Dar Al Arkan's profits weaken in 2013
Weaker profits due to 'conservative' sales approach in stronger market
Saudi Arabia's biggest developer, Dar Al Arkan Real Estate (DAAR), has revealed that full-year net profits for 2013 dropped by 31% to $181.7m (SR681.5m).
The company said that the drop in profit was driven by lower property sales, as it said it was more conservative with its property offerings as a result of its strong cash position - it raised $750m through the sale of a sukuk last year, which also led to an increase in finance charges.
The company's chief financial officer, Mika Toivola, said: "DAAR continued to be conservative on property offering during 2013 to preserve value in an environment of escalating property prices.
"With 105% increase of leasing revenue compared with 2012, DAAR is on track to deliver its diversification strategy to diversify sources of revenue and income, reduce volatility, and improve profitability and earnings quality."
He added that it had finished the year with a strong balance sheet and liquidity that will allow it to meet debt maturiry dates as well as allow "strategic investments".