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Jabal Omar Development Co. announces its Interim Financial Results for the Period Ending on 2023-03-31 ( Three Months )

ELEMENT LISTCURRENT QUARTERSIMILAR QUARTER FOR PREVIOUS YEAR%CHANGEPREVIOUS QUARTER%CHANGE
Sales/Revenue317.09109.65189.18239.5832.35
Gross Profit (Loss)122.25-25.74--27.73-
Operational Profit (Loss)102.13-72.23--66.94-
Net Profit (Loss) after Zakat and Tax11.93-182.46--194.45-
Total Comprehensive Income11.93-182.46--197.61-
All figures are in (Millions) Saudi Arabia, Riyals

ELEMENT LISTCURRENT PERIODSIMILAR PERIOD FOR PREVIOUS YEAR%CHANGE
Total Share Holders Equity (after Deducting Minority Equity)12,697.08 7,744.2663.95
Profit (Loss) per Share0.01-0.2-
All figures are in (Millions) Saudi Arabia, Riyals

Element ListExplanation
The reason of the increase (decrease) in the net profit during the current quarter compared to the same quarter of the last year isThe reason for the achieving net profit of SR 11.93 million in the current quarter compared to the net loss of SR 182.46 million in the same quarter of last year is mainly attributed to following:
- The company's revenue increased by 189% compared to the same quarter of last year as a result of the strong improvement in hotel occupancy and average room rates

- The reversal of expected credit loss allowance of amount SR 28 million due to improvement in collection of receivables

- Decrease in financial charges expense by 18% because of additional capitalization of finance cost in current quarter, which was being expensed in the same quarter of the last year due to partial suspension of development activities.
The reason of the increase (decrease) in the net profit during the current quarter compared to the previous quarter of the current year isThe reason for the achieving net profit of SR 11.93 million in the current quarter compared to the net loss of SR 197.61 million in the previous quarter is mainly attributed to following:
- The company's revenue increased by 32% compared to the previous quarter as a result of the improvement in hotel occupancy and average room rates. in addition, first nine days of Ramadan being coinciding with current quarter.
Statement of the type of external auditor's reportQualified conclusion
Modification, Qualification or Emphasis of a Matter as Stated within the External Auditor OpinionAs of 31 March 2023, the Group’s total assets include Property, Plant and Equipment and Investment Properties (collectively referred to as the ‘Properties’) amounting to SR 19,973 million and SR 5,063 million respectively (31 December 2022: SR 19,502 million and SR 5,048 million respectively).
As disclosed in Note 5, due to the presence of impairment indicators identified in current and previous financial periods, management has performed an impairment exercise in those respective periods. Pursuant to managements’ impairment assessment carried out during the three months period ended 31 March 2023 which included a retrospective review of recoverable amount of the Properties in prior periods, management has identified that certain properties require an impairment adjustment of SR 0.7 billion as at 1 January 2022. Accordingly, management has recognized such adjustment by restating the corresponding balances of Property, Plant and Equipment and Accumulated Losses as of that date. The effect of the restatement is disclosed in note 20. In management’s view, the estimates of recoverable amount used in carrying out the foregoing impairment assessment and the resulting restatement are based on assumptions and judgments existing as of the date of such restatement i.e., 1 January 2022. However, due to the elapse of time and significant changes in market conditions since the date of restatement, we are unable to conclude whether those assumptions and judgments are reasonable as at 1 January 2022 and unaffected by the events, circumstances and information arising subsequent to the restatement date and therefore do not incorporate any hindsight. Accordingly, we were unable to conclude whether any adjustment is required to the reported amounts of the Properties and Accumulated Losses as of 1 January 2022 as well as to the amount of expenses reported in the statement of profit or loss and other comprehensive income for the comparative three-month period ended 31 March 2022. Our conclusion on these condensed consolidated interim financial statements is modified because of the possible effect of this matter on the comparability of the current period’s figures and the corresponding figures.

Based on our review, except for the possible effects on the corresponding figures for the three month period ended 31 March 2022 of the matter described in the basis for qualified conclusion section of our report, nothing has come to our attention that causes us to believe that the accompanying condensed consolidated interim financial statements of Jabal Omar Development Company and its subsidiaries are not prepared, in all material respects, in accordance with IAS 34, ‘Interim Financial Reporting’ as endorsed in the Kingdom of Saudi Arabia.

We draw attention to Note 2.4 of the condensed consolidated interim financial statements, which indicates that the as at three-month period ended 31 March 2023 the Group's current liabilities exceed its current assets by SR 1,053 million. As stated in Note 2.4, these events and conditions, along with other matters set forth therein, indicate that a material uncertainty exists that may cast significant doubt on the Group's ability to continue as a going concern. Our conclusion is not modified in respect of this matter.
Reclassification of Comparison ItemsDuring the period, the Group restated certain amounts and balances included in the prior year financial statements in order to reflect appropriate accounting and classification to ensure compliance with IFRS.
Additional Information Not applicable
All figures are in (Millions) Saudi Arabia, Riyals

Other Disclosures

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