What changes has the company experienced under your leadership?
The company required a great deal of restructuring as it had been neglected for various reasons. It had accumulated losses of SAR59 million and no dividends had been paid since 2006 due to these losses. In the first year we brought in the right talent, identified the right contracts, sold the old fleet, and bought new ones. With God's help and plenty of hard work and support from everyone involved, we were able to turn that around within a year. In 2013 we paid about SAR18 million in dividends, which represents 10% profit per share. After that we had about SAR6 million-7 million in retained earnings. The company was making SAR44 million in terms of revenue but a million or two in net profit from other non-operational income. In 2015 we made about SAR375 million in revenue and about SAR52 million in net profit. The strategy was to diversify our revenue stream, and we stuck to it. You cannot put a goal in place and expect to go in a straight line; there will always be obstacles and challenges. You have to keep your eye on the ball and maneuver until you get there. It is about not giving up and making sure that you persevere and enjoy the benefits of getting the results.
Could you describe your strategies in achieving this diversification?
In the second year, we implemented the whole restructuring process and got the finances on track. The following year, we acquired Amnco, which was part of the strategy of diversification: growth through acquisitions. Saudi Arabia is still a cash society, and banks require cash transport, cash movement, and feeding ATMs. We identified this as an opportunity from the beginning, but it was not the right time when we first took over management. It became the right time after we had established a firm foundation for the company. It is still part of logistics but a different line. Amnco operates in cash management and the transportation of precious metals and precious stones, such as gold and diamonds. Amnco was only focused on the Saudi market; we signed an agreement with Brinks that allowed it to expand into Saudi Arabia and, in return, allowed Saudi Arabia to open up to the rest of the world. This was a big jump for Amnco, and we now work with Brinks to transport gold and currency from outside Saudi Arabia into the country. Today, Amnco operates in certain parts of the GCC, whereas Mubarrad covers the entire GCC within the transport sector. We used to cover Turkey as well, but because of the current geopolitical situation, we cannot go to places like Turkey, Syria, or Lebanon. We look at companies that have potential at a good price and do the same thing: We restructure them. That is exactly what we have done over the past three years.
What are your expansion plans?
We try to limit our contracts to certain companies to avoid expanding too fast in terms of the refrigerated transport sector. Now, we pick our clients ourselves so we can give them the best possible service, whereas in the past it was a case of picking up any contract that came along. We are now selective and focused so that we can provide better service. We are always expanding; however, I would rather expand by 10-15% than jump into 40-50%. It is costly to make such a jump, as you have to buy the truck heads and trailers. You then have to bring in qualified drivers and it takes about two months to train them to the company's standard. The expansion is steady but we do not like zigzagging; we like to stick to 10-15%. We are always looking at integrating services to expand. We are looking at the oil and gas sector. We have to approach things carefully, and we need to have the correct level of expertise before we enter any each sector.