The CEO of Al-Hayat International Real Estate Company, Hisham Al-Obaid, confirmed that the company successfully managed to be free of debts this year, and that it is continuing to search for opportunities that are aligned with its prudent investment and financial policies. Revenues exceeded expenses by 22%, mainly due to their lower level in 2020, as the Company has taken unprecedented steps to cut costs to mitigate months-long shutdowns and navigate the negative impacts of the pandemic, and government support for Kuwaiti salaries.
This statement was given during the Company’s Annual General Meeting (AGM) for the financial year ended 31 December 2021. The AGM also passed a resolution to distribute 3.5% cash dividends for an aggregate amount of KWD 350,000, for the second half of the financial year ended 31 December 2021 to shareholders registered in the company’s books as of the record date.
The company achieved sound results for the financial year ended 31 December 2021, with net shareholders’ equity reaching KWD 13,298,157 (book value of approximately 133 fils) compared to KWD 13,272.204 (book value approximately 133 fils) in 2020. Total assets stood at KWD 14,185,460 compared to KWD 14,091,195 in 2020, whereas net profits amounted to KWD 777,832 compared to net profits of KWD 553.787 in 2020. Total liabilities amounted to KWD 887,303 to KWD 818,991 in 2020, which amounts to about 6% of the company's total assets.
The AGM also approved the payment of 2.5% interim cash dividend distributed on 1 September, amounting to KWD 250,000, based on the prior authorization of the Board of Directors at the AGM held on the 10th of this month. The resolution to pre-authorize the Board of Directors to distribute semi-annual interim dividends to shareholders for the financial year 2022 (based on the approval received during the EGM held on 30 November 30, 2020, was also approved. Additionally, the AGM also approved the Board of Directors’ recommendation to pay renumerations bonus to board members the financial year ended 31 December 2021 in the amount of KWD 17,500, as well as all other items listed on the agenda. Moreover, 10% or KWD 81,037 was deducted towards the statuary reserve for the financial year ended 31 December 2021, and it was approved not to make any deductions towards the voluntary reserve for the financial year ended 31 December 2021.
“2021 ended with a favourable outcome and we had numerous achievements, as we managed to overcome the obstacles imposed by the pandemic and got over weak revenues due to the COVID-19 related restrictions in 2020. The net performance of Al-Hayat Shopping Centre jumped by 29%, with a great demand for rental spaces and an occupancy rate exceeding 99%, thanks to its vital location as it is surrounded by main streets, and the recovery of the Shuwaikh Industrial Area in general”. Al-Obaid added.
Commenting on the real estate situation, Al-Obaid said that it is currently on the cusp of a difficult stage in light of higher interest rates, and the ongoing trend seems to favour further interest rate hikes. Following the Central Bank of Kuwait’s move to raise its interest rates, I think it will not be less than 1%, which we haven’t witnessed for a long period of time. This will add further pressures on real estate prices, which seems to be a global trend. The central bank will have to follow the US Federal Reserve in raising interest rates, and therefore I expect the interest rate to rise to 1% over the next couple of months. This will undoubtedly affect real estate price, and bank financing will cost more.” Al-Obaid concluded.