Marka, the Dubai-listed retail operator, on Tuesday said its plans to continue “extensive cost-cutting” and rejig its portfolio after posting a second annual loss and missing its target to be in the black after two and a half years of trading.
“Marka’s board of directors have decided to continue with the extensive cost-cutting programme it applied throughout 2016 and remain optimistic that with the current strategy of focusing on home-grown brands, along with restructuring of the existing portfolio, Marka should be able to show continued revenue growth and achieve profitability by the end of this year,” the retailer said.
Marka said 2016 full-year net loss widened to Dh88.2 million from a net loss of Dh56.9m in 2015. The retailer did not provider fourth-quarter figures.
Total revenues for 2016 came to Dh291.2m, an increase of over 35.5 per cent from Dh214.8m in 2015. Khaled Al Mheiri, the vice chairman and interim chief executive of Marka, was unavailable for comment. Mr Al Mheiri assumed his interim role after Marka in December announced the resignation of Nick Peel as the chief executive,
Marka launched in September 2014 at the height of the luxury retail boom focusing on the sports, hospitality and fashion segments of the retail sector and high-quality casual dining outlets in retail centres. The company has expanded aggressively in food and beverage (F&B) and launched its own fashion line on Sunday in the face of a retail and F&B slowdown.
The retail market in the UAE has been hard-hit by the strong US dollar, to which the dirham is pegged, making it an expensive destination for tourists from regions such as Europe, while a slower economy is also having an effect on purchasing power.
“Although we incurred losses in the past year, we also took strategic steps to re-evaluate all our operating divisions and our portfolio of brands. We will continue to focus on replacing elements of our business that may be underperforming said Mr Al Mheiri.” Marka’s shares closed up 2 per cent to Dh1.47 in Dubai on Tuesday.
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ascott@thenational.ae
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