By Staff writer
Marka operates over 53 outlets across its portfolio of hospitality, sports and fashion/beauty brands.
Dubai retail firm Marka has reported a Q3 loss of $3.2 million (AED11.8 million), a 15% improvement from the $4 million (AED14.7m) loss it reported last year.
Company also reported total revenue of AED 65.9 million ($17.9 million) in Q3 of 2016, a decrease of 15 percent compared to the same period in 2015.
In its statement, Marka said the results for Q3 reflect the company’s sale of a stake in Cheeky Monkeys Playland & Sweet Surprises during the quarter.
Despite failing to register a quarterly profit since it was floated two years ago, Khaled Almheiri vice-chairman and managing director of Marka, said the company remains positive, continuing to build “a portfolio of exciting and profitable hospitality, fashion/beauty and sports brands in order to deliver sustainable growth and long-term value for shareholders”.
The results, he said, were due to a slower summer period, but insisted the company’s operations remained “extremely resilient”.
“Despite the slowdown in the retail environment in general, in addition to the decline in the usual activity in this sector during the summer season, and specifically during the months of July, August and September, due mainly to the downturn in tourism as well as it being a time when most of our customers are on vacation, our food and beverage operations continue to be extremely resilient. Almheiri said.
He said the company had a busy quarter in Dubai, where it opened a new Reem Al Bawadi restaurant in Global Village and Harper’s Bazaar Café in City Walk 2. He said two new Cappucino outlets are due to be opened in Dubai’s new Outlet Village and City Walk 2 by December 2016, as well as a new dinh van store in Galleries Lafayette in Dubai.
“Our priority is on building the best retail operating company in the Middle East, and we are working towards this with plans to open a dinh van store and Morelli’s store in Mall of Qatar this year, while in January 2017 we have plans so far to open three new Reem Al Bawadi restaurants in the UAE, and a further Modell’s store in Al Ain,” he said.
Marka currently operates over 53 outlets across its portfolio of hospitality, sports and fashion/beauty brands.
The retail sector is under significant price/margin pressure and no amount of cost cutting will deliver the expected uptick in profitability.
A few key issues:-
- mall rents are too high
- product pricing off the charts
- decrease in tourists (ME, Russia, Europe)
- progressive penetration of online retailers whether here or in home countries
- significant downturn in job market & sentiment (people save rather than spend)
It's not just retail - almost every sector is hurting right now (airlines, hospitality, oil & gas, banking).
This may be the time where these sectors are forced to react and provide more value (better prices and/or service). Too many people have worked out that prices are cheaper in US, UK, Europe etc. and regularly buy there - shop & ship anyone?
I would also add the mentality of some owners/ceo's/managers are 'we will wait it out and everything will be fine'
instead of really looking for solutions.
@Victory Red, nope. I thought the same in 2009 and guess what, nothing changed. Same appalling level of customer service. Outside a few niches (upper tier hospitality and little else in my experience) companies pay only lip service to customer service.
About shop&ship or similar alternatives, yes the people i knew in Dubai used it for all expensive items. It is ridiculous that a watch would cost an additional 20% or more.
I think Khalid's comment will prove to be accurate. Ignoring the problem and waiting for an increase in oil prices to cover for the shortcomings.
Of course we will soon have the resident cheerleader claiming the usual nonsense.