Emaar The Economic City increased its losses by the end of 2019 to record 509 million riyals, compared to losses of 138 million riyals in 2018.
According to Arabia Net, the company explained in a statement that the reason for the high losses is due to the following factors:
- Increase in sales contracts adversely affected by the increase in financial expenses as a result of the increase in loan balances and the decrease in the capitalized value of borrowing costs due to the slow pace of development in line with the prevailing macroeconomic conditions.
- Other income decreased during the current year as a result of lower sales of investment properties.
- Launching some new operating assets in the hospitality and entertainment sectors to boost growth in King Abdullah Economic City, resulting in initial operating losses for these assets in the first period of operations.
- The group's share in the results of the investee company, the Ports Development Company (PDC), decreased mainly due to the loss resulting from the re-evaluation of the interest rate protection arrangements made by the company.
- Increase in the value of consumption and general and administrative expenses during the current year compared to the previous year.
Increase in provision losses over existing trade receivables.
