RIYADH: –Riyadh Development Company (ARDCO) today announced that its Board of Directors’ meeting held on Tuesday has recommended the distribution of dividends to its shareholders. The company will distribute SAR44,444,444.25 in cash dividends for the second half of 2022.

The move is in line with ARDCO’s recently announced strategy that aims at striking a balance between dividend distribution and sustainable growth. The company will distribute cash dividends for each of the 177,777,777 eligible shares for the six months ending December 31, 2022, at a rate of SAR0.25 per share, or 2.5 percent of its nominal value.

The date of entitlement, ARDCO said, will be the end of the day after the general assembly has convened, and the eligibility will be to those shareholders who owned shares on that day, as shown in the records with the Securities Depository Center Company at the end of the second trading day following the date of the assembly. The assembly date will be announced later.

According to the statement, ARDCO has achieved a net profit of SAR300.4 million during H2 of 2022, indicating a 6 percent drop compared to the same period previous year. This stems mainly from a 16-percent decline in revenues of Tanal, an associate company, due to a drop in land sales compared to previous year, despite an increase in average sale prices. 

Additionally, the cost of goods sold increased by 14 percent as a result of the company’s spending on required maintenance to upgrade its assets and obtain mandatory safety certificates. Also, the company attracted new talents in its operational team to enhance efficiency. Zakat expenses have increased as well by 36 percent compared to previous year to reach SAR12.6 million despite a drop in general & administrative expenses by 10 percent compared to previous year.

Operating revenue saw a significant increase of SAR8 million, which came as a result of the acquisition of an office building during the fourth quarter of the year, that improved efficiency and occupancy rates in the company’s assets, reaching 93 percent. Also, there was a significant increase in the profits of Islamic Murabaha deposits by 469 percent as a result of the increase in interest rates and overall increase in Murabaha investments compared to previous year.

“We are committed to move forward towards sustainable growth through diversified investments, increased asset revenues, a stronger focus on real estate development and management, and continued leadership in the public good services sector,” said Jehad Alkadi, ARDCO’s Chief Executive Officer. “The company is aiming to maximize shareholder returns through dividend distributions and capital gains, as well as balancing its real estate, fresh produce, and commercial center operations.”

Alkadi added: “During 2022, we focused on the company’s corporate and infrastructure development for better efficiency, as well as building a prudent strategy that revolves around strategic partnerships, digitization, and sustainability in its broader sense.“

During the past year, the company divested its entire Tadawul portfolio for SAR61 million, with a profit of SAR27 million, which was later transferred from comprehensive income to retained earnings in accordance with IFRS No. 9.

Established in accordance with Royal Decree M/2 on 28 July 1993, Riyadh Development Company is a publicly listed company that invests in real estate development. Among its many lines of activity, the company builds, operates, and runs public good projects in partnership with the government. The company has built and continues to run several public good services projects that employ 150 Saudis, cover over 2,000 tenants, and serve more than 20 million people.