Saudi Company for Hardware (SACO) [4008.SE] reported earnings of SAR28.1 million in 1Q2016, declining c17% Y-o-Y (-26% sequentially), partly on a high-base comparison, as 1Q2015 revenue growth of c35% Y-o-Y was bolstered by the two-month King-ordered bonus. Revenue for the quarter came in at SAR303 million, inching down c2% Y-o-Y. Gross margin narrowed 170bps Y-o-Y to 19.8%  on higher operating costs while EBIT margin contracted a slighter 140 bps to 10.3%, as SG&A expenses fell 5% on lower general expenses. Accordingly, gross profit fell c10% Y-o-Y to SAR60.1 million, while operating profit dropped 14% to SAR31.2 million. On another note, the company’s board of directors (BoD) has proposed a SAR1.5 cash dividend for 1Q2016, implying a payout ratio of 130% and an annualised yield of 7.1% (Company disclosure)