Knowledge Economic City reports SR4.6 net profit in Q3‎

The Knowledge Economic City Company achieved a net profit after zakat and tax in the third quarter of 4.6 million riyals, compared to a loss of 2.5 million riyals in the same quarter of last year (9 months).

The operational loss amounted to 7.3 million riyals in the third quarter, compared to a profit of 145 thousand riyals in the same quarter of the previous year.

In the 9-month period, the company recorded a net loss after zakat and tax of 10.7 million riyals, compared to 2.5 million riyals in the same period last year, a growth of 317%.

The total shareholders’ equity “without minority rights” amounted to 3.06 billion riyals in the current period, compared to 3.09 billion riyals in the same period last year, a decrease of 0.98%.

The loss per share in the current period amounted to 0.03 riyals, compared to 0.01 riyals in the same period last year.

The net profit of this quarter compared with the loss for the same quarter in last year due to higher sales in this quarter compared with the same quarter last year resulted in the increased in gross profit, also the current quarter includes the income from derivative instruments amounting to Saudi Riyals 11.8 Million.

Increase in the net profit of the current quarter as compared with net loss in the previous quarter of the current year (Q2, 2022) is mainly due to income from derivative instruments amounting to Saudi Riyals 11.8 Million.

Additional Information:

During the year 2021, the Group had signed an agreement with the Tourism Development Fund and Riyad Bank to provide Shariah compliant bank facility to an extent of Saudi Riyals 782 million collectively for development works of the KEC Hub project. The utilization of these facilities started during the year 2022.

During the three-months period ended 30 September 2022, the Group entered into a profit rate swap agreement (the “Swap Contract”) with Riyad bank to hedge the future fluctuation in profit rates on the said loans. The said arrangement has been designated as Derivative Financial Instruments measured at fair value through profit or loss.