Knowledge City reports SR6.7 mln losses in 1Q

Knowledge Economic City announced that its losses after zakat and tax surged 41.5% to SR 6.7 million in the first quarter of 2022 compared to 4.7 million during the same period of 2021.

This came after Knowledge City announcement on Sunday of the preliminary financial results for the period ending on 31.03.2022 (three months).

The company’s operational loss rose 175.7% to SR 5.9 million in the 1^st quarter of the current year from SR 2.13 million in the same period of the previous year.

Gross profit of Knowledge City declined 25.7% to SR 4.9 million in the first quarter of this year from SR 6.6 million a year ago, while the loss per share soared to SR 0.02 from SR 0.014.

The increase in the net loss of the current quarter as compared to the same quarter in the previous year is mainly due to the decrease in revenue in the current quarter. Gross profit of the current quarter has also decreased compared to the same quarter of the prior year by SR 1.7 million, mainly because the revenues of the same quarter of the previous year had included the sales generated from selling most residential units belongs to one of the Group revenue generating projects. However, the Group had also started the sale of a new residential project “Townhouse” from December 2021 which will have positive impact on the revenue for the upcoming periods. Moreover, due to the commencement of the construction of two new anchor projects i.e. KEC Hub and Madinah Gate, the operational expenses have also increased, which resulted in an increase in net loss.

The reduction in the net loss during the 1st quarter of this year 2022 as compared with the previous quarter in 2021 is mainly due to the decrease in the operational expenses related to two new anchor projects i.e. KEC Hub and Madinah Gate in the current quarter compared with the last quarter.

Additional Information:

During the year ended December 31, 2021, the Group has signed an agreement with the Tourism Development Fund and Riyad Bank to provide Shariah compliant facility to an extent of Saudi Riyals 782 million collectively for development execution of the KEC Hub project.

On March 8, 2022, the Group has withdrawn facilities from TDF and Riyad Bank collectively amounting to Saudi Riyals of 150 million.