Higher top line vs lower bottom line.
CGC recorded a 9% growth yoy in its Q3- 2016 revenue to KWD60m (vs. KWD55m Q3-2015). On a qoq terms, revenues also went up by around 7%. The company has also improved its Q3-2016 gross margin Compared to Q2 (5.22% vs. 4.83% in Q2) but it is still far from what is recorded in Q3 2015 (8.03%). The 9M 2016 gross margin also improved to 4.39% (vs. 3.98% in H1 2016) but it is also still far from last years’ 6.9% gross margin.The company also improved its EBITDA margin on a quarterly basis to 6.23% (4.35% in Q2) amounting c.KWD3m, 54% higher than Q2 2016, and 25% higher than Q3 2015. Nonetheless, H1 2016 negatively weighted the company’s 9M EBITDA which decreased by 13% comparing to the same period last year.
The company’s 9M 2016 financial charges jumped by 69% compared to the same period last year to KWD1.6m.
The bottom line was affected by the company’s financial charges even though the company managed to record a net profit for the 2nd consecutive quarter after a net loss in Q1 2016. The company recorded a 9M net profit of c.KWD0.6m, 16% lower than 9M 2015.
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