Annual report eng.2019

Honourable Shareholders The prominent commercial brand of Al Mazaya Holding carries great weight in the real estate industry after the company has successfully left a strong imprint through its distinguished projects at the local and international levels over the past sixteen years, during which the company has made resounding successes in a number of Arab countries and Turkey thanks to the credentials it boasts and which qualify the company to access any real estate market worldwide, through an integrated business model and highly qualified administrative teams in addition to an impressive portfolio of distinguished real estate projects. Ladies and Gentlemen, In this regard, it’s our sincere pleasure to present you with the annual report of your company for the fiscal year ended on December 31, 2019, in which, as is the case always, we present a quick summary of the key milestones at the operating and financial levels. Al Mazaya Holding - thanks to Almighty Allah – achieved a total operating revenues of about KWD 27.86 million by the end of 2019 compared to KWD 22.06 million at the end of 2018, driven by successful sales and leasing operations which resulted in leasing revenues of KWD 8.73 million by the end of 2019 compared to KWD 8.38 million in 2018. The company secured KWD 7.02 million in leasing profits by the end of 2019 compared to KWD 6.75 million in 2018. Sales revenues increased by nearly 40% to KWD 19.08 million in 2019 from KWD 13.58 million in 2018, which demonstrates the company’s resounding success in addressing the markets affected by the current conditions. However, the increased sales amidst the drop in real estate prices in the aforementioned affected markets triggered total losses of KWD 8.77 million by the end of 2019. Distinguished Shareholders, Al Mazaya Company has solid assets of KWD 229.34 million by the end of 2019 compared toKWD225.62million in 2018, while total ownership rights dropped to KWD92.98million by the end of 2019 fromKWD 104.12million in 2018. In accordance with the Corporate Governance Rules, Al Mazaya Holding Board of Directors acknowledges and guarantees the integrity and authenticity of the company's financial statements along with all the reports submitted to Shareholders that include the company's financial profile, data and operating results. Brothers and Sisters Allowme to review the achievements made by the company during the past year, thanks to an integrated business plan that included three tenets, which enabled us to achieve the aspired financial and operating results. The first tenet is to reduce the company’s presence in the real estatemarkets affected by the current difficulties. The company was able to sell the majority of the units of the Q-Zone project in the Dubailand, which consists of 328 apartments, after the full completion of the project, in addition to selling 110 apartments in Q-Point and Q-Line. In Istanbul, the company succeeded in selling 50 apartments in the Ritim Istanbul Project. The company also sold 23 apartments at Mazaya Residence in the Sultanate of Oman, thus managing to reduce its economic exposure in the Dubai and Turkey markets. The second tenet is restructuring and the company's debt. Al Mazaya has succeeded in fulfilling all the company's financial obligations for banks and contractors. We have been determined to achieve the best financial results by reaching convenient agreements with our lenders to schedule current, medium and long-term debt. The third tenet is enhancing thecompany’soperationsby raising occupancy rates in the projects under leasingwhile completing the projects under development in addition to launching new projects in themedical sector. The company has succeeded in achieving a 100% occupancy rate in its current medical projects, including Clover Medical Centre in Jabriya, the Wara Hospital in Sabah Al-Salem and Mazaya Clinic 3 in Bneid Al-Qar. Up to 98% and 90% occupancy rates have been achieved in Al Mazaya Towers in Kuwait City and the Sky Gardens in the Dubai International Financial Centre, respectively. A 100% occupancy rate was achieved in the Indigo despite the challenges besetting the UAE real estate market; the company also maintained an occupancy rate of 60% in the Ritim Istanbul, in addition to a 100% occupancy rate in the Mazaya Logistics in Bahrain and an average occupancy rate of 70% in its projects in Saudi Arabia. The company has been able to maximize gains from its projects in the healthcare sector in a manner that ensures the optimal utilization of available and income-generating opportunities, by introducing new projects in the medical sector in 2019, including the “Mazaya Clinic 4” and “Mazaya Clinic 5” projects, both of which are complimentary to the Al Mazaya Clinic Series, which are specialised in this important and vital sector that secures significant returns for the company. We’ve succeeded in completing Al Mazaya’s under- development projects, creating a solid ground for the company toriseagaininthecomingyearwithoutanyfinancialorlogistical obligations towards all the markets in which it operates. Finally, we can safely say that the well-thought-out strategies adopted by Al Mazaya have cemented the financial position of the company and will ensure balanced cash flows during thecurrent year.Wewill adhere toourprecautionarymeasures andwell-calculated steps to survive the rapid geopolitical and economic challenges surrounding the Middle East region, as well as tirelessly continue towork to establish a new stage that meets the growing demands of the coming years. Dear Shareholders, In conclusion, I would like to extend my sincere thanks and gratitudetoallofyouforyoursupportaswellasmyappreciation to all those who’ve contributed to the company's prestigious status, remarkable achievements and coveted branding. Many thanks to all our Board members, and our colleagues in Al Mazaya Holding! May God's peace, mercy and blessings be upon you all! ANNUAL REPORT 2019 03