Kuwait’s URC posts net loss of $30m in 2018 despite revenue surge
Listed developer attributes decline in operating profits to reduced values of its properties in Kuwait and the UAE
Kuwait bourse-listed United Real Estate Company (URC) has revealed that its 2018 operating revenues grew to $338.6m (KWD103m), 18.4% higher than corresponding 2017 figures of $286m (KWD87m).
However, the developer recorded a net loss of $29.6m (KWD9m) in 2018, a significant decline compared to 2017 net profits of $7.2m (KWD2.2m).
Operating profits at URC stood at $29.6m (KWD9m) in 2018, a 57% decline from 2017's $69m (KWD21m).
URC's decline in profits was attributed to several factors, including declining properties value in Kuwait and other countries such as the UAE; and a surge in annual amortisation of build–operate–transfer (BOT) investments due to the near-end of these investments.
Acting chief executive officer of URC, Ahmad Kasem, said that the company's revenues from its contracting and services businesses increased by 19% during the year, with profits from these sectors surging by 73%.
According to Kasem, the company is planning to diversify its income streams through its contracting and services businesses.
In December 2018, URC began construction on Phase 1 of two-building Hessa Towers project, which is expected to complete in 2022. With a total built-up area of 6.3ha, each tower comprises 40 floors with apartments ranging from duplexes- and- townhouses.