Saudi Arabia

Jebel Ali Free Zone, Dubai, UAE

F +966 12 289 4816

T +966 12 234 7500

E IdealStandardGulf@idealstandard.com

E info@metalartplus.com

F +966 12 234 7455

Top Factory

E info@arabian-roots.com

Industrial City, Zone 4

Gulf Depot Head Office

P.O.Box 42595, Jeddah 21551

Royal Plaza, Prince Sultan Street, Al Nahda

Kingdom of Saudi Arabia

P.O.Box 126527, Jeddah 21352

T +966 12 636 0626

Kingdom of Saudi Arabia

E admin@topfactory.com

T +966 12 234 2685

Saudi Allied Metal Industries (A-Metal) Industrial Estate, Zone 4, Street No.408

F +966 12 234 2687 E info@gulf-depot.com

P.O.Box 3711, Jeddah 21481

Hawk Power Generation

Kingdom of Saudi Arabia

Royal Plaza, Prince Sultan Street, Al Nahda

T +966 12 6080327

P.O.Box 52269, Jeddah 21563

F +966 12 6080663

Kingdom of Saudi Arabia

E secretary@ametal.com.sa

T +966 12 699 6739 F + 966 12 622 8144 E info@hawkpg.com

57

Unimar Construction Equipment Co.

Riyadh Branch

ROOTS GROUP ARABIA ANNUAL REPORT 2015

Egypt Unimar Egypt 20 Markaz Khadamat Al Aswak Al Mutahida, Tagmoa Al Awal New Cairo, Egypt T + 22 2 2247 8072 F + 22 2 2247 8075 E boschegypt@unimaregypt.com

Qatar Mimar Project for General Contracting Palm Tower B, Floor 46 No. 4602 P.O. Box 32424 Doha, Qatar T +974 4 434 2411 F +947 4 434 2412 E contact@mimarprojects.com


Lebanon

Nigeria

UK

Mimar Trading SAL

Roots Equipment and Material Ltd.

Areen Design Services

Soubra Building, Verdun Ain El Tineh

Plot 769 EDU, Industrial Area

23 Eyot Gardens

P.O. Box 136239 Shouran

FCT Abuja, Nigeria

London, W6 9TR

Beirut, Lebanon

T +234 706 778 2624

T +44 (0)20 8748 8088

T +961 1 790 422

E nigeria@arabian-roots.com

F +44 (0)20 8748 3475

F +961 1 867 212 E mtg@dm.net.lb SOMECO International SAL SOMECO Building, Dora Highway P.O. Box 136239 Shouran Beirut, Lebanon T +961 1 253 600 F +961 1 260 353

E contact@areen.com

Tanzania Roots Equipment and Material Ltd. E nigeria@arabian-roots.com

Malaysia

E info@somecointernational.com

Roots Pacific Malaysia

Mimar Offshore MOP

UOA Center 19 Jalan Pinang

Soubra Building, Verdun Ain El Tineh

Kuala Lumpur 50450, Malaysia

P.O Box 135903

T + 603 2164 5481

Beirut, Lebanon T +961 1 792 401 F +961 1 867 212 E mimar@mimarlb.com

Jordan Roots Arabia Jordan Al Sharif Nasser Bin Jamil Street Building No. 37 P.O Box 942181, Al Rabiea Amman 11194, Jordan T +962 6 554 5778 F +962 6 554 5779

Business Suite 19A-31-2, Level 31

F + 603 2164 5478 E info@rootspacific.com

Richmond International 12 Carthusian Street London, EC1M 6EB T +44(0)20 7490 1901 F +44 (0)20 7490 4474 E sarah.rawlinson@richint.com Pascall+Watson The Warehouses 10 Black Friars Lane London, EC4V 6ER T +44 (0)20 3837 2500 F +44 (0)20 3837 2600 E info@pascalls.co.uk

China Roots Pacific China Suite 2312, Tower C, World Finance Centre No. 4003, Shennan East Road, Louhu District Shenzen 518000, China T + 86 755 2221 4998 F +86 755 2221 4698 E info@rootspacific.com

Syria Mimar Syria for Trading & Contracting Saleh Al Ali Street Bazerbashi Building, Mazraa Damascus, Syria T +963 11 224 0112 F +963 11 245 8983 E mimar.syria@hotmail.com ROOTS GROUP ARABIA ANNUAL REPORT 2015

58


59

ROOTS GROUP ARABIA ANNUAL REPORT 2015


ROOTS GROUP ARABIA ANNUAL REPORT 2015

60


Roots Group Arabia Royal Plaza | Prince Sultan Street | Nahda District P.O. Box 52269 | Jeddah 21563 | Saudi Arabia T +966 12 2347500 | F +966 12 2347455 E info@arabian-roots.com | W www.rootsgroup.org

Roots Group Arabia Annual Report 2015  
Roots Group Arabia Annual Report 2015  

The Construction Industry Full Scale Solution Partner Roots Group Arabia is leading presence in the construction sector providing customers...

Advertisement