Alandalus Property, a pioneering Saudi real estate company involved in the investment, development and operation of income-generating properties across the country, said its net profit for the first quarter remained steady at SR20.3 million ($5.4 million) compared to SR20.5 million.
 
Announcing its interim financial results for the period ended March 31, 2019, the company said its revenue remained relatively flat at SR40 million compared to SR40.8 million for the same period last year.

The minor dip in revenue was primarily due to a slight drop in occupancy at the Staybridge Hotel in Jeddah, an asset within the company’s hospitality segment, it stated.

Alandalus Property said its gross profit was SR23.6 million, a 4.8% decrease from SR24.8 million the same period last year, as a result of one-off higher operating fees and utility costs associated with the food court of Alandalus Mall.

The company reported marginal growth in operating profit to SR29.1 million from SR28.9 million which was driven by its prudent approach to expense management and from increases in other revenue.

On the results, Chief Financial Officer Fawaz bin Huwail said: "We are pleased that we have been able to maintain our operating profit at the same level as that of last year. It is worth noting that the slight drop in net profit attributable to shareholders is mainly driven by the initial impact from our adherence to IFRS 16 on Leasing Contracts."

"It is commonly understood that, in relative terms, implementation of this new standard adversely impacts a Company’s stated income - particularly in the earlier periods of a given  lease contract represented as interest expenses on lease liabilities," stated bin Huwail.  

Operationally, in March 2019 Al Marwa Center - the Company’s newest community mall in Jeddah - opened its doors to the public. With almost 10,000 sqm of gross leasable area (GLA) and a 65% occupancy rate, the retail property consists of a hypermarket and 31 strategically selected line shops.

Al Marwa Center is a joint venture between Alandalus Property and Al-Rajhi & Sons Investment Company.

CEO Hathal Al Utaibi said: "Given the enhancements we are making to our properties, especially in the retail sector, I am pleased with our financial performance."

"Al Marwa Center coming online will further boost our top line and reflects our commitment to create compelling consumer destinations differentiated by highly engaged visitors,." he added.-TradeArabia News Service