The Company posted an increase in total revenue by 22% YoY, to SAR 8.8 billion supported by business growth across all key business lines. Strong performance was led by 30% growth in Core ICT Services (to SAR 4.77 billion), which accounted for 54% of revenue in 2022. Other business lines also performed well, with 19% growth in IT Managed and Operational Services (to SAR 2.330 billion), and 7% growth in Digital Services (to SAR 1.704 billion).

solutions by stc's customer segment consist of a) Business-to-Business (B2B), where sales are conducted either through stc or directly to customers, ranging from government and semi-government institutions, to large and small-scale private sector entities; and b) Sell-to-stc where stc is the end customer.

In 2022, B2B sales recorded 17% growth, and comprise a 69% share of total revenue. These reflect the Company’s keen focus on developing this area of business and leveraging opportunities for growth in the SME segment.

Our parent company, stc, continued to be an anchor customer for solutions by stc during 2022. 31% of revenues were generated from sales to stc, up from 28% the previous year. A substantial portion of revenue generated from stc can be directly attributed to the large data center project booked in early 2022. Synergies with stc also played a significant role in helping solutions by stc to expand its customer base through introductions to new government and private sector institutions.

This year, our B2B sales channel contributed 69% towards total revenue, reflecting the strength and competitiveness of solutions by stc’s infrastructure, products, services, and the Company’s renewed focus on excellence in customer experience.

As part of Vision 2030, the Saudi government brought into effect several digitalization initiatives, which translated into sales opportunities for solutions by stc. Overall, the B2B segment added close to SAR 6.04 billion in revenue during the year, a 17% increase YoY.

These figures also reflect the Company’s increased focus on new industries and sectors particularly within the SME category. The private sector SME segment is historically underserved in the region, and presents significant opportunities for growth in the future.

In 2022, solutions by stc’s net profit margin increased to 12.0% from 11.6%, due to the inherent seasonality of its project-based business. For the same reason, its EBIDTA margin similarly increased to 15.8% in 2022 from 15.4% the previous year.

Overall operating expenses increased 5% YoY on the back of Giza acquisition-related expenses, partially offset by lower sales and distribution expenses.

* Total Equity before deducting non-controlling interest of SAR 28,890,452.

During 2022, the Company's Total Assets increased by 43.35% to SAR 10,282 million, from SAR 7,173 million the previous year. The increase is primarily due to short-term Murabaha financing amounting to SAR 2,701 million and an increase in Accounts Receivables to SAR 4,345 million resulting in a healthy level of working capital management.

The Company's Total Liabilities increased by 52.16% to SAR 7,459 million in 2022, compared to SAR 4,902 million the previous year. This reflects the Company's
short-term borrowings of SAR 194 million and long-term borrowings of SAR 502 million during the year under review.

Total Equity increased 24.33% to SAR 2,823 million in 2022. Up from SAR 2,271 million the previous year. The increase reflects the Company's profit and non-controlling interest for the year.

solutions by stc concluded 2022 on an extremely positive note with several successes throughout the year. The Company reached a number of critical milestones that led to a strong overall financial performance, leaving it well positioned to maintain a positive trajectory and achieve its future goals for growth.

Abdulrahman Alrubaia
Chief Financial Officer