Dubai-based retail giant Majid Al Futtaim (MAF) has reported largely flat results for the first half of 2019, with a 1 percent increase in revenue leading to a similar increase in earnings for the six-month period.
During what was described by the shopping mall, communities, retail and leisure provider as “challenging market conditions and more cost-conscious consumer behaviour across the region”, half yearly revenue stood at $4.8bn (AED17.9bn) and earnings (EBITDA) at $571m (AED2.1bn).
Alain Bejjani, chief executive officer, MAF – Holding, attributed the resilient performance to innovation in targeting customers.
He said: “The strength and durability of our business has been a key factor in our financial performance for the first half of 2019, demonstrating the importance of geographic and business model diversification.
“Our focus on delivering a unique and innovative customer experience has enabled us to extend our customer base, while we have successfully optimised costs and created greater operating efficiencies.”
MAF – Properties registered a 3 percent decline in revenue in the first six months of the year to $572 million (AED2.1bn). The company’s shopping malls welcomed more than 100 million visitors in the first half of the year, with the total occupancy at 93 percent.
While the hotels operation reported an increase of 2 percent in their average occupancy rate, growing to 78 percent, “although a decline in revenue per available room (RevPAR) was reported in line with wider market trends”.
Despite a reduction in discretionary spend and basket size, MAF – Retail recorded flat revenue growth, standing at $3.9bn (AED14.6bn) in the first six months of the year. While revenue was driven by new store openings in Egypt, in particular, earnings decreased by 1 percent to $164m (AED603m) compared to the same period in 2018.
The Carrefour brand continues to cement its position as the largest grocery retailer in the region, with the opening of seven hypermarkets and 12 supermarkets.
MAF – Ventures, witnessed a 16 percent increase in both revenue and earnings in the first six months of the year, with revenue standing at $354m (AED1.3bn) and earnings at $37m (AED137m).
VOX Cinemas strengthened its market share in Saudi Arabia, driving forward its pioneering expansion in the kingdom with the launch of 49 new screens. Of the 600 screens committed to KSA by 2023, MAF has already opened 53. In total, VOX Cinemas opened 65 new screens across the region during the first half of the year.
In terms of the outlook for the rest of the year, MAF outlined plans to open more properties, City Centre Almaza is set to open in East Cairo, while its first Carrefour store will open in Uganda in the second half of the year as well as 12 new stores in Egypt.
The company will also launch a lifestyle rewards programme, giving customers the chance to earn and spend points across the company’s portfolio.
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