Union Coop says net profits to rise by more than 18% compared to previous five-year plan
Dubai-based retail giant Union Coop is forecasting AED2.73 billion ($770 million) net profit over the next five years.
The retailer has revealed the figure in its five-year growth plan for 2018-2022, saying it represents an increase of AED430 million, or 18.7 percent compared to the previous five-year plan.
Union Coop recently released its five-year growth plan which also projected its revenue of AED 5.69billion for the year 2022 and total revenue for the five years estimated AED20.6 billion.
“The profits projected in the five-year plan demonstrates the aptness of our approach and affirms the principle of transparency adopted in presenting the financial statements,” said Majid Hamad Rahmah Al Shamsi, chairman of Union Coop.
He said the growth will be achieved despite a set of challenges facing the retail sector.
“Like every other entity in the retail sector, Union Coop also deals with certain set of challenges... many banks have reduced their facilities and complicated the process of obtaining them, which has had a significant impact on the growth of the suppliers and affected their performance and strength negatively in the market.”
He added: “The delay in issuing the updated Consumer Cooperative law is also one of the significant challenges that hamper the expansion of consumer cooperatives. The new law, which will be much more flexible in nature will definitely help consumer cooperatives in growing and expanding better.”
Union Coop previously announced plans to nearly triple its portfolio to 6.26 million sq ft by 2022 as it predicts an 84 percent jump in revenue.
Union Coop’s total retail area will grow by 264 percent from its current 2.36 million sq ft while revenue is estimated to rise to AED5.69 billion.
The company's investment in assets is also expected to nearly double to 3.92 billion by 2022.
Union Coop, which began its journey with Satwa branch, now has 15 branches and two malls, and 16 future projects in the five-year forecast.