LONDON: Damac Properties reported a second consecutive quarterly income decline after property development sales fell sharply.
The developer behind the only Trump-branded golf course development said total comprehensive income declined 19 percent to 704.8 million dirhams ($191.9 million) as the money it earned from property development fell.
Second-quarter revenue dropped to 1.57 billion dirhams from 1.75 billion dirhams a year earlier. Hussain Sajwani, chairman of Damac Properties, gave an upbeat assessment of the market despite the decline in sales.
“The property market in Dubai continues to demonstrate further stabilization, and our medium- to long-term outlook remains positive as Damac continues to develop innovative products that appeal to both end users and investors,” said Sajwani.
Damac is developing thousands of new homes across three main projects in the emirate — Aykon City, Damac Hills and Akoya Oxygen.
It delivered 1,071 units at its Damac Hills project in the first half of the year, bringing the total number of homes handed over to 3,100.
In February, the developer opened its flagship Trump International Golf Club Dubai, the first Trump-branded course to be developed in the Middle East.
Damac is currently building about 5,000 villas at its Akoya Oxygen master community in Dubailand, with a further 1,300 villas scheduled to begin construction in September 2017, the developer said.
Work is also nearing completion on Damac Towers by Paramount Hotels & Resorts, a four-tower, 250-meter high development consisting of over 2,000 units in the Business Bay district. Damac said property development revenues fell to 925.9 million dirhams in the second quarter, compared to 1.44 billion dirhams a year earlier.
However, land sales rose to 644.2 million dirhams from 312.8 million dirhams over the same period.
Damac reports decline in property development sales
Damac reports decline in property development sales
Saudi entrepreneurs launch fintech startup to spur open banking growth in GCC
JEDDAH: Fintech startup Thimsa aims to streamline business payments with direct bank transfers as it launches a beta platform in the UAE and Bahrain, targeting the region’s open banking growth.
Co-founded by two Saudi entrepreneurs along with a financial expert, the startup seeks to facilitate instant B2B pay-ins and payouts, while also offering eInvoice and subscription features.
The projected growth of open banking in the Gulf Cooperation Council countries has motivated Rayan Azab and Salah Khashoggi to partner with Dubai-based fintech entrepreneur Ash Kalra to spearhead this venture after four years of market research.
This comes as open banking is projected to account for over $124 billion worth of transactions in the GCC region alone by 2031, up from $14 billion in 2020, with an annual growth rate of 22 percent, according to a report by Allied Market Research.
Sharing the story behind Thimsa with Arab News, Azab said: “The journey took about three to four years, but realistically, we started this year with the different experience we have.”
He added that they have studied the market and know that fintech usage in the region is one of the highest in the world thanks to a young, vibrant generation across the GCC.
“We have advised and partnered with in a couple of other fintech companies, and then we decided (to found the company) since the open banking regulation has been implemented in the last few years,” Azab said.
The entrepreneur added that the process has become easier over time, highlighting their decision to enter the open banking sector now as the reason behind founding Thimsa. He noted that the partners possess diverse experiences, which he believes will contribute to their success.
“We are three partners. Kalra has fintech experience in Canada and the US for over 12 years, and I have been in the business world for over 14 years. Additionally, I have an advisory company aside from Thimsa. Salah Khashoggi, founder of Tamra Capital, is also part of our team and brings his expertise from Saudi Arabia,” he added.
Through open banking, the company states that its platform can access shared financial data via 350 integrated APIs, enabling businesses to streamline processes, create personalized financial services, and adapt to ever-evolving customer needs.
Additionally, the fintech firm emphasized that its solution can accept payments in over 60 currencies from more than 150 countries.
Explaining their decision to launch the payment management platform in the UAE and Bahrain first, Azab told Arab News that they wanted to test it in smaller markets before entering larger ones like Saudi Arabia.
He added that they are aligning their efforts and developments with the regulatory changes and expansions made by the local regulator as it enhances its framework.
“Saudi Arabia has recently advanced its open banking initiatives and is poised to become a regional leader in open banking," he explained.
Highlighting the potential impact of open banking growth in the GCC on their trajectory, Azab mentioned that the segment is already established in the region, and they are not introducing something entirely new.
“We are just revamping it. Thimsa is going to come and help small businesses that cannot afford to just go and do the huge accounting or whatever,” he said, adding that they will be adding value to these businesses.
Talking about their platform, he explained that the technology features instant payment management, corporate management, and most importantly, business-to-business and customer-to-business features.
Azab concluded by stating that they have encountered many challenges, but they have gained significant experience in understanding the market and its growth trajectory. Additionally, he mentioned that they are working closely with regulators.
Envisioning the platform changing the financial services landscape for GCC businesses, Khashoggi told Arab News that the region, particularly Saudi Arabia, is undergoing a massive transformation in fintech and financial inclusion.
“We want to focus on enabling SMEs (small and medium enterprises). So, the idea behind Thimsa is how to help all these SMEs, making financing available to them in addition to easing their operations. All of this is a result of open banking,” Khashoggi said.
The co-founder added that without open banking regulations in Saudi Arabia, they could not have or even come up with something like Thimsa.
Speaking about their future expansion plans, Khashoggi emphasized that their primary focus is on product development. He explained that once they have demonstrated success in Saudi Arabia and the GCC region, they will aim to expand their product offerings to the global market.
He pointed out that the beauty of fintech lies in its integration with the digital economy, making it one of the most easily exportable products globally. However, he noted that it is crucial to remain attentive to market demands.
“So, if you want to expand to any other market, you need to localize the product to fit their needs,” he said.
He emphasized that their strategy involves perfecting their product here in Saudi Arabia first before confidently venturing into international markets.
Asked how Thimsa can ensure the security and privacy of its users’ information, given the extensive use of financial data, he stated that this is entirely under the control of the regulator.
“The regulator sets the bar very high when it comes to sharing any data. We are entrusted by our clients with their data for their benefit. We are not going to take it and use it or sell it or do anything with it. All of that is not allowed by the regulations. We will only use it for the benefit of the client,” he said.
For his part, Kalra described Thimsa as a state-of-the-art financial management platform, emphasizing that it is based on the core principles of open banking and finance.
“Open banking aligns very well with the Vision 2030 in Saudi Arabia, and it runs on real-time payment rails. So that means it spurs innovation, growth, and inclusiveness all across the market,” he said.
Highlighting the open banking landscape in the GCC market, particularly in Saudi Arabia, and discussing whether they will be competing with banks, Kalra commented: “Open banking is a technology which allows banks to share their data with third parties like us, which spurs innovation and growth in the market.
“For the Saudi market, that’s a huge deal. So, one of the pillars of Vision 2030 is diversifying the economy, and open banking just does that,” he said.
Kalra added that it allows the incumbent banks to work with third parties like them, and said: “So we are not competing against the banks, we are actually working with them.”
Describing the technology and how their platform would make payment management easier, he said that Thimsa uses a microservices architecture and API-based technology.
“We collect a lot of data from the bank on the businesses and consumers and innovate around it. So, that is a key technology that Thimsa uses,” he concluded.
Saudi youth set to lead the charge for project management: PMOGA MD
RIYADH: Saudi Arabia’s drive toward a brighter future is significantly impacting today’s youth and tomorrow’s leaders in the project management sector, according to a top official.
Speaking to Arab News during the Global Project Management Forum in Riyadh, Americo Pinto, managing director of the Project Management Office Global Alliance, highlighted the young people in the Kingdom as the cornerstone for substantial development.
The two-day annual event being held in the Saudi capital highlights the latest developments in the field of project management across various sectors and is set to attract more than 2,000 participants.
Pinto observed a proactive approach in the region toward preparing future leaders, and said: “I really see a region and a country (Saudi Arabia) that is looking to prepare their leaders for the future, and the future is now.”
He added that he believes the impact of the investments and cultural changes will be evident for years to come.
Reflecting on the region’s unique energy and enthusiasm for project management, Pinto stated: “It’s something that is interesting to observe from a little distance, especially comparing with other regions where maybe we have project management as something more mature in terms of topic.
“But here I feel a different kind of energy and it makes me really happy because it’s great to be part of it.”
Pinto expressed a particular enthusiasm for working with individuals from the Middle East, specifically Saudi Arabia.
“I have a special joy in working with people from the Middle East and Saudi Arabia. I see people, especially young leaders, seeking knowledge and exchange experience,” he remarked.
Pinto further highlighted that the Middle East region currently holds the highest number of PMOGA members, indicating great potential for PM development.
Moreover, Pinto stated that Saudi companies have been an active participant in the annual PMO Global Awards, with the Kingdom’s Saudi Post, also known as SPL, winning the World PMO of the Year in 2023.
“It’s interesting that each year we have more companies from Saudi Arabia participating. Last year, we had nine, this year we have 20. I don’t know, but in a few times, it will become the Saudi Arabia awards,” he quipped.
Speaking about industry trends, Pinto explained that artificial intelligence represents the most significant trend in the project management sector.
The technology presents a multitude of possibilities and is rapidly becoming essential for companies seeking to enhance their operations and overall results, he explained.
“Every company should embrace AI as a great possibility to increase activity and results as a whole,” Pinto noted, emphasizing the transformative potential of AI in the project management office.
Pinto added, “PMO leaders should be very concerned about that (AI), but as I said, in a positive way, because it can bring a lot of benefits for any PMO.”
He highlighted the importance of PMO leaders recognizing AI’s potential to significantly impact their area, ultimately leading to greater efficiency and effectiveness in project management.
Pinto anticipates that AI will be used for calculating possibilities and predicting outcomes in recent years.
“AI is something that will change the game. It will enable us to do things we cannot do today,” he stated.
Founded in 2017, PMOGA is a global community with more than 17,000 members in more than 125 countries. The alliance was acquired by the Project Management Institute, the leading authority in project management, earlier last year.
Global LNG supply to increase by 80% by 2030: Goldman Sachs
RIYADH: The global liquefied natural gas supply is set to surge by 80 percent by 2030, driven by new projects in Qatar and North America, a new analysis showed.
In its latest report, Goldman Sachs said that this robust rise in supply would bring an end to the current energy crisis following Russia’s invasion of Ukraine.
The US-based financial services firm also highlighted that investments in LNG are projected to increase by over 50 percent by 2029.
Michele Della Vigna, Goldman Sachs’ head of natural resources research in Europe, the Middle East and Africa, said: “LNG in the US, without any doubt, is dominating future supply and we believe that the capacity growth in LNG is going to bring an end to the energy crises that began a couple of years ago, following European sanctions on Russian gas after the invasion of Ukraine, and work to lower natural gas prices in Europe and Asia.”
He added: “We’re projecting an 80 percent increase in global LNG supply by 2030, which will be driven by new projects in North America and Qatar.”
In January, QatarEnergy signed an agreement with US-based Execelerate Energy to supply up to 1 million tonnes per annum of LNG to Bangladesh for 15 years.
Similarly, in February, Qatar’s state-owned firm signed another agreement with Petronet to supply 7.5 mtpa of LNG to India for a period of 20 years.
In the same month, QatarEnergy chief Saad Al-Kaabi announced a new expansion of its LNG production in the North Field, which will add a further 16 mtpa to existing capacity, bringing total production to 142 mtpa.
The Goldman Sachs analysis further pointed out that the oil and gas industry is undergoing a major transformation as it braces for the eventual long-term decline in crude demand and rising global need for natural gas.
According to the report, oil companies are still likely to reap attractive returns for shareholders, as well as good per-share growth if crude prices stay between the range of $80 to $90 per barrel.
Goldman Sachs highlighted that capital expenditure in the oil and gas industry grew at about 11 percent a year from 2020 to 2023, but it is likely to level off to around 4 percent a year from 2023 to 2026.
The analysis suggested the Organization of the Petroleum Exporting Countries is likely to maintain its current production discipline for the next few years.
“In the next two to three years, there is very little opportunity for OPEC to increase production capacity without rocking the market. We think non-OPEC production will peak this year, and then OPEC can potentially begin increasing its market share as decline rates rise and the project pipeline normalizes,” added Goldman Sachs.
China leading affordable EV market amid global transition challenges: S&P report
RIYADH: China is at the forefront of providing affordable electric vehicles, supported by government backing and a wide range of low-cost options, according to a new study.
Despite a global slowdown in the transition to EVs, a report by S&P Global Ratings and S&P Global Mobility highlighted the effectiveness of the Asian country’s efforts, pointing to several key factors.
China’s competitive edge in this market is largely attributed to the near price parity between battery-EVs and internal combustion engine vehicles.
In the first quarter of 2024, China saw a BEV penetration rate of 25 percent, showcasing rapid adoption driven by low manufacturing costs and strong government incentives.
In contrast, Western markets face hurdles due to higher costs and diminished subsidies. In Europe and the US, BEVs are still significantly more expensive than their ICE counterparts, with Europe experiencing a 24 percent manufacturer’s suggested retail price premium and the US facing a 37 percent difference.
Additionally, concerns over range, charging infrastructure, and technological obsolescence further dampen consumer enthusiasm, the report added.
While Western automakers are developing more affordable models, such as the VW ID2 and Renault Twingo, these vehicles are not expected to hit the market until 2025-2026 and will only represent a small portion of available options, according to S&P.
The high cost of battery packs, which make up around 40 percent of an EV’s price, remains a significant barrier to affordability.
Despite these challenges, regulatory changes and environmental policies are expected to drive long-term growth in the BEV market.
The EU and China have set ambitious targets for emission reductions and EV adoption, with Beijing aiming for 50 percent “new-energy” vehicle sales in key regions by 2030.
As the global market adapts, the automotive supply chain is undergoing a transformation, with battery technology and production becoming central to the industry.
While China currently dominates this sector, the report stated that efforts in Europe and the US to localize production and develop alternative battery technologies are underway.
The Middle East is also seeing a focus on growing the EV sector, with Saudi Arabia looking to lead the region in this regard.
In 2022, Crown Prince Mohammed bin Salman launched Ceer, the Kingdom’s first automotive brand, to produce and sell EVs, aiming to attract investments, create jobs, and boost gross domestic product in line with Vision 2030.
Saudi Arabia's Public Investment Fund is also the major shareholder in EV manufacturer Lucid, which opened its first plant outside the US in the Kingdom in September 2023, with an initial capacity to produce 5,000 vehicles a year.
This came as the Kingdom’s government pledged to buy up to 100,000 EVs from the company over 10 years.
Saudi Arabia has set a goal to transition 30 percent of all vehicles in Riyadh to electric by 2030. This target is part of a larger strategy to reduce emissions in the capital city by 50 percent, aligning with the Kingdom’s objective of achieving carbon neutrality by 2060.
Aramco commences secondary public offering of 1.55bn shares
- Energy giant offers more than $10 billion worth of shares
RIYADH: Energy giant Aramco has begun the sale of more than $10 billion worth of shares in what is the second public offering from the Saudi-based firm.
The 1.55 billion holdings on offer represent 0.64 percent of the company’s issued shares, and in a Tadawul statement the oil firm revealed that the price range has been set between SR26.70 and SR29 ($7 to $7.70) per share.
The book-building process for institutional investors in the secondary offering will run from June 2 to 6, while the period for retail investors will run from June 3 to 5.
This marks the firm’s second listing after its initial public offering in December 2019, which raised $25.6 billion, the largest flotation in history.
“The offering will be made to institutional investors in Saudi Arabia, institutional investors located outside Saudi Arabia who are qualified in accordance with the Rules for Foreign Investment in Securities to invest in listed securities and eligible retail investors in the Kingdom and other GCC (Gulf Cooperation Council) countries,” stated Aramco in a press release.
It added: “Outside the Kingdom, the Offering will be made in compliance with Regulation S under the US Securities Act of 1933.”
Regulation S is a series of rules that clarify the position of the US Securities and Exchange Commission that securities offered and sold outside the US don’t need to be registered with the SEC.
The sale was initially announced on May 30, with a statement adding that the Saudi government currently holds 82.19 percent of the company’s issued shares.
Upon closure of the secondary offering, the government will hold approximately 81.55 percent of the firm’s issued shares if the over-allotment option is not exercised.
Investment banks added to the deal since it was announced on Thursday are Credit Suisse Saudi Arabia - part of UBS Group - as a domestic bookrunner alongside BNP Paribas, Bank of China International and China International Capital Corporation as foreign bookrunners, according to a stock exchange filing.
Already on the deal were Saudi National Bank's investment banking arm, which is the lead manager as well as global coordinator alongside Citi, Goldman Sachs, and HSBC, as well as JPMorgan, Bank of America and Morgan Stanley.
Al Rajhi Capital, Riyad Capital and Saudi Fransi are also domestic joint bookrunners.
In April, a survey conducted by UK-based Brand Finance named Aramco the most valuable brand in the Middle East, with a value of $41.5 billion.
In May, the Saudi oil firm revealed its net profit for the first quarter of this year reached $27.27 billion, a rise of 2.04 percent compared to the last three months of 2023.
According to the statement, Aramco’s total revenue for the three months to the end of March stood at $107.21 billion, with total operating income for the period reaching $58.88 billion.
