Lower land sales weighed on Dar Al Arkan's Q2 profit

Dar Al-Arkan Real Estate Development Co.’s (Dar Al-Arkan) second-quarter net profit (SAR 43.2 million) was negatively impacted by a drop in land sales, the company said in its detailed financial statements.

Land sales, which usually account for more than 90 percent of the company’s total revenues, dropped to SAR 370.6 million in Q2, compared to SAR 495 million in the same period last year.

The company’s quarterly land sales had exceeded SAR 1 billion in 2009 and 2010, but began to decline to over the last few years to reach around SAR 518 million in 2015.

Dar Al-Arkan’s leasing segment saw a SAR 4 million rise in sales revenue year-on-year (YoY) in Q2; however, sales growth and profit margins in this segment were nearly flat quarter-on-quarter.

The real estate developer earlier reported a net profit of SAR 101 million for the first half of 2016, a 54 percent YoY drop. Lower income from investments in affiliates also weighed on results during the period.