Middle East businesses see 6.3% revenue growth in 2024 despite liquidity hurdles
Businesses in the Middle East have shown steady financial progress in 2024, with stronger revenue growth and better working capital management. A new report highlights improvements in profitability, inventory efficiency, and cash flow—though many firms still struggle to maintain long-term gains.
Revenues for Middle Eastern companies climbed by 6.3 per cent in 2024 compared to the previous year. This growth builds on an 11.5 per cent compounded annual increase since 2020, reflecting a broader upward trend.
Profitability also edged higher, rising by 30 basis points. The region's non-oil sectors drove much of this improvement, with the UAE's non-oil revenue jumping 16.8 per cent and Saudi Arabia's growing by 8 per cent. Working capital performance saw notable gains as well. Net working capital (NWC) days improved by six days—a 5.6 per cent reduction—while Days Inventory Outstanding (DIO) fell by three days. Days Sales Outstanding (DSO) also dropped, from 83.9 days in 2023 to 81.1 days in 2024. Despite these advances, only 9.4 per cent of firms managed to sustain working capital improvements for three years in a row. The report also estimates that publicly listed companies in the region have $54.7 billion tied up on their balance sheets, underscoring ongoing challenges in liquidity management.
The 2024 figures suggest that Middle Eastern businesses are making progress in efficiency and revenue growth. However, the low percentage of firms maintaining consistent working capital gains points to persistent hurdles. Effective cash flow management remains a key focus for companies aiming to unlock trapped capital and strengthen financial stability.
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