Majid Al Futtaim reports H1 net profit of Dhs1.6bn

Majid Al Futtaim reported a net profit of Dhs1.6bn for H1 2024, despite a challenging macroeconomic environment marked by regional geopolitical conflicts and foreign exchange devaluations.

The group’s assets grew by 2 per cent year-on-year.

Revenue declined by 6 per cent to 16.7 billion, while EBITDA fell by 2  per cent to Dhs2.1bn. However, at constant currency rates, the group’s revenue decreased by only 3 per cent, with EBITDA ( earnings before interest, taxes, depreciation and amortisation) and net profit posting a modest 1 per cent increase.

Ahmed Galal Ismail, CEO, Majid Al Futtaim – Holding, said: “Our first half-year results continue to underscore the strength of our diversified portfolio, protecting overall profitability despite the challenges within some of our current operating environments.

“Majid Al Futtaim Properties delivered a record performance, driven by the success of UAE-based shopping malls and strong consumer confidence in Majid Al Futtaim’s Tilal Al Ghaf and newly launched Ghaf Woods residential developments. Our lifestyle company continued to see positive demand across its portfolio, while the Entertainment company showed encouraging progress in its cinema admissions, reflecting the steady return of quality content.

“The ongoing transformation of our retail digital business has enabled solid progress in advancing our omnichannel aspirations. The appointment of new leadership in the second quarter will further strengthen retail’s performance through a turnaround plan focusing on market leadership through unrelenting customer-centricity.”

Majid Al Futtaim Group: Key H1 highlights

The group’s diversified portfolio, particularly its property and retail digital businesses, helped mitigate the impact of broader economic challenges.

The group’s property division saw a 9 per cent increase in revenue to Dhs3.7bn, with EBITDA rising by 11 per cent, driven by the success of UAE-based shopping malls and strong sales from its residential projects, including the newly launched Ghaf Woods in Dubai, which sold out its first phase within a week.

Read: ‘Ghaf Woods is more than just a new community,’ says Majid Al Futtaim Properties’ Ahmed El Shamy

Hotels reported an increase in revenue per available room (RevPAR) of 18per cent year-on-year mirroring Dubai’s increasing appeal as a tourism hub as the city welcomed over 9 million overnight visitors in the first half of 2024, while average occupancy was down by 2 per cent. In March, the group sold a number of non-core assets from its hospitality portfolio.

The retail segment experienced an 11 per cent decline in revenue to Dhs11.6bn, affected by weaker consumer sentiment and currency devaluation in key markets like Egypt and Kenya.

Nevertheless, the retail digital business delivered robust growth, with revenue up 16 per cent and EBITDA surging by 109 per cent year-on-year.

The group’s cinemas portfolio registered a 3 per cent year-on-year increase in admissions contributing towards a strong EBITDA growth of 103 per cent for the period.

The portfolio’s growth was further complemented by 3 new screens in Saudi Arabia during H1 2024, including the launch of the multiplex at Jeddah Park by VOX Cinemas.

Majid Al Futtaim maintained its strong credit profile, with Standard & Poor’s and Fitch Ratings affirming the Group’s BBB rating for the 12th consecutive year.

The group also preserved its low-risk ESG rating from Sustainalytics, reflecting its ongoing commitment to sustainability and responsible business practices.