Alhokair Group’s profitability, cash flow improving: CEO

Fahad Al Obailan, CEO of Abdulmohsen Alhokair Group for Tourism and Development (Alhokair Group)

Abdulmohsen Alhokair Group for Tourism and Development has undertaken numerous initiatives aimed at recovering from losses and turning gradually to profitability, CEO Fahad Al Obailan told Argaam in an interview.
 

These initiatives helped the company align with market changes. There were several initiatives aimed at developing the business model, adding new operations such as catering and food services, conduct internal restructuring to enhance operational efficiency, and exiting several loss-making projects and branches (such as the cinema project, several hotels, and entertainment parks). Alhokair Group aimed to recover from losses and gradually turn profitable.

He explained that the management made effort to reduce accumulated losses, which amounted to SAR 103.8 million, representing 32.96% of the company’s capital. The losses decreased compared to their levels in early 2024. Alhokair Group endeavors are currently underway to further cut losses.
 

Commenting on the auditor’s notes, Al Obailan said that the company has seen an improvement in performance in terms of profitability and cash flows. The auditor applies standards when making observations that align with the requirements of financial disclosure standards. However, the company’s performance maintains improvement on profitability and cash flow levels.
 

Moreover, occupancy rates and the average room rate in the group’s hotels during the second quarter of this year were close to expectations. The CEO mentioned that the period from the last ten days of Ramadan to the Eid, as well as the exams period, has a direct impact on occupancy rates in the group’s hotels, especially in major areas like Riyadh, Jeddah, and the Eastern Province.
 

The company added several entertainment concepts to its portfolio recently, including Playocity in The Village Mall in Jeddah. It also works on the continuous development of owned entertainment brands to include the latest entertainment content to compete on a global scale.
 

He indicated that the company is working on developing existing entertainment centers and hotels. It has completed the development of its branches in Panorama Mall in Riyadh and Red Sea Mall in Jeddah and continues to seek new opportunities that enhance its performance.
 

Al Obailan mentioned that the company is about to announce details of the transformation program it has been working on in the coming weeks. The program is expected to contribute to raising performance levels by improving efficiency and operational performance.
 

On the impact of increased revenue from the entertainment sector on the company’s performance, Al Obailan confirmed that the company is deemed as one of the leading players in the Saudi and GCC entertainment sector. Entertainment is a core pillar in the group's activities, and is a main contributor to the topline portfolio. Therefore, an increase in the sector’s revenue has a direct positive impact on the overall performance of the company.