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SRC Prepares to Offer Global Dollar-Denominated Sukuk

Chief Business and Markets Officer at Saudi Real Estate Refinance Company (SRC) Majeed Abduljabbar (Asharq Al-Awsat)
Chief Business and Markets Officer at Saudi Real Estate Refinance Company (SRC) Majeed Abduljabbar (Asharq Al-Awsat)
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SRC Prepares to Offer Global Dollar-Denominated Sukuk

Chief Business and Markets Officer at Saudi Real Estate Refinance Company (SRC) Majeed Abduljabbar (Asharq Al-Awsat)
Chief Business and Markets Officer at Saudi Real Estate Refinance Company (SRC) Majeed Abduljabbar (Asharq Al-Awsat)

Chief Business and Markets Officer at Saudi Real Estate Refinance Company (SRC) Majeed Abduljabbar revealed that his company is planning to issue dollar-denominated sukuk. The move aims to attract foreign investments and protect portfolios through issuing mortgage-backed securities.

This will ensure the flow of investments and secure the necessary liquidity to support the growth of the sector.

Abduljabbar said that SRC seeks to be a major supporter within the housing system. He stressed the company wanting to help the Kingdom achieve its goal of 70% of citizens owning homes by 2030.

SRC has already helped Saudi Arabia raise its rate of citizen home ownership from 47% to 60%.

Since its establishment in 2017, SRC has witnessed strong growth in its business and partnerships in the real estate financing sector.

This growth is part of the various initiatives and programs that the housing sector in Saudi Arabia is witnessing, keeping pace with the goals of the national transformation plan, Vision 2030.

Abduljabbar stressed that within the context of its development role, SRC and its partners from the financing agencies play an important role in helping to reduce the burden on capital and lessen global financial and real estate risks in the future.

“However, the company always strives to balance profits, with the aim of obtaining a fair profit for the purpose of sustainability and achieving its strategy in the real estate market,” said Abduljabbar.

“The objective of establishing SRC is to support liquidity in the real estate finance market to ensure the realization of Vision 2030 in promoting citizens’ ownership of their homes,” he affirmed.

“SRC plays a supportive role in providing liquidity and capital and risk management solutions to financing agencies,” he explained.

“We have worked to provide new sources of financing in the real estate finance market locally and globally.”

“SRC also contributes to supporting the objectives of the financial sector development program by providing real estate refinancing products.”

Abduljabbar clarified that SRC offers refinancing products by purchasing portfolios and finding financing solutions and an effective secondary market. It also does so by actively contributing to the growth of the debt instruments market to increase the diversification of financing options for the private sector and creating a new class of assets for investors.

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Revenue Growth, Improved Operational Efficiency Boost Profitability of Saudi Telecom Companies

A man monitors the movement of stocks on the Saudi Tadawul index. (AFP)
A man monitors the movement of stocks on the Saudi Tadawul index. (AFP)
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Revenue Growth, Improved Operational Efficiency Boost Profitability of Saudi Telecom Companies

A man monitors the movement of stocks on the Saudi Tadawul index. (AFP)
A man monitors the movement of stocks on the Saudi Tadawul index. (AFP)

Telecommunications companies listed on the Saudi Stock Exchange (Tadawul) achieved a 12.46 percent growth in their net profits, which reached SAR 4.07 billion ($1.09 billion) during the second quarter of 2024, compared to SAR 3.62 billion ($965 million) during the same period last year.

They also recorded a 4.76 percent growth in revenues during the same quarter, after achieving sales worth more than SAR 26.18 billion ($7 billion), compared to SAR 24.99 billion ($6.66 billion) in the same quarter of 2023.

The growth in the revenues and net profitability is the result of several factors, including the increase in sales volume and revenues, especially in the business sector and fifth generation services, as well as the decrease in operating expenses and the focus on improving operational efficiency, controlling costs, and moving towards investment in infrastructure.

The sector comprises four companies, three of which conclude their fiscal year in December: Saudi Telecom Company (STC), Mobily, and Zain Saudi Arabia. The fiscal year of Etihad Atheeb Telecommunications Company (GO) ends on March 31.

According to its financial results announced on Tadawul, Etihad Etisalat Company (Mobily) achieved a 33 percent growth rate of profits, bringing its profits to SAR 661 million by the end of the second quarter of 2024, compared to SAR 497 million during the same period in 2023. The company also achieved a 4.59 percent growth in revenues to reach SAR 4.47 billion, compared to SAR 4.27 billion in the same quarter of last year.

The Saudi Telecom Company achieved the highest net profits among the sector’s companies, at about SAR 3.304 billion in the second quarter of 2024, compared to SAR 3.008 billion in the same quarter of 2023. The company registered a growth of 4.52 percent in revenues.

On the other hand, the revenues of the Saudi Mobile Telecommunications Company (Zain Saudi Arabia) increased by about 6.69 percent, as it recorded SAR 2.55 billion during the second quarter of 2024, compared to SAR 2.39 billion in the same period last year.

Commenting on the quarterly results of the sector’s companies, and the varying net profits, the head of asset management at Rassanah Capital, Thamer Al-Saeed, told Asharq Al-Awsat that the Saudi Telecom Company remains the sector leader in terms of customer base expansion.

He also noted the continued efforts of Mobily and Zain to offer many diverse products and other services.

Financial advisor at the Arab Trader Mohammed Al-Maymouni said the financial results of telecom sector companies have maintained a steady growth, up to 12 percent, adding that Mobily witnessed strong progress compared to the rest of the companies, despite the great competition which affected its revenues.

He added that Zain was moving at a good pace and its revenues have improved during the second quarter of 2024. However, its profits were affected by an increase in the financing cost by SAR 26.5 million riyals and a rise in interest, while net income declined significantly compared to the previous year, during which the company made exceptional returns.