Al Akaria’s Q2 2019 earnings came higher than analysts’ expectations, NCB Capital said in a research note.
“We believe the deviation is mainly due to lower than expected opex and higher than expected other income. Other income stood at SAR 14.2 million in Q2 vs our estimates of other expenses of SAR 1.3 million,” NCB Capital said.
The firm has placed Al Akaria share “under review” given the substantial changes in the strategy and structure of the company.
“We believe the decline in the rental income of the office segment would impact the company going forward,” it noted.
However, the company’s mass expansion in the hospitality and residential segments are expected to improve the long-term outlook.
“As a result of the company’s mega projects we believe dividends may be at risk going forward,” it added.
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