Business | General
Kingdom's profit skids 83% on global turmoil
Losses from sale of Samba shares contribute to investment firm's drop in earnings.
- Reuters
- Published: 22:45 July 21, 2009
Riyadh: Kingdom Holding, the investment firm owned by Saudi Prince Al Waleed Bin Talal, on Tuesday posted an 82.8 per cent drop in second quarter net profit on the turmoil hitting global markets.
The firm had net profit of 92.1 million riyals in (Dh90.3 million) in the three months to June 30, down from 534.7 million riyals a year earlier, Kingdom Holding said in a statement posted on the Saudi bourse's website.
It attributed the drop to lower dividends from local and foreign stock market investments, a weaker operational performance of its hotel business and losses from the sale of shares in Saudi lender Samba Financial Group and food firm Savola.
Kingdom, which holds a stake in Citigroup, has cut to below the 5 per cent liable for public disclosure its stakes in Savola and Samba which stood last year at 10.1 and 5 per cent respectively. It did not say if it had any stock left in any of the two companies.
Kingdom made unspecified gains from the sale of a stake in a hotel in Geneva and land sales in the Saudi cities of Jeddah and Riyadh.
Operating profit was down 70.6 per cent at 195.7 million riyals in the quarter and based on previous earning statements its second-quarter earnings per share was 0.01 riyal versus 0.08 riyal a year earlier.
The firm noted that an external auditor expressed "reservations" about its stock investments categorised as available for sale, reiterating a statement made in April.
"The firm believes that the financial data and analyses concerning the assumptions and projections for the future price performance of these investments, which were compiled by international experts, were sufficient to assess the size of provisions that needed to be made," it said.
Earlier in July, the firm reported that the value of investments available for sale stood at 4.46 billion riyals by the end of June and that the unrealised losses stood at 17 billion riyals.
At the end of March, the value of Kingdom's investments available for sale stood at 3.73 billion riyals, down from 30.71 billion riyals a year earlier, according to audited statements.
More from Business General
More from Business
Business Editor's choice
-
UNB net profit rises 11% to Dh1.5b in 2011
Results are affirmation of prudent strategy pursued by group focused on targeted markets, key business segments
-
PTL Solar launches course in renewal energy
Programme will provide hands-on training to students
-
Nokia earnings hit by restructuring
Attributes €1.2b loss to one-time factors including closure of factory and asset revaluation
