United Real Estate Company announces its Financial Results for the Year Ended 2020

Mar 29 , 2021

United Real Estate Company K.S.C.P (URC), a leading real estate developer in Kuwait and the MENA region, announced its financial results for the year ended 31 December 2020.

The Company reported a net loss of KD 15.9 million in 2020 compared to net losses of KD 7.2 million in 2019. URC recorded an operating loss of KD 2.9 million in 2020 compared to an operating profit of KD 8.8 million in 2019.

Operating profits in the first half of 2021 were KD 6.45 million compared to KD 1.65 million reported in the first half of 2020. Operating profits in the second quarter of 2021 were KD 3.17 million compared to an operating loss for the same period of 2020 at KD 3.40 million.

The restrictions imposed by the government due to the COVID-19 pandemic had a negative impact on the economy which reflected on URC’s revenues and profitability during the year, impacting most of its business segments, with retail malls and hospitality sectors being the most affected.

URC’s total assets declined by 2.4% to reach KD 608 million at the end of 2020 compared to KD 623 million at the end of 2019.

Commenting on the results, URC Vice-Chairman & Group Chief Executive Officer Mr. Mazen Issam Hawwa said, “The COVID-19 pandemic created significant challenges on all fronts. URC and its people mitigated the losses by the proactive measures taken by the Company. These measures focused on customer concerns, retention, and sustainability of business to ensure prompt recovery after easing restrictions. Efforts also included cost-saving initiatives and restructuring the Company’s debts, which resulted in lower financing costs and improved liquidity levels.”

Mr. Hawwa added, “Despite the economic slowdown caused by the COVID-19 pandemic, the Company maintained occupancy levels in its retail malls at stable levels. The hospitality sector witnessed partial recovery due to the increased demand of local tourism and we are confident that the performance of our hotels will further improve with the acceleration of the vaccine rollout and lifting travel restrictions.”

URC continues to progress with its development activities, namely Hessah Towers, Byout Hessah, and the Commercial component, in Hessah AlMubarak District. Hessah Towers construction maintained timely progress with sales reaching 50% of its total units. URC recently witness the project launch of both Byout Hessah, and soon the Commercial District. During 2020, URC also achieved the successful sale of several residential units at Raouche View 1090 in Lebanon utilizing its proceeds for full repayment of its high-interest loan.

Mr. Hawwa concluded, “With this performance, the Company focuses on remaining resilient while mitigating arising challenges to ensure its business growth and sustainability, in line with its strategy-focused mission to be a leading developer and investor in the real estate landscape.”