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Cenomi to dispose of more brands in journey to black

Cenomi brands Aldo is one of an additional five brands Cenomi Retail's board agreed to dispose of Alamy via Reuters Connect
Aldo is one of the brands that Cenomi Retail's board agreed to dispose of
  • Accumulated losses hit SAR1.5bn
  • 52% drop in profit
  • Share price down 22%

The Saudi franchiser Cenomi Retail has agreed to sell more non-core brands as part of a programme to draw the company back into the black.

At an extraordinary general meeting on Monday, shareholders gave the go-ahead for more sell-offs from the company’s portfolio of non-core assets, which was worth SAR2 billion ($530 million) when the programme was first started in 2022, to tackle mounting losses.

As part of the programme, the company sold 16 brands in the first quarter of 2024 and transferred 226 stores in Saudi Arabia to Abdullah Al Othaim Fashion Company. 

The transfer came after Cenomi’s exit from some international markets and the net closure of 219 stores in 2023.

The retailer reported a 52 percent drop in net profit for the second quarter. Accumulated losses increased from SAR1.4 billion at the end of 2023 to SAR1.5 billion as of June 30 this year.

Cenomi Retail’s share price has dropped almost 22 percent in the year to date.

Board members previously approved the sale of an additional five brands – Aldo, Aldo Accessories, Pedro, La Vie en Rose and Charles & Keith – and 121 stores to Abdullah Al Othaim Fashion Company in a deal worth SAR219 million plus inventory.

Cenomi, which had 75 brands in its portfolio before it began the divestment programme, said it would end up with just 13. It plans to focus on so-called “global champions” in the fashion and food and beverage sectors, such as Zara.

Earlier this month Cenomi Retail appointed Salim Fakhouri as its CEO. He had been acting CEO since March this year.