Attendance was 81.14% and the meeting was inaugurated by Mr. Rashid Yaqoub Al Nafisi, chairman of Al Mazaya Holding Company, in the presence of Board Members, CEO Ibrahim Al Saqaabi, representatives from the Ministry of Trade and Industry, a representative from the auditing office, as well as executives from the company and a number of shareholders, investors, and media.
Al Nafisi opened the agenda of the meeting by reading the report of the Board for the financial year 2012, stressing that the 2012 was a year of setting the rules and establishing a new phase of achievements that the company is strongly anticipating in the coming years, after the transition from loss to profitability.
He stressed that Al Mazaya is deeply embedded in the local and Gulf real estate sector, in the media, on the ground, in the analysis of the market, and in various other reports across the broader economy.
He added that stability within the Gulf real estate market was not easy, especially since this medium has seen the highest levels of boom and bust over the year, so embarking on building the company internally and sustainably was an integral part of its long term establishment, not least the importance of projects already implemented, or in the process of implementation in the near future. Maintenance of the status quo in fact might need decisive action and careful decisions, and so it is considered that the internal building of the house, and ensuring everything is “in order”, is of the utmost importance. This is, he said, the company’s first permanent project upon which all other projects will be built.
Al Nafisi added that Al Mazaya Holding is pursuing a plan of action based on financial and administrative restructuring, and in doing so the company has also sought to untangle some of its investments and to exit from others, while completing others, paying a large portion of its obligations, and collecting arrears, to fulfill its obligations toward official authorities and investors, such as business avenue projects, the Villa project in Dubai, real estate portfolios such as “Dubai land portfolio”, the Lake Jumeira portfolio, the exit from Al Madar fund, and the acquisition of a stake in Oman Real Estate Development, all of which effected the positive outcomes at the conclusion of the last fiscal year.
In a quick review of the financial statements for the fiscal year, Al Nafisi said that the total assets of the company by the end of the year amounted to KD221.1m, compared with a total value of KD252.1m for the previous year 2011, while shareholders’ equity stood at KD83.3m in the year 2012 compared to a total value of KD81.6m in 2011.
THE financial year yielded total revenue of KD35.7m, compared to KD88.2m in 2011. This was accompanied by the decline in the volume of the amount owed to creditors by more than half, from KD36.3m to KD17.4m. With regard to the company’s profits, it made KD291,000 in net profit in the year 2012 compared to a loss of KD15.84m in the year 2011, which paved the way to the turning point from loss to profitability, due to the development of income-generating projects which raised the general operating profits of the company, including a 77% increase in rental revenue of KD2.8m for the year 2012, compared with KD1.6m the year before. The company’s total indebtedness to banks reached KD49.41m in the year 2012, compared to KD53.97m the previous year, which does not exceed 24.4% of the total assets of the company.
Al Nafisi noted that real estate is the engine of growth of civilization in the modern world. Real estate drives transportation, energy, construction, contracting, employment, engineering represented in engineering consultancy, banks and financial institutions, tourism, infrastructure and many other areas.
He assured the General Assembly that Al Mazaya Holding will continue through the year 2013 through its strong foundations which are based on internal and external pillars, especially the Board and the qualified executive management, and talented and experienced engineers, and technical, professional and engineering capabilities, and all the staff of the company, not to mention the vital role of the shareholders who gave the company strong support necessary for the company to be the most prominent and the most influential in the region: to achieve success after success.
Al Nafisi then went through the rest of the Assembly agenda for the year 2012, where the audience listened to and approved the Auditor’s Report and financial statements for the fiscal year. They also approved the recommendations of the Board not to distribute dividends for the financial year 2012.
The Assembly also approved the waiver of directors of their remunerations for the fiscal year, and authorized the Board to purchase or sell shares of the company, but not to exceed 10% of the number of shares in accordance with article 175 of the law 25, allowing the company to deal with the relevant parties.
The election of new Board of Directors
Al Mazaya Holding elected a new Board of Directors for the next three years. The members of the Board were discharged related to their legal actions for the financial year 2012, the Assembly appointed or re-appointed auditors of the company, and authorized the Board of Directors to determine their remuneration. After the ratification of the Agenda, Al Nafisi concluded the work of the Assembly and closed it upon the acceptance of the attendees.
For his part, the CEO of Al Mazaya Holding, Engineer Ibrahim Al Saqaabi, said that his vision in the development and growth of the company focuses on the ability of the company in engaging in numerous projects and in new markets in leveraging its launch from solid ground and a solid financial position.
He pointed out that the advancement of the company’s future requires putting the basic building blocks in place according to solid foundations, starting from developing the staff, and the renewal of the internal rules and regulations, which Al Mazaya is currently working on in accordance with the competent authorities. The company contracted with HAY International Group in order to study the administrative structure of the company and develop it in line with present and future human recourses, in addition to a study of the salary and incentive system and to lay the foundations such that the company operates in accordance with international standards and specifications.
In addition, Al Saqaabi said that Al Mazaya contracted with Protiviti to look at the current internal regulations and systems of the company in order to develop it in line with the next stage and future objectives of the company. The company has come a long way in this regard, and is expected to complete this step within the next few weeks.
Al Saqaabi introduced to the audience a presentation about the current status of the company, stressing that Al Mazaya has a solid financial balance sheet containing considerable real estate assets, and a strong base of shareholders, as well as assets worth KD221m, including real estate assets worth KD168m across four sectors inside and outside Kuwait, adding that the company’s total assets increased by 26% from 2004 to 2012, while operating income rose by 93% from the beginning of the work of the company until today.
Income Generating Projects Equivalent to KD65m
Al Saqaabi said that the first of these sectors are income-generating projects, which have successfully achieved high occupancy levels, such as the Glover medical project located inside Kuwait, with 100% occupancy, and the Al Mazaya tower project that services the office sector in the heart of Kuwait City, with 95% occupancy in one of its towers, and a 20% occupancy level in the other two. Al Mazaya has succeeded in attracting government agencies to rent in their towers alongside private sector companies.
Al Mazaya achieved an occupancy level of 100% in the Almeather towers located in Saudi Arabia, and occupancy level of 80% in the Sky Gardens tower in Dubai, and an occupancy level of 100% in the Indigo building in Dubai, alongside other projects that has been rented out in the past.
Real Estate Assets for the Purpose of Selling: value KD25.6m
The second of these sectors are the real estate assets for sale, represented in offices space in Business Avenue project in Dubai, and villas in the Dubai Land projects (currently under construction), and apartments in the Palm Island in Dubai.
A bank of distinct plots (under study for the purpose of sale or development) of value equal to KD20m
With regard to the third sector, Al Saqaabi described it as a bank of distinct plots, about which Al Mazaya is currently reviewing its visibility study in order to sell it or develop it with local or regional investors. These plots are distributed in Bahrain, Abu Dhabi, Lebanon, Oman, Sharjah and Dubai.
Real Estate Projects under Development worth KD57.2m
The fourth category is “projects under development and execution”, such as that which Al Mazaya owns for projects under construction in the emirate of Dubai, including the Alliwan project – 22 buildings for the middle class, currently underway, and expected to be delivered to the customers by the end of 2013.
He added that the balance sheet of the company has now become clean, after it had taken provisions and impairment losses exceeded KD137m in the past four years.
With regard to the future projects of the company, Al Saqaabi said that the company is currently working on a study with a view to investing in several real estate projects in Kuwait and outside, which will strengthen the economic cycle of the company and add to its real estate assets and operating revenue in the future.
Al Saqaabi concluded by saying that the real estate market is currently witnessing an acceptable revival which will lay the groundwork for real estate companies to invest in, especially those companies that have the experience and excellence in the real estate sector, like Al Mazaya which and can distance themselves from risk factors, adding that the current era is an era “of solidarity among investors and those who are interested in diversifying their investment basket and engaging in the largest number of projects,” noting that the main strength of Al Mazaya is the company’s track record of achievements in more than one market and more than one sector, alongside the support of the major owners and the experience of the executive management and employees, the confidence of the investors, contractors, and many other points that add to the balance of power in the company.
Monday, June 10- 2013 @ 15:03 UAE local time (GMT+4) Replication or redistribution in whole or in part is expressly prohibited without the prior written consent of Mediaquest FZ LLC.