Makkah Construction and Development (4100) Q1 2026 earnings summary

Executive summary

• Achieved solid Q1 2026 performance with revenue up 7% year-over-year to SAR 251 million and net profit up 8% to SAR 162 million, driven by strong mall and hotel operations and disciplined execution.

• Completed a major strategic milestone with the Ajyad land acquisition for SAR 980 million to SAR 979 million, supporting long-term expansion and future mixed-use development.

• Launched a SAR 400 million renovation program for Hotel and Towers, with phased execution to enhance product quality and guest experience through 2028.

• Retail segment led growth, with mall revenues up 20% year-over-year to SAR 79 million and gross profit up 26% to SAR 65 million, reflecting successful tenant mix optimization.

• Hospitality segment maintained strong results despite geopolitical challenges, with RevPAR up 4.5%–5% to SAR 1,157, supported by improved pricing and ongoing asset enhancement plans.

Financial highlights

• Revenue increased by 7% year-over-year to SAR 251 million, driven by steady Hotel and Towers performance and 20% growth from MCDC Mall.

• Net income rose by 8% to SAR 162 million, with MCDC Mall contributing SAR 13 million of the increase.

• Gross profit grew by 10% to SAR 187 million; EBITDA up 7% to SAR 174 million.

• Earnings per share improved to SAR 0.81 from SAR 0.75 year-over-year.

• Free cash flow declined to negative SAR 852 million, mainly due to the Ajyad land acquisition.

Outlook and guidance

• 2026 guidance maintained: Hotel and Towers RevPAR expected to grow in line with recent trends and seasonal patterns.

• MCDC Mall guidance stable: available area ~17,700 sq m, leasable area ~17,650 sq m, average lease rate ~SAR 17,700/sq m.

• MCDC Hajj 2026 capacity expected at 60,000–70,000 pilgrims with a gross margin of 5%-6%.

• Enhancement program for Hotel & Towers to be implemented in stages during low season, aiming to improve asset quality and positioning while maintaining service continuity.

• Ajyad land project design phase underway, with completion targeted by end of 2026 and operations expected to begin in 2030.