Jabal Omar’s 2018 financials represent a big profit jump for the firm: CEO

Saudi developer Jabal Omar Development Company reported strong profit in 2018, representing a big turnaround for the company, its CEO Yasser Al-Sharif told Al Arabiya in an interview.

“Selling residential unit is the core business of Jabal Omar’s operational model and strategy, in addition to improving revenues from hotels and shopping malls,” Al-Sharif said.

“We will focus on delivering hotel and residential units, and we’ll announce opening new hotels soon,” he further added.

Meanwhile, he attributed the increase in other revenue to the firm’s investments in Alinma Fund.

According to Al-Sharif, Jabal Omar turned to profit in 2018 compared to 2017 due to the following factors:

- A revenue increase by 245 percent year-on-year (YoY) due to SAR 1.2 billion worth of residential unit sales (versus none a year earlier), and a 28 percent YoY and a 60 percent YoY increase in revenue from hotels and shopping malls, respectively.

- A decrease in the cost of revenue to 59 percent from 98 percent a year earlier on higher profit margins driven by residential unit sales, including off-plan sales which started Dec. 2018.

- Operating costs dropped by 108 percent YoY due to a SAR 243 million increase in other revenue, and lower rate of operating expenses to revenue (13 percent YoY versus 37 percent in 2017).

According to data compiled by Argaam, Jabal Omar reported a net profit after zakat and tax of SAR 193.78 million for fiscal year 2018, versus net losses of SAR 600.96 million in year-earlier period.