Dubai: Marka released its third quarter financial results on Tuesday, reporting a net loss of Dh22 million, an improvement of sorts given the company’s losses of Dh126 million in the second quarter of 2017.
The company’s total revenue fell sharply, however. the Dubai-based retailer posted a total revenue of Dh23 million for the third quarter, compared to Dh65.9 million for the same period of 2016, a drop of 65 per cent.
Last year’s result was itself a decrease of 15 per cent compared to the same period in 2015.
In August, Khalid Jasem Bin Kalban, Marka’s chairman, said in a statement: “Over the past 12 months, Marka has faced unprecedented changes in the region’s retail markets, driven by changing consumer behaviour and geopolitical influences.”
Marka has aggressively expanded in recent years against a backdrop of a weakening consumer segment, exacerbated by a low oil price environment, and a drop in tourist spending.
Consequently, the retailer has failed to record a profitable quarter since it was listed on the stock market in 2014.
Marka reported a loss of Dh88 million for 2016, despite the company’s vice-chairman and managing director, Khalid Al Muhairi, assuring investors at the end of 2015 that the company intended to become profitable last year.
In 2017, Marka has embarked on a major cost-cutting programme, with a reduction of 75 per cent of its general expenses compared to the last quarter.
It says that these results reflect “the progress the company is making.” The retailer has reduced its expenses from Dh45 million in the second quarter to Dh11 million this quarter.
Marka added that it had made strong operational changes that were moving the company towards long-term financial improvement.
According to the release that accompanied the results, the firm has seen strong operational development in its food and beverage brands.
Bin Kalban said in a separate statement with the results: “The company is maintaining a strict cost control programme and making strong operations improvements. With the steady progress made across all brands, we are in a better position to envisage the future with confidence.”