Riyadh - Mubasher: Abdul Mohsen Al Hokair Group for Tourism and Development Co. on Monday reported a sharp drop in profits for the third quarter and first nine months of 2017.
The company suffered a decline in net income by 83.87% year-on-year to SAR 9 million ($2.4 million) in Q3-17 from SAR 55.8 million ($14.88 million), according to a statement to the Saudi Stock Exchange (Tadawul).
Quarter-on-quarter, Al Hokair Group’s profits fell 39.19% from SAR 14.8 million.
The setback in earnings came as result of the weaker demand on the company’s hotel and hospitality sector due to lower government spending and fewer private-sector conferences and events, Al Hokair revealed.
Increased market competition further impacted the company’s average daily room revenue, the statement showed, noting that a decrease in other earning sources such as the profit share from sister companies also contributed to the profit decline.
The seasonality of Al Hokair’s entertainment division was a reason behind the profit drop, as both Eid Al-Fitr and Eid Al-Adha coincided with Q3-16 while this year of 2017 only Eid Al-Adha took place in the third quarter, the company added.
Meanwhile, net income for the first three quarters ended September 2017 was SAR 31.8 million down from SAR 121.5 million for the same period of 2016, registering 73.83% decline.
Abdul Mohsen Al Hokair Group previously reported a decline in net income by 10.3% to SAR 14.8 million in Q3-17 from SAR 16.5 million in the year-ago period.
Abdul Mohsen Al Hokair’s stock ended Monday down 1.85% to SAR 28.09 per share.
