Emaar EC cuts accumulated losses by nearly 54%

• Critical part of optimisation plan
• Share capital reduced
• First-half losses increased

Emaar the Economic City (Emaar EC) has cut accumulated losses without disrupting business operations after shareholders approved a capital decrease.

Abdulaziz Ibrahim Alnowaiser, CEO of the master developer of King Abdullah Economic City (KAEC) in Saudi Arabia, said: “The capital decrease is a critical enabler of our capital optimisation plan.”

The approved capital cuts will reduce the company’s share capital of SAR11.3 billion ($3.01 billion) by 53.83 percent to extinguish SAR6.1 billion of accumulated losses as of September 30, 2024. The accumulated losses balance now stands at SAR7 billion.

The capital cut will involve cancelling 0.5383 shares for every share owned, with the revised share capital at SAR5.2 billion.

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In September, Emaar EC initiated a SAR8.7 billion turnaround plan a month after its 2024 first-half losses showed an almost five-fold increase from the previous year.

The move will allow the Saudi-listed company to restructure its SAR3.8 billion bank facilities.

SNB Capital will be the financial adviser, and Khoshaim & Associates will be the legal adviser for the capital cut strategy.