The Saudi Real Estate Company recorded losses of 183 million riyals at the end of last year, compared to profits of 132 million riyals in the same period of 2017.

The company attributed this large decline in profits first to a decrease in overall profit by 11% due to a decrease in sales by 5% due to a decrease in the percentage of leased units, due to the impact on the public transportation project , And the increase in revenue costs by about 6%, the most important of which is the increase in consumption and operational employee benefits

As for the second reason, according to the company, the operating profit decreased by 73%, due to the increase in administrative and general expenses, as a result of the expansion of investment in subsidiaries, and the application of International Standard No. 9.

Of financial instruments, which led to the calculation and estimation of provisions for the decline of financial assets amounting to approximately 240 million riyals, which were charged to the income statement for the fiscal year 2018.

While the Saudi Real Estate Company stated that the increase in the burden of expenses, bank loans and hedging expenses by 133%, contributed to the increase in losses.

It is worth noting that the local real estate market in Saudi Arabia ended its activity during the first quarter of 2018, on an annual decline for the fifth consecutive year in the total value of its real estate deals by a rate of 30.8 Percent compared to the same quarter of 2017 (55.9 billion riyals), to settle at the end of the first quarter at less than the level of 38.7 billion riyals, which is the lowest first quarterly level for the market since 2010.

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