Complex Made Simple

NREC announces 9-month 2015 financial results

Net profit of KWD 11.6 million, second highest year-to-date earnings in five years

National Real Estate Company KPSC, one of the leading real estate companies in the Middle East and North Africa (MENA) region today announced its financial results for the nine months period ending September 30, 2015.

The company reported KWD11.6 million in net profit for the period, making the company’s year-to-date earnings its second highest in five years.

9-Month 2015 Financial Highlights:
●Operating Revenues of KWD14.8 million versus KWD14.7 million for the same period in 2014
●EBITDA of KWD14.4 million; EBITDA margin of 57.8% versus 54.9% for the same period in 2014
●Net Profit (Equity Holders) of KWD11.6 million
●Earnings Per Share (EPS) of 12.97 fils
●Total Assets of KWD565.5 million; increased by KWD12.5 million from December 2014
●Shareholders’ Equity of KWD212.0 million; increased by KWD12.1 million from December 2014

NREC is a regional pioneer in real estate investment, development and property management. The company’s portfolio of rental and sale properties includes malls, office towers, residential complexes and resorts in Kuwait, Egypt, Jordan, UAE, Lebanon, Iraq and Libya.

NREC CEO Mr. Samuel Sidiqi said, “We are pleased to announce that we’ve recorded our second highest earnings over a five-year period despite the political and security challenges in some of our markets; proving once again that our well-diversified MENA-wide portfolio shields the company from market volatilities while taking advantage of the long-term opportunities that the region presents.”

He added, “We continue to make strong progress growing our business across all segments and key geographies. Results from our Grand Heights development in Egypt were in line with our expectations and reflect a strong Egyptian real estate market. Revenues for the nine-month period from our Egyptian subsidiary grew 8.5% y-o-y to KWD6.5 million. Strong rental income flows from our domestic operations continued with revenues at KWD7.8 million, a 4.6% growth over the same period last year.”

“Our plans to construct Reem Mall in Abu Dhabi are rapidly advancing. We have recently signed a contract for enabling works and have issued a tender for the main contract works in order for construction to begin early next year. Reem Mall will set a new standard of retail excellence among Abu Dhabi malls when completed in second half of 2018,” he concluded.

Update on Developments and Investments in YTD 2015
●In Kuwait, rental income recorded KWD7.8 million, representing an increase of 4.6% from the same period last year. Average occupancy was buoyant at 98%.
●At the Grand Heights development outside of Cairo, revenues grew by 8.5% to KWD 6.5 million in 9M 2015. Unit prices and overall market demand remain robust at the premium residential development. The project sold 739 units as of September 30th with a total sales value of KWD92.7 million. Partial handover of Phase 1 is expected early next year.
●Reem Mall, a $1 billion project in Abu Dhabi, will consist of more than 420 stores, including 85 restaurants, a large format hypermarket and an unparalleled breadth of entertainment and leisure offers. Reem Mall has recently signed a contract with the enabling contractors and will shortly commence with the enabling works. Kuwait-based UPAC will be investing up to $224 million into the project. Construction is expected to start in early 2016.
●In Jordan, revenues increased 26% y-o-y to KWD 805,000. Rents and demand remain stable at the 1.5 million square-meter Aqaba Warehousing and Industrial Park property.
●In Libya, NREC continues to monitor geopolitical developments as it relates to its investment in the Palm City residential project.