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Aug 21
Majid Al Futtaim recorded an increase in its revenues for the first half of 2023, by 5%, to reach 18.9 billion dirhams, and an increase in its profits before interest, taxes, depreciation and amortization by 13% on an annual basis, to reach 2.1 billion dirhams.
The company witnessed growth at the level of all business units, supported by its operational efforts, and the high performance indicators of the UAE economy in general. The company continues to maintain a strong balance sheet, with assets valued at around AED 68 billion.
Ahmed Galal Ismail, CEO of Majid Al Futtaim Holding, said: “The company has succeeded in achieving a balance between strategic growth and profitability, according to a responsible executive framework. Through our efforts to drive our set targets at the business portfolio level and our continued focus on achieving operational excellence and productivity, we have succeeded in achieving sustainable growth, in parallel with achieving profits, and delivering value to our shareholders.”
Ismail added: “The resilience and strength of the UAE economy played a prominent role in achieving these ambitious results, in addition to our efforts to unlock the full potential of our business system, which was reflected positively on the company’s strong financial performance in the first half of this year. The company will continue to advance its strategic options to create value that meets the various aspirations of our customers across the region.”
Real estate
Majid Al Futtaim Properties reported an increase in net revenues of 39% year-on-year to reach 3.4 billion dirhams, while EBITDA increased by 22% and reached 1.7 billion dirhams, driven by the activities of shopping centers in the UAE and the performance of the development project. Real estate «Tilal Al Ghaf».
The demand for visiting shopping centers increased by 12%, driven by the Mall of the Emirates, which recorded the highest number of visitors ever in the first half of this year.
Tenant sales grew by 7%, with shopping malls in the UAE accounting for the largest proportion of this growth. Hotels also remained flat with occupancy rates and RevPAR increasing by 3% and 2%, respectively.
The “Tilal Al Ghaf” project continued its strong sales during the first half of this year, and this included record sales of luxury villas in the “Lanai Island” neighborhood, and the completion of the construction of 916 housing units, which contributed strongly to achieving sustainable growth in the real estate business.
hash
As a result of the depreciation of the currencies in the scope of the company’s business presence, the total revenues decreased by 2% to reach 14.1 billion dirhams, which led to a decrease in EBITDA by 7%.
In stable currencies, the retail business reported revenue growth of 8% and EBITDA increased by 5%. Retail sales through digital channels maintained their strong performance, recording a 13% increase in revenue to reach AED 1.2 billion in the first half of 2023.
During the same period, Majid Al Futtaim opened 5 new stores across the region, including two in Egypt for the Sobeco brand, which is based on a low-cost concept that combines the style of a traditional supermarket with wholesale stores. These efforts confirm that the company will continue to meet the growing demand from customers for digital and omnichannel experiences.
Leisure and entertainment
The company recorded an increase in revenues by 4% to reach 822 million dirhams, and an increase in profits before interest, taxes, depreciation and amortization, to reach 46 million dirhams. This is mainly due to the regularity of cinema screenings and the strength of the entertainment content.
The company’s entertainment business continues to expand its presence across the region. In June 2023, Snow Abu Dhabi, the first indoor snow park in the capital and the company’s fourth snow destination, was opened, confirming Majid Al Futtaim’s commitment to providing innovative experiences suitable for families and visitors from all over the region.
fashion
Majid Al Futtaim Fashion recorded revenues of 473 million dirhams, an increase of 31%, and profits before interest, tax, depreciation and amortization recorded a growth of 300% to reach 12 million dirhams.
Majid Al Futtaim Fashion “Lifestyle” opened 11 new stores in the first half of 2023, and introduced two new categories within its business portfolio, namely, luxury furniture and beauty. In January, the first luxury Italian furniture store, Poltrona Frau, opened in the region. And in May, the first Shiseido brand stores outside Asia were opened. These brands complement the existing ‘lifestyle’ portfolio of eight leading brands and two home-grown brands, providing additional opportunities to double the company’s year-on-year growth rates.
sustainability
The company continued to focus on achieving responsible growth rates in sustainability, including the phasing out of single-use plastic materials, supported by tax incentives provided by the UAE government, as Majid Al Futtaim recorded an 82% decrease in the consumption of this type of plastic materials and tools.
The company had successfully issued green sukuk worth $500 million in June this year, and the issuance proceeds will be directed to financing green projects eligible under the 2019 Green Finance Framework. This is the company’s fourth issuance in green capital markets, underlining its commitment to responsible finance. and its overall objectives in the field of environmental, social and institutional governance.
In June 2023, the Mall of the Emirates obtained the Platinum Category Leadership in Energy and Environmental Design (LEED) certification, becoming the largest mall in the world to receive this accreditation, and the company maintained a “low risk” rating in terms of environmental governance.
