The publicly listed Al Akaria Saudi Real Estate Company (SRECO) has announced plans to double its share capital by issuing one bonus share for every share.
The planned move is based on the recommendation of SRECO’s board of directors, and will raise the company’s share capital from $320m (SAR1.2bn) to $640m (SAR2.4bn).
SRECO’s number of outstanding shares will grow from 120 million to 240 million, the company said in a statement, adding that the increased share capital is a reflection of its aim to match its capital with its current assets.
The company also released details of its Q1 2018 financial results, reporting that it netted $11.9m (SAR44.6m) of profit during the period, 11.5% higher than its net profit in Q1 2017.
In 2017, the company’s net profit reached $35.2m (SAR132m), 80% higher than the previous year’s.
The company attributed the growth to 80.9% reduction in financing costs, 20.2% increase in profits from its joint ventures and subsidiaries, 16.7% increase in short-term Murabaha income, and continuing growth in revenue by 2.2%.
The Saudi joint stock company, which counts Saudi Arabia’s Public Investment Fund (65%) and the Public Pension Agency (5%) as majority shareholders, said that it is preparing to launch “ambitious” expansions plans aimed at delivering “a new genre” of mixed-use developments in the kingdom.
SRECO chief executive officer, Abdullah bin Ibrahim Saad Al Ayadhi, commented: “We are pleased to have delivered another strong set of results in 2017, with our proactive approach to asset management across the portfolio making a significant contribution to this success.
“Our company is underpinned by a strong leadership, clear vision and, importantly, robust financial stability, which provide necessary foundations from which to build a new era of sustainable urban communities.
“We are excited to soon be embarking on a new chapter in the company’s history, which – aligned to Vision 2030 – provides an […] opportunity to elevate our track record of delivering […] community-centric real estate developments to a new level,” he added.
The company’s active projects include Al Dhahia, a 430,757m2semi-gated residential and commercial complex that consists of residential units, commercial space, and retail and leisure amenities.
SRECO’s Al Narjes Compound, meanwhile, is a 25,570m2gated community in Riyadh that comprises 162 furnished residential units, 31 townhouses, and 131 apartments.
The real estate company is also implementing an extension to Phases 1 and 2 of its Masaken Al Akaria project in the Diplomatic District of Riyadh, which includes 21 three-storey residential buildings that occupy a total area of 14,876m2.
In 2017, SRECO implemented a new business framework for its financial and administrative processes and embarked upon a digitisation program to automate its administrative and financial business processes.