Oriental Weavers, an Egypt-based carpet manufacturer led by leading business executive Yasmine Mohamed Khamis, saw its profit drop by more than 39 percent to less than $24 million at the end of the first nine months of its 2022 fiscal year owing to a rise in raw material costs as well as increases in both production costs and operating expenses.
Despite a double-digit 13-percent increase in revenue from EGP7.4 billion ($302.6 million) to EGP9.5 billion ($388.5 million), the group’s profit fell by 39 percent during the first nine months of the current fiscal year, from EGP960 million ($39.3 million) in the previous period to EGP583 million ($23.9 million).
The double-digit percent decline in the company’s profit could well be attributed to a 13-percent increase in the cost of oil-based raw materials combined with lower volumes, resulting in higher unabsorbed costs for the group as management continues to focus on strengthening its worldwide market positioning.
To mitigate the impact of the recent spike in raw material costs on earnings, management is actively pursuing restructuring plans and operational re-engineering to reduce both fixed and variable costs, as well as establishing a pricing strategy with alternative product offerings.
Oriental Weavers is one of the world’s largest manufacturers of machine-made carpets, with production facilities in three countries.
Egyptian businesswoman and executive Yasmine Mohamed Khamis and other Khamis family members own a 56.58-percent controlling interest in the leading carpet manufacturer, which sells its products in approximately 150 countries throughout the world.
Oriental Weavers’ shares were trading at EGP7.6 ($311 million) a share, with a market capitalization of EGP5.05 billion ($206.5 million) at the time of writing. This is 26 basis points more than the Egyptian Exchange’s starting price this morning.
The Khamis family’s share in the group is worth EGP2.86 billion ($117 million) at today’s market price.
