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Alandalus Property, a pioneering real estate company involved in the investment, development and operation of income-generating properties across Saudi Arabia, has registered a 35 per cent growth in its net profit for FY 2019 which surged to SR64.8 million ($17.2 million) from SR48 million ($12.7 million) in 2018.

Announcing its financial results for the full year ending December 31, 2019, Alandalus said this sudden rise was mainly due to higher gross profit and a jump in the share of income from associates.

The sharp fall in impairment losses of investment in associate and a lower Zakat provision for 2019 also supported the growth in net profit.

Alandalus Property’s retail segment continued to benefit from high footfall and occupancy rates, with its unique retail destinations welcoming over 30 million visitors during FY 2019, said the statement from the Saudi-based group.

The company’s regional malls portfolio too enjoyed significant demand from the retail community, recording an average occupancy of 98%, it stated.

Leveraging the acquisition of Salama Tower, Alandalus Property expanded its offices segment, generating revenues exceeding SR10 million for the year, it added.

On the solid results, CEO Hathal Al Utaibi said: 'Alandalus Property faced a pivotal year in 2019. Our strategy of positioning the company towards growth while diversifying the portfolio to better manage risk has allowed us to maintain steady, healthy returns.'

'Over the past year, we made the decision to diversify further through the addition of our offices business segment by launching Salama Tower in Jeddah. We also deepened our commitment to expanding our retail business with the introduction of Al Marwa Centre and the ongoing development of Al Jawhara Mall,' noted Al Utaibi.

'Our first investment in the healthcare sector - through a joint venture with the Dr Sulaiman Al Habib Medical Group - is showing progress and will play a key role in supporting our growth for years to come,' he stated.

'Our efforts in 2020 and beyond will continue to focus on reimagining the retail experience in Saudi Arabia. This will be supported by the opening of the cinema complex at Alandalus Mall and further upgrades to the F&B and entertainment spaces at our super regional malls,' he added.

The Saudi real estate group said its revenue for FY 2019 increased by 6.91% to SR176 million from SR164.7 million the previous year, thanks to the grwoth company’s retail and office segments.

In 2019, the company expanded its office leasing and retail businesses with the acquisition of Salama Tower and the inauguration of Al Marwa Centre. This helped offset the challenging environment faced by the Company’s hospitality segment, it added.

Alandalus Property’s gross profit grew by 9.3% to SR102.4 million from SR93.7 million in FY 2018, led by the uptick in revenue from the retail and office segments.

Its operating profit too increased by 12.6% to hit SR104.2 million, compared to SR92.6 million in FY 2018, led by a higher share of income from associates, and increase in other revenues, it added.

Chief Financial Officer Fawaz bin Huwail said: 'Alandalus Property’s latest financial results reassert the company’s ability to deliver resilient returns despite sector-specific challenges and the impact of IFRS16 (leases).'

'The unique enhancements we have introduced to our retail destinations continue to give us an important edge in the Saudi retail market, as evidenced by the 7% increase in revenues for the segment,' remarked Bin Huwail.

'Despite witnessing a sizeable drop in revenues compared to 2018, our hospitality portfolio continues to perform in-line with our expectations and the headwinds facing the wider industry. Looking ahead, we will continue to optimize costs throughout the business and step-up growth and diversification efforts to ensure we continue to benefit from a well-rounded revenue mix,' he added.