Majid Al Futtaim posted record first-half earnings before interest, tax, depreciation and amortisation of AED2.5 billion, up 11% year on year, as property development, shopping malls, cinemas and digital businesses lifted profitability despite subdued consumer conditions in parts of its retail operations.Net operating profit after tax increased 25% to AED1.8 billion for the six months to June, while group revenue rose 1% to AED17.5 billion, the Dubai-based company said in results released on Wednesday.
The stronger rise in earnings than revenue reflected a larger contribution from higher-margin activities across the privately held group's diversified portfolio. Majid Al Futtaim said the operating environment became more challenging during the second quarter amid regional tensions, but its mix of property, retail, entertainment, lifestyle and digital businesses helped sustain growth.
Development was the strongest-performing major division, with revenue rising 38% from a year earlier. The group said its development pipeline now exceeds AED100 billion, while AED2.8 billion of construction contracts were awarded during the first half.
That pipeline includes an AED62 billion agreement with Dubai South for a 22-million-square-foot mixed-use community, as well as a partnership with Midar for a mixed-use project in Cairo. Construction also progressed at Ghaf Woods and on the redevelopment of Mall of the Emirates.
Asset Management, which includes malls and hotels, recorded 4% growth in net revenue to AED2.3 billion. Shopping mall revenue rose 12%, supported by leasing activity and tenant performance, helping offset softer hotel demand during the second quarter.
Retail remained the principal weak spot. Revenue fell 6% year on year, mainly because of non-food categories and weaker consumer conditions, particularly in the UAE, alongside changes being implemented under the division's transformation programme.
Markets outside the Gulf Cooperation Council provided some counterweight, with retail revenue there increasing 4%, supported by stronger performance in Egypt and Kenya. Digital retail revenue rose 11% to AED1.8 billion, while Precision Media revenue jumped 89% to AED75 million.
Cinema revenue increased 3% during the period, supporting the entertainment division. Lifestyle revenue rose 5%, with digital sales up 9%. The group opened five lifestyle stores and secured seven further openings, expanding a portfolio that includes international brands operated across its regional platform.
Majid Al Futtaim's balance sheet remained sizeable, with total assets of about AED73 billion at the end of June, 4% higher than a year earlier. Net borrowings stood at AED13.2 billion. The company said cash and available committed credit lines covered more than two and a half years of net financing needs.
Chief executive Ahmed Galal Ismail said profitability had been supported by several growth engines across the group's 14 markets and by disciplined execution. The company serves more than 600 million customers annually across its businesses.
Its SHARE loyalty programme reached about 14 million members after expanding into Saudi Arabia. More than 190,000 customers were transacting through the programme each day, while more than 140,000 SHARE credit cards had been issued.
Customer satisfaction indicators also improved. The group's Net Promoter Score rose four points to 58.3, while digital revenue increased across entertainment, retail and lifestyle operations.
Majid Al Futtaim said it would continue allocating capital selectively to property and digital capabilities, including data and artificial intelligence, financial technology, e-commerce and Precision Media.
The company also expanded its sustainability certifications during the half, securing recognised standards across 23 wholly owned shopping malls. Eighteen achieved LEED Platinum status, four received LEED Gold certification and one held an Estidama Three Pearls rating.
Chairman Fadel Abdulbaqi Al Ali said the performance reflected disciplined stewardship, prudent capital allocation and continued investment in customer experience and partnerships. Ismail said the group would keep connecting its businesses more closely while investing in destinations, platforms and technologies intended to create additional growth opportunities.
The group said more than 70 brands were supported through Ma'an, its programme for home-grown businesses, while employment and entrepreneurship initiatives continued across its markets. Emiratis in professional roles increased 14% year on year, alongside the launch of an Emirati Youth Council and Youth Majlis.
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