Kingdom Holding Company (KHC), a conglomerate owned by Saudi Prince Alwaleed bin Talal and the largest in Saudi Arabia, has posted a 82.8 per cent drop in net profit for the second quarter compared to the same period last year as income from its global investment portfolio affected performance. In a statement, the firm said it had a net profit of 92.1 million riyals (US$24.6 million) in the second quarter, down from 534.7 million riyals last year, but an increase of 83.4 per cent when compared to the results for the first quarter of this year.
Consolidated net income for the first six months of 2009 fell 83 per cent to 142.2 million riyals from 838.5 million riyals in the same period last year. The losses were due a drop in dividend payments from the company's local and international investments and lower operating profits from the hotels it owns and manages. The company also recorded losses from the sale of stakes in Samba Financial Group and Savola Group, two listed firms in Saudi.
"Kingdom Holding Company returns to profitability through its sound strategic plan," HRH Prince Alwaleed said in the statement. "I feel confident that KHC's financial results will continue to grow during the remainder of this year. KHC has in place a very well defined vision and its executive team is fully committed to achieving the company's financial results and objectives." The statement added that KHC is still going ahead with its huge real estate Jeddah and Riyadh projects as planned.
Meanwhile, Emaar Economic City (EEC), the Saudi Arabian subsidiary of Dubai developer Emaar Properties, posted a second-quarter net loss of 113.1 million riyals from 40.4 million riyals a year earlier. EEC's second-quarter revenue stood at 18.8 million riyal. The company is developing the King Abdullah Economic City (KAEC) project on Saudi Arabia's Red Sea Coast. "These losses were the result of a normal increase in operating costs in the absence of operating profit, since the King Abdullah Economic City is still under construction," the company said in a statement to the Saudi bourse.
Emaar Properties said in June that it was finalising negotiations with KHC for the contract to manage the development of Kingdom City, a 100 billion riyal development planned by KHC in Jeddah. The development will included the 1km-high Kingdom Tower. * with agencies agiuffrida@thenational.ae
