Properties porfolio drives Majid Al Futtaim profit as it eyes African expansion

Majid Al Futtaim (Maf) posted a 6 per cent increase in earnings last year as the Dubai-based conglomerate continued to invest in Dubai and boosted its interests in Oman and Egypt, it said yesterday.

Earnings before interest, tax, depreciation and amortisation (Ebitda) rose to Dh3.8 billion last year from Dh3.6bn in 2014, Maf said. Revenue grew 8 per cent to Dh27.3bn last year from Dh25bn a year earlier.

The conglomerate said last year it planned to double in size within five years as it boosts investments across the Arabian Gulf and Egypt.

“Majid Al Futtaim’s 2015 financial performance has demonstrated the strength and resilience of our business against a backdrop of a regional economic slowdown,” said chief executive Alain Bejjani.

Ebitda of its properties’ portfolio was the largest contributor to earnings, rising 9 per cent to Dh2.6bn last year. Its retail business recorded 2 per cent growth in Ebitda to Dh1.2bn as the company entered new markets and opened Carrefour supermarkets.

The conglomerate, which operates Mall of the Emirates, plans to expand further in Africa, with a focus on eastern and southern nations. Maf, which has exclusive rights to the Carrefour supermarket franchise in 38 markets across the Middle East, Africa and Central Asia, plans to establish its first outlet in sub-Saharan Africa in Kenya this year.

“With several large-scale developments currently in the pipeline in Saudi Arabia, Egypt, and Africa, we are well positioned to fully leverage the significant growth potential of the Middle East and North East Africa region,” said Mr Bejjani.

Maf is bullish about Egypt, having announced last year its plan to increase investment in the North African country to 22.5bn Egyptian pounds (Dh10.29bn) from 18bn pounds.

As for its borrowings, the con­glomerate said it has cash and available committed lines that will cover its net financing needs for the next two to three years.

The group last year issued a US$500 million Islamic bond, or sukuk, to extend the maturity of its debt to five years.

“In line with our conservative approach, we continue to stay committed to proactively managing our future financing plans, and opportunistically op­ti­mising our debt portfolio depending on market conditions and always within the capacity of our credit rating,” said Jürgen Schulte-Laggenbeck, the Maf chief financial officer.

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