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Dar Al Arkan profit nearly doubles as lease revenue rises

An artist's impression of Dar Al Arkan's Aida, a mixed-use project, overlooking Muscat, Oman Dar Al Arkan
An artist's impression of Dar Al Arkan's Aida, a mixed-use project, overlooking Muscat, Oman
  • Overall revenue drops 3.6%
  • Operating expenses fall
  • Lease revenue climbs

Profits almost doubled for the third quarter at Saudi Arabia’s largest developer, Dar Al Arkan, driven by a fall in operating expenses and an increase in lease revenue.

For the quarter ended September 30 2023, profits rose 91.27 percent to SAR151.91 million ($40.49 million), from SAR79.42 million a year earlier, the company said in a filing to the Saudi stock exchange.

However, revenue was down 3.6 percent year-on-year to SAR715.7 million.

The developer’s net profit rose nearly six percent year on year to SAR416.01 million in the first nine months of 2023, as a result of a decrease in operating expenses, an increase in lease revenue and a higher profit share from associates. 

The increase in finance costs was partially offset by the higher non-operating income from the Murabaha deposit.

Murabaha is an Islamic financing structure in which the seller and buyer agree to the cost and mark-up of an asset.

Revenue fell 24.13 percent to SAR2.31 billion during the nine-month period, from SAR3.04 billion a year earlier.

Shareholders’ equity, after minority interests, stood at SAR20.10 billion as of September 30, 2023, against SAR19.55 billion in the same period last year. 

In July, the developer closed its ninth tranche of the US dollar-denominated sukuk, worth SAR2.25 billion.

Dar Al Arkan, the kingdom’s largest developer by market value, has more than $8 billion in assets. Its independent subsidiary Dar Global completed a $600 million listing on the London Stock Exchange in February. 

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