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Transforming for the journey ahead

Annual Report 2019

Financial highlights

Revenue (SAR)

0 bn
bn
2019 Progress bar 2.16bn
2018 Progress bar 2.04bn
2017 Progress bar 1.95bn

Pay-out ratio

0 %
%
2019 Progress bar 98.1%
2018 Progress bar 99.1%
2017 Progress bar 94.5%

Net profit after Zakat and Income Tax (SAR)

0 m
m
2019 Progress bar 463.9m
2018 Progress bar 459.3m
2017 Progress bar 481.7m

Earnings per share (SAR)

0
2019 Progress bar 5.66
2018 Progress bar 5.60
2017 Progress bar 5.87
Financial highlights

Chairman’s Statement

It gives me great pleasure to present the Annual Report of the Saudi Airlines Catering Company for 2019. Being the first year of our term as a new Board, I would like to thank all our predecessors for the invaluable foundations they established, which have enabled SACC to reach the leadership position it occupies today in our sector.

During the past year, SACC has made important strides in its journey of transformation and improvement, while delivering significant growth and diversification.

Our strategy as a Board is now focused on diversifying our revenue streams in the F&B sector, while reducing our dependence on in-flight catering. Geographical expansion beyond our boundaries is also a current priority.

Despite challenging headwinds, our company is evolving to maximize the value we deliver for our shareholders, customers and the nation, mirroring the process of rapid positive change being felt across the Kingdom as a whole.

Revenue (SAR)

0 bn
bn

Earnings per share (SAR)

0

In the face of ongoing market turbulence, SACC generated SAR 2.156 billion in revenue and a net profit of SAR 463.9 million in 2019, representing an increase of 1% over 2018 and resulting in an earnings per share of SAR 5.66.

Mohammed Abdulaziz Al Sarhan Chairman
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Our strategy as a Board is now focused on diversifying our revenue streams in the F&B sector, while reducing our dependence on in-flight catering.”

Chairman's Statement
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Transforming our journey

SACC is on a strategic journey of expansion and diversification.

Over the last 39 years, we have built a proud legacy and lasting partnerships, charting an ambitious path while transforming for the future in order to build on our strengths and deliver sustainable growth and profitability for years to come.

Our corporate transformation and integration accelerated in 2019, digitizing business support functions and reengineering processes to enhance efficiency and establish a strong foundation for accelerated growth and profitability in the future.

Year in Review
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0

people will be catered
for every day

Ecomerce icon
0 %
%

revenue growth in
e-commerce retail sales

Hajj icon
0

meals served in Hajj
and Umrah unit

Our Journey

SACC is on a strategic journey of expansion and diversification.

Our Journey
1981

Inception of SACC by Saudi Arabian Airlines at King Abdul Aziz International Airport in Jeddah

1983

Launch of Riyadh operations in Cairo International Airport

1984

Launch of Egipatian operations in Cairo International Airport

1985

Takeover of Skysales

1999

Launch of Dammam operations in King Fahad International Airport

2001

Launch of Madina operations in Prince Mohammad Bin Abdulaziz Airport

2006

Takeover of Alfursan lounges

2007

Royal Decree for privatization

2008

Privatization and establishment of SACC as a limited liability company

Launch of non-airlines support services, later renamed Catering & Facilities

2011

Conversion to a joint stock company following a decision of the Minister of Commerce & Industry Launch of Central Production Unit (CPU) in Riyadh

Image of plane
1981

Inception of SACC by Saudi Arabian Airlines at King Abdul Aziz International Airport in Jeddah

1983

Launch of Riyadh operations in King Khalid International Airport

1984

Launch of Egyptian operations in Cairo International Airport

1985

Takeover of Skysales

1999

Launch of Dammam operations in King Fahad International Airport

2001

Launch of Madina operations in Prince Mohammad Bin Abdulaziz Airport

2006

Takover of Alfursan lounges

2007

Royal Decree for privatization

2008

Privatization and establishment of SACC as a limited liability company

Launch of non-airlines support services, later renamed Catering & Facilities

2011

Conversion to a joint stock company following a decision of the Minister of Commerce & Industry Launch of Central Production Unit (CPU) in Riyadh

2012

Initial Public Offering (IPO) of SACC on Tadawul stock exchange

2013

Launch of Saudi Laundry Services (SLS) in Riyadh

2014

Launch of Skysales e-commerce via www.skysalesonline.com

Signing of first rail contract for services onboard

Extension of Saudia contract for 5 additional years

2015

Introduction of electronic bidding system for food items

Opening of Skysales shops in KSA airports

2016

Strategic partnership with leading European duty-free group

Lagardère Launch of state-of-the-art laundry facility in King Abdullah Economic City (KAEC)

Introduction of Wellcome Lounge concept in King Khalid International Airport Terminals 1 & 2

2017

Opening of first international Saudia Alfursan lounge in Cairo International Airport

2018

Initiation of digital transformation program

2019

Extension of Saudia contract for 10 additional years

Entrance into the Sport & Entertainment sector through a catering and sponsorship agreement for Rally Dakar Saudi Arabia 2020

Signing a new 10 year contract with Saudia to design, build and operate the domestic Alfursan Lounge in Jeddah’s new Airport

airplane image
1981

Inception of SACC by Saudi Arabian Airlines at King Abdul Aziz International Airport in Jeddah

1983

Launch of Riyadh operations in King Khalid International Airport

1984

Launch of Egyptian operations in Cairo International Airport

1985

Takeover of Skysales

1999

Launch of Dammam operations in King Fahad International Airport

2001

Launch of Madina operations in Prince Mohammad Bin Abdulaziz Airport

2006

Takeover of Alfursan lounges

2007

Royal Decree for privatization

2008

Privatization and establishment of SACC as a limited liability company

Launch of non-airlines support services, later renamed Catering & Facilities

2011

Conversion to a joint stock company following a decision of the Minister of Commerce & Industry Launch of Central Production Unit (CPU) in Riyadh

2012

Initial Public Offering (IPO) of SACC on Tadawul stock exchange

2013

Launch of Saudi Laundry Services (SLS) in Riyadh

2014

Launch of Skysales e-commerce via www.skysalesonline.com

Signing of first rail contract for services onboard

Extension of Saudia contract for 5 additional years

2015

Introduction of electronic bidding system for food items

Opening of Skysales shops in KSA airports

2016

Strategic partnership with leading European duty-free group Lagardère

Launch of state-of-the-art laundry facility in King Abdullah Economic City (KAEC)

Introduction of Wellcome Lounge concept in King Khalid International Airport Terminals 1 & 2

2017

Opening of first international Saudia Alfursan lounge in Cairo International Airport

2018

Initiation of digital transformation program

2019

Extension of Saudia contract for 10 additional years

Entrance into the Sports & Entertainment sector through a catering and sponsorship agreement for Rally Dakar Saudi Arabia 2020

Signing a new 10 year contract with Saudia to design, build and operate the domestic Alfursan Lounge in Jeddah’s new Airport

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2012

Initial Public Offering (IPO) of SACC on Tadawul stock exchange

2013

Launch of Saudi Laundry Services (SLS) in Riyadh

2014

Launch of Skysales e-commerce via www.skysalesonline.com

Signing of first rail contract for services onboard

Extension of Saudia contract for 5 additional years

2015

Introduction of electronic bidding system for food items

Opening of Skysales shops in KSA airports

2016

Strategic partnership with leading European duty-free group Lagardère

Launch of state-of-the-art laundry facility in King Abdullah Economic City (KAEC)

Introduction of Wellcome Lounge concept in King Khalid International Airport Terminals 1 & 2

2017

Opening of first international Saudia Alfursan lounge in Cairo International Airport

2018

Initiation of digital transformation program

2019

Extension of Saudia contract for 10 additional years

Entertainment sector through a catering and sponsorship agreement for Rally Dakar Saudi Arabia 2020

Signing a new 10 year contract with Saudia to design, build and operate the domestic Alfursan Lounge in Jeddah’s new Airport

Transformation Roadmap

Our corporate transformation and integration accelerated in 2019, digitizing business support functions and reengineering processes to enhance efficiency and establish a strong foundation for accelerated growth and profitability in the future.

Transformation Roadmap
icon 7 Functions
icon 35 Full time equivalent project members
icon 150 Workshops
icon 4 Phases
Lines
Digital transformation initiation

In 2018, the transformation of procurement began. By 2019, the Finance, HR, Logistics and IT were also undergoing transformation.

2019
SAP
  • Transformation kick-off
  • S/4 HANA
  • C/4 HANA
  • FICO
  • HCM
  • KRONOS
  • SAP ARIBA
  • SUCCESSFACTOR
  • IS RETAIL
7

Operating models developed

275

Processes developed

2020

Retail operating model development

2021
  • S/4 HANA
  • HCM
  • KRONOS
  • IS RETAIL
  • GO-LIVE
Divider line
2022 Change management program
Current digital platforms
  • UCAS 1
  • UCAS 2
  • AMLAS
  • MS DYNAMICS
  • Oracle Fusion
Accenture Consultancy

was awarded the development of SACC transformation’s operating models, processes, policies and procedures.

Functions covered by SAP
  • Finance
  • HR kick-off
  • Procurement & Strategic Sourcing
  • Logistics
  • On-ground Retail
  • Online Retail
Other digital platforms available
  • Legal +
  • Laserfiche
  • Talentera

SAP implementation kick-off

  • C/4 HANA
  • GO-LIVE
  • SAP ARIBA
  • GO-LIVE
  • SUCCESSFACTOR
  • GO-LIVE
Current digital platforms
  • UCAS 1
  • UCAS 2
  • AMLAS
  • MS DYNAMICS
  • Oracle Fusion
Digital transformation initiation

In 2018, the transformation of procurement began. By 2019, the Finance, HR, Logistics and IT were also undergoing transformation.

Accenture Consultancy

was awarded the development of SACC transformation’s operating models, processes, policies and procedures.

SAP
  • Transformation kick-off
  • S/4 HANA
  • C/4 HANA
  • FICO
  • HCM
  • KRONOS
  • SAP ARIBA
  • SUCCESSFACTOR
  • IS RETAIL
Functions covered by SAP
  • Finance
  • HR kick-off
  • Procurement & Strategic Sourcing
  • Logistics
  • On-ground Retail
  • Online Retail
  • Other digital platforms available
  • Legal +
  • Laserfiche
  • Talentera
7

Operating models developed

275

Processes developed

SAP implementation kick-off
Retail operating model development
C/4 HANA GO-LIVE
SAP ARIBA GO-LIVE
  • S/4 HANA
  • HCM
  • KRONOS
  • IS RETAIL
  • GO-LIVE
Slider line
  • SUCCESSFACTOR
  • GO-LIVE
2022 Change management program
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CEO’s Statement

Given the many achievements of the past year, 2019 will come to represent a pivotal moment for Saudi Airlines Catering Company, particularly in light of the rapid changes and reforms being driven by the Saudi Government across all areas of our business.

Net profit after Zakat and Income Tax (SAR)

0 m
m

Net profit margin

0 %
%

Our customers are growing and their needs are changing, reflecting new patterns of tourism, passenger flows and consumer spending

trends, as well as unprecedented opportunities for travel and entertainment that are changing entire industries in the Kingdom.

As a major source of support for these rapidly evolving sectors, our response must be even faster. In order to maintain our leading market position – and to continue delivering the quality services that we are known for – we must become a more agile and innovative organization that is prepared to drive change rather than merely adapt to it.

Wajdy Al-Ghabban Chief Executive Officer
CEO's Statement
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Business Model
Page numbers

inputs

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  • Financial
  • Capital allocation
  • Assets
  • Cash
  • Debt
  • Physical
  • Land
  • Infrastructure
  • Equipment
  • Technology
  • Human
  • Workforce
  • Expertise
  • Leadership
  • Procurement
  • Social and relationship
  • Government
  • Partnerships & JVs
  • Community
  • Customers

what we do

Arrow icon
In-flight catering

Our core in-flight catering business has a long track record of success based on scale, quality and consistency, working to world-class standards of health and safety in food production.

Retail

Our growing retail business sells thousands of food and non-food products to customers in the air on multiple carriers, on the ground across Saudi Arabia, and through dedicated e-commerce platforms.

Catering & Facilities

Our Catering & Facilities business provides a broad range of services to clients in four key sectors – business and industry, remote sites, education and healthcare.

how we generate revenue

Arrow icon

Long-term contracts with national airline carriers; catering for international airlines, private jets and charter flights; airport lounges and airline equipment.

Long-term contracts with national carriers for onboard sales; strategic ground shops; e-commerce sales.

Catering and other services that supply airlines, trains and hotels; large-scale catering contracts for businesses, remote sites, events, and Hajj and Umrah.

outputs

Arrow icon
  • Financial
  • Dividends
  • Return on investment
  • Capital appreciation
  • Physical
  • Retail shops
  • Lounges
  • Infrastructure
  • Human
  • Staff training & development
  • Retention
  • Saudization
  • Employer of choice
  • Performance-driven-culture
  • Social and relationship
  • Social responsibility/
    sustainability
  • Brand trust and equity
  • Trusted partner
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In-Flight Catering

Saudi Airlines Catering Company is the leading airline catering and ancillary services provider in the Kingdom of Saudi Arabia.

Our In-Flight Catering division delivered strong performance across the board in 2019, increasing revenues and profitability by providing efficient, high-quality services across the kingdom to 106 airlines clients from around the world.

Number of meals

0 m
m

Number of flights served

0
In-Flight Catering
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Retail

Saudi Airlines Catering Company entered the retail sector in 1984 with the launch of SkySales, Saudia’s prestigious in-flight retail service.

Our Retail division has seen tremendous expansion, diversification and synergies across our business over the last 35 years and, facing strong macroeconomic and demographic headwinds in 2019, we refocused our footprint towards more profitable areas while driving exponential eCommerce growth to better serve our loyal customer base.

Number of retail shops

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m

Number of products on skysalesonline.com

0
Retail
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Catering & Facilities

Established in 2008 to drive growth and diversify revenue, the SACC Catering & Facilities division leverages the company’s strong expertise in the field of food management and catering to provide services to public and private organizations and industries across the Kingdom.

During the year, we integrated additional business lines under the division, driving increased services and enhanced experience for customers while delivering higher returns and cost efficiency for the company.

Catering & Facilities
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