Majid Al Futtaim's 2019 revenues spike by 1% YoY to record $9.6bn

In 2019 the company pledged to phase out single-use plastic by 2025 and issued world's first benchmark corporate 'green' sukuk

My City Centre Masdar is the company’s first shopping mall in Abu Dhabi.
My City Centre Masdar is the company’s first shopping mall in Abu Dhabi.

UAE-headquartered business conglomerate Majid Al Futtaim has recorded $9.6nb (AED35.2bn) in revenues in 2019, which grew by 1% year-on-year compared to the previous year.

In 2019, the group also posted strong operational performance that was driven by its diversification initiatives as well as its focus on cost efficiencies and scale. This, according to the company, resulted in a 1% increase in earnings before interest, taxes, depreciation, and amortisation (EBITDA) to $1.3bn (AED4.6bn). Meanwhile, the company’s total assets reached $17.2bn (AED63bn) in the same period.

Majid Al Futtaim expanded its footprint in 2019 with the opening of Carrefour’s first store in Uganda, the addition of three new shopping malls, and the expansion of VOX Cinemas in Saudi Arabia — which ended its 35-year ban on cinemas in 2018 — with the addition of 78 new screens. 

Speaking on the 2019 financial results, chief executive officer of Majid Al Futtaim Holding, Alain Bejjani, said: “Majid Al Futtaim’s financial performance is driven by a sustainable business model that continues to deliver growth for the company.”

“In line with our core values and responsibility towards the environment, sustainability remains a top priority for Majid Al Futtaim. Securing a low risk ESG rating, issuing the world’s first benchmark corporate Green Sukuk, and committing to phase out single use plastic from our operations were milestone moments in our sustainability journey.”

In November 2019, the company pledged to phase out single-use plastic by 2025. The company listed a 10-year benchmark corporate 'green' sukuk worth $600m (AED2.2bn) on Nasdaq Dubai, making it the world’s first financial instrument of its kind to focus on sustainability-focused investments.

In 2019, Majid Al Futtaim – Properties’ EBITDA remained stagnant at $816.7m (AED3bn) compared to 2018 figures. Meanwhile revenue decreased by 1% to $1.3bn (AED4.6bn), which mainly due to the impact of challenging market conditions on revenue per available room (RevPAR) in the hotels business, despite outperforming the market in Dubai and a 3% increase in room occupancy across the Majid Al Futtaim portfolio.

The company added three shopping malls including the opening of City Centre Sohar in Oman and City Centre Almaza in Egypt, as well as its first mall in Abu Dhabi, My City Centre Masdar.

The company’s retail business recorded 1% growth in revenue to reach $7.7bn (AED28.1bn) in 2019, despite a reduction in discretionary spend and basket size due to weaker consumer sentiment. EBITDA increased by 2% to $381.1m (AED1.4bn).

2019 also witnessed the opening of 12 hypermarkets and 30 supermarkets under the Carrefour brand. Additionally, the company now has 300 Carrefour stores under the brand, with the first having opened in Uganda.

Revenues at Majid Al Futtaim – Ventures reached $762.3m (AED2.8bn) in 2019, with an increase of 17%. Meanwhile, EBITDA spiked by 30% to $113.3m (AED416m) that was driven by growth across Saudi Arabia, Kuwait, and Egypt.

The total number of screens under the VOX Cinemas-brand increased to 499 across the region. In Saudi Arabia, VOX Cinemas opened 78 new screens bringing the total number of screens opened in the kingdom to 82.

VOX Cinemas will continue to expand its presence in Saudi Arabia and plans to open 600 screens in the country by 2023.

As part of its expansion plans, Majid Al Futtaim plans to increase its shopping malls to 28 in 2020 with the opening of two new malls in Sharjah including City Centre Al Zahia, which will be the largest mall in the Northern Emirates, and Matajer Al Musalla which opened in Q1 2020.

In 2020, the company plans to open 87 new screens, with a focus on new cities in the kingdom, including Tabouk, Hail, and Jubail and adding new screens in Riyadh, Jeddah, and Dammam.

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