Contents - Majid Al Futtaim

Transcription

GREAT MOMENTS
FOR EVERYONE,
EVERYDAY
Contents
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CEO reflects
Our Story
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17
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Our pioneering spirit
07
Our groundbreaking businesses
09
2014, an outstanding year
12
Momentous milestones
13
Strategic growth
15
Our Commitment
People-centric
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Committed to sustainability
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Socially responsible
23
Our Corporate Governance
Sound corporate governance
27
Our board
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Our Financial Performance
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43
A financial review of 2014
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Financial performance overview
36
Business unit performance
37
Group debt profile
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Key credit strengths
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Our Future
Leading the way forward
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2014
HOLDING | ANNUAL REPORT
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CEO reflects
Our Story
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09
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Strategic growth
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Our Commitment
People-centric
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WE LIVE OUR VISION TO
‘CREATE GREAT MOMENTS
FOR EVERYONE, EVERYDAY’
BY PIONEERING NEW
DESTINATIONS AND NEW
EXPERIENCES
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Our board
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Group debt profile
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41
Our Future
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Holding Annual Report 2014 - Our Past, Present and Future
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Contents
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CEO reflects
Our Story
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17
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09
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Strategic growth
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Our Commitment
People-centric
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Our board
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Group debt profile
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Our Future
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Contents
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CEO reflects
Our Story
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Our CEO reflects
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09
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Strategic growth
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Alain Bejjani, Chief Executive Officer of
Majid Al Futtaim Holding looks back on
a remarkable 2014, and anticipates
a future of more epic achievements.
Our Commitment
People-centric
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It’s been a year since our transformational
rebrand, and a year of which we can all
be proud.
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Our board
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The company’s financial strength and
operational expansion in our home market
of the UAE, as well as across the wider
Middle East and North Africa, has delivered
robust financial performance across all
areas of the business.
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Group debt profile
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Revenue growth continued to remain stable
at 11% year-on-year to AED 25 billion, while
EBITDA increased 10% to AED 3.6 billion,
as we strive to achieve our ambition of
doubling the size of the business in the next
five years.
Majid Al Futtaim Retail continued to offer
convenience to customers by opening
19 new Carrefour stores in 2014. This
expansion created around 1,700 jobs and
took our presence to 58 hypermarkets and
over 65 supermarkets in 12 countries.
Majid Al Futtaim Properties experienced
new growth as we witnessed the launch of
the ‘My City Centre’ brand of neighbourhood
shopping centres with the opening of
My City Centre Nasseriya in Sharjah. In
addition, the past year also saw us complete
the new Fashion District at our iconic Mall
of the Emirates, and commence the mall’s
25,000 square metre expansion. We are also
looking forward to opening Mall of Egypt
in Cairo, which continues on schedule with its
completion targeted for 2016.
It was also a year of firsts for Majid Al Futtaim
Ventures. Not only did we successfully open three
new VOX Cinemas in Oman and Abu Dhabi, adding
37 new screens to the region; we also opened the
first Abercrombie & Fitch, Hollister and LEGO®
certified stores in the Middle East, and acquired
Beam, an innovative mobile commerce and rewards
platform that turns smartphones into digital
wallets.
In May 2014, we issued our first ten-year USD
$500 million bond, extending the average life of
the company’s debt portfolio. This was the first
ten-year issuance out of Dubai since 2010, and
the longest tenure achieved by a Dubai corporate
issuer. In addition to that, the year also saw us
receive the ‘Most Innovative Treasury’ award from
Global Capital.
Overall, 2014 represented a year where we
strengthened our assets and competitive position
by continuing to execute on our vision to ‘create
great moments for everyone, everyday’, developing
exciting new destinations, and bringing new
experiences to people in new markets.
We are at the beginning of a new journey, and I look
forward to our bright future.
Our Future
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03
Holding Annual Report 2014 - Our CEO reflects
Holding Annual Report 2014 - Our CEO reflects
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Contents
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CEO reflects
Our story
Our Story
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Strategic growth
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The story of Majid Al Futtaim
is one of extraordinary growth
and groundbreaking ideas.
Our Commitment
People-centric
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Our board
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Group debt profile
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Our Future
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The companies that succeed are the ones that continue to innovate, that have a passion for
growth, and that boldly lead the way forward.
CEO reflects
At Majid Al Futtaim we have
always dared to follow our dreams
and forge new paths.
Our Story
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Strategic growth
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Our Commitment
People-centric
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Our board
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When we opened our very first
mall, City Centre Deira, in 1995
we created a new definition
and standard of shopping and
leisure in the region. Twenty
years later we’re still pioneering
the way forward with innovative
destinations and one-of-akind experiences.
Today our business spans 12
international markets, employs
over 27,000 people, and has
achieved the highest credit rating
(BBB) among privately held
corporates in the Middle East.
We own and operate 17 shopping
malls, 11 hotels and three mixeduse communities in MENA. Our
unique shopping malls portfolio
includes the popular “City Centre”
franchise, the iconic Mall of
the Emirates, as well as the
“My City Centre” brand in our
neighbourhood mall category.
In the retail sector, we hold the
exclusive rights to the renowned
Carrefour franchise in 38 markets
across Middle East, Africa and
Central Asia.
Our unmatched leisure facilities
include 129 VOX Cinemas, 17
Magic Planet family entertainment
centres, as well as unforgettable
experiences that no one has
ever seen before - like the thrill
of real snow with our iconic
indoor ski slope at Ski Dubai, or
an exhilarating indoor skydiving
experience at iFly Dubai.
We also represent internationally
renowned fashion brands such
as Abercrombie & Fitch, Juicy
Couture and Halston Heritage,
and have launched the first ever
LEGO® certified stores in the
Middle East.
sector through our City Centre
Clinic, the food and beverage
industry with Gourmet Gulf, the
finance sector with Najm credit
cards and Beam digital wallets,
and we also have a joint venture
with Dalkia in the energy and
facilities management sector.
The future belongs to those
companies that have the vision
and courage to be the first to step
up and unlock its potential. At
Majid Al Futtaim our pioneering
spirit continuously drives us
forward. And to maintain our
competitive positioning and
leading edge we remain dedicated
to innovating the customer
experience, and providing ‘great
moments for everyone, everyday’.
Always looking out for strategic
diversification opportunities
complimenting our value
proposition, our business portfolio
has expanded into the healthcare
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Group debt profile
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Our Future
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Holding Annual Report 2014 - Our Story
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Our diverse portfolio of businesses and brands speak to our entrepreneurial spirit and strong
ambition to continually grow.
CEO reflects
Our Story
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Strategic growth
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Food and
Beverage
Financial
Services
Our Commitment
People-centric
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Mixed-use
Communities
Cinema
Hypermarkets and
Supermarkets
Leisure and Entertainment
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Our board
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Group debt profile
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Shopping Malls
Fashion
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Our Future
Healthcare
Hotels
Energy and
Facilities
Management
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09
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Majid Al Futtaim enjoyed another year of growth, expansion and exciting new ventures that firmly reinforces our
reputation as the leading shopping mall, retail and leisure pioneer across the Middle East and North Africa (MENA).
CEO reflects
Exceptionally Strong
Performance
Our Story
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Strategic growth
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Our Commitment
People-centric
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Our board
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Group debt profile
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At the Hotels business unit
revenue per available room
(RevPar) at its 11 hotels grew
4% during the year (11% on a
like for like basis) with average
occupancy rates of 73% for the
year. During 2014 it opened the
newly renovated Pullman City
Centre Residences at City Centre
Deira; and Hilton Garden Inn, the
company’s 10th hotel in Dubai, is
expected to open in 2016.
Proven Track Record
New Shopping Concept
We have sustained our investment
grade rating of BBB with both
Standard & Poor’s and Fitch. In
addition we have strengthened our
balance sheet with assets over
AED 45 billion, and issued our first
10 year USD 500 million bond.
2014 saw the launch of a new
shopping mall brand for
Majid Al Futtaim Properties,
My City Centre. Incorporating
the same design and service
excellence of the City Centre
brand, My City Centre Nasseriya in
Sharjah serves the everyday needs
of the community, and marks the
first of our neighbourhood malls.
In the Majid Al Futtaim Properties
business unit as a whole, revenue
increased by 8% to AED 4 billion
and EBITDA rose by 7% to AED 2.4
billion, contributing around 66% of
the Group’s overall EBITDA.
As the largest hypermarket
master franchisee in MENA,
Majid Al Futtaim Retail opened
19 new Carrefour stores across
the region in 2014, creating about
1,700 jobs and taking the Group’s
presence to 58 hypermarkets and
over 65 supermarkets. Revenue
in the Majid Al Futtaim Retail
business unit increased by 11%
to AED 21 billion and EBITDA
rose by 16% to AED 1.1 billion,
contributing around 32% of the
Group’s EBITDA.
Our Future
Majid Al Futtaim’s financial
strength and operational
expansion in the UAE, as well as
across the wider Middle East and
North Africa, has delivered strong
financial performance across all
areas of the business. Revenue
growth continued to remain stable
at 11% year-on-year to AED 25
billion, while EBITDA increased by
10% to AED 3.6 billion.
Rapidly Expanding Franchise
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Growing More Destinations
World-class Offerings
Our premier shopping resort, Mall
of the Emirates launched its new
Fashion District. This new themed
destination is part of Evolution
2015 - an ambitious, multi-stage
redevelopment project that will
reveal a series of exciting new
shopping, entertainment and
dining concepts. The construction
of our second ‘Mall of’ project,
Mall of Egypt, is on schedule with
its completion target for Q2 2016.
Exciting New Experiences
The Majid Al Futtaim Ventures
business unit enjoyed a remarkable
20% year-on-year growth in
revenues, and this strong increase
can be attributed to higher
performance from all its entities.
This included Majid Al Futtaim
Cinemas opening three new
VOX Cinemas in Oman and Abu
Dhabi, adding 37 new screens to
the region; as well as the launch of
five new food & beverage outlets,
six new fashion brands, and the
opening of the first Abercrombie &
Fitch, Hollister and LEGO® certified
stores in the Middle East.
Innovative New Technology
Majid Al Futtaim Ventures recently
entered into a joint venture with
Beam, a mobile commerce and
rewards platform that turns
smartphones into digital wallets.
Beam utilises Bluetooth Low
Energy (BLE) Beacon technology,
a first in the region; and is already
in operation in over 1,200 outlets
across the UAE.
A successful year of growth and
achievement, 2014 was a clear
step forward as we strive to
achieve our ambition of doubling
the size of the business in the next
five years.
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In 1995 our journey began with the establishment of City Centre Deira in Dubai - one of the first
landmark shopping malls to pioneer the retail landscape for the region. Now 20 years later,
we are still innovating the way forward.
CEO reflects
Our Story
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09
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Strategic growth
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Our Commitment
People-centric
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Cinestar
Sofitel
Carrefour
City Centre
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Our board
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1995
1998
Dubai
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ORIX*
Dalkia
Magic Planet
Cinestar
Sofitel
Carrefour
City Centre
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Dalkia
Magic Planet
Cinestar
Sofitel
Carrefour
City Centre
Fashion
ORIX*
Dalkia
Magic Planet
Cinestar
Sofitel
Carrefour
City Centre
Najm Credit Card
City Centre Qurum
Ibis/Novotel Dubai
City Centre Bahrain
Mall of the Emirates
Ski Dubai
Kempinski Dubai
The Wave Muscat
Fashion
ORIX*
Dalkia
Magic Planet
Cinestar
Sofitel
Carrefour
City Centre
City Centre Fujairah
Sheraton Hotel (MOE)
Playnation (Mirdif)
City Centre Mirdif
Wahooo! Water Park
Najm Credit Card
City Centre Qurum
Ibis/Novotel Dubai
City Centre Bahrain
Ski Dubai
Kempinski Dubai
The Wave Muscat
Fashion
ORIX*
Dalkia
Magic Planet
VOX (Cinestar)
Pullman (Sofitel)
Carrefour
City Centre
My City Centre Nasseriya
City Centre Clinic
Kempinski Bahrain
Gourmet Gulf
Waterfront City
City Centre Beirut
City Centre Fujairah
Sheraton Hotel (MOE)
Playnation (Mirdif)
City Centre Mirdif
Wahooo! Water Park
Najm Credit Card
City Centre Qurum
Ibis/Novotel Dubai
City Centre Bahrain
Ski Dubai
Kempinski Dubai
The Wave Muscat
Fashion
ORIX*
Dalkia
Magic Planet
VOX (Cinestar)
Pullman (Sofitel)
Carrefour
City Centre
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Group debt profile
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Our Future
1999
2001
Dubai
Rest of UAE
Oman
2001
2003
UAE
Oman
Egypt
2003
2005
UAE
Oman
Egypt
Saudi Arabia
2005
2009
UAE
Oman
Egypt
Saudi Arabia
Kuwait
Bahrain
Jordan
Qatar
2009
2012
UAE
Oman
Egypt
Saudi Arabia
Kuwait
Bahrain
Jordan
Qatar
Pakistan
Iraq
2012
2014
UAE
Oman
Egypt
Saudi Arabia
Kuwait
Bahrain
Jordan
Qatar
Pakistan
Iraq
Lebanon
Georgia
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“Sold in 2013
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Contents
Strategic growth
Georgia
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CEO reflects
Our Story
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07
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Strategic growth
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Lebanon
Iraq
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Our Commitment
People-centric
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Jordan
Pakistan
Kuwait
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Our board
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Qatar
Saudi
Arabia
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Bahrain
Egypt
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Group debt profile
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UAE
Oman
Our Future
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CEO reflects
Our Story
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Strategic growth
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Our Commitment
People-centric
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Our board
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Group debt profile
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Our Future
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Our
commitment
At the heart of everything we
do is our dedication to our
people, our communities and
our world.
Contents
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Our people make everything that we do possible, and we aim to be a company
that employees want to be a part of.
Sustainability is at the core of our business strategy, and allows us to not only focus on profitability but also on
making a difference in the countries and communities where we operate.
CEO reflects
Our Story
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People-centric
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Strategic growth
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Our Commitment
People-centric
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At Majid Al Futtaim we currently
employ over 27,000 people, all
dedicated to making our vision
to ‘create great moments for
everyone, everyday’ a reality. Our
management teams and people
on the ground come from over
84 different countries and bring
decades of experience, across a
diverse range of industries.
As a company we strive to instill
values and a culture that cultivates
entrepreneurial spirit, innovation,
customer service, ethical business
practices, team work and
community involvement.
We strongly believe that our
greatest and most valuable asset is
our people. And so we encourage
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people to think in a different
way, with a vision that embraces
innovation, creating the challenge
and the inspiration to push people
to stretch further and excel at what
they do.
With an international presence
across 13 markets, we provide
opportunities for employees to
work in other countries. And the
range of opportunities we present
is vast, from engineering and
project management to marketing,
customer service and other
professional fields.
Dedicated to supporting our
employees’ development,
we provide a range of worldclass training and leadership
development programmes to
help employees achieve ongoing
career success.
These programmes include our
comprehensive Management
Trainee Programme, as well as
our Internship Programmes,
where we work with recognised
universities and educational
institutes to offer greater expertise
and hands-on learning for valuable
work experience.
People are at the heart of
everything we do, and so we
continuously strive to provide
a stimulating and empowering
environment that retains and
attracts outstanding talent with the
right passion and expertise.
In 2014 we conducted a sustainability materiality and risk review across our entire group of companies. This
review sought to identify and provide details on our key sustainability risks and impact areas. The goal is that
this process would allow us to develop an overarching policy, reporting framework and governance structure
for sustainability for Majid Al Futtaim Holding and its subsidiary companies.
To date the focus of our sustainability efforts has been on our Properties division, where our largest
sustainability impacts are made. Further details of our Majid Al Futtaim Properties sustainability work can be
found below.
At Majid Al Futtaim Properties our sustainability mission is to enhance people’s lives through sustainable real
estate. We want to lead by example by applying international best practices across our properties, and in so
doing, we hope to transform the economic and social development of the region.
In 2014 we began to implement Majid Al Futtaim Properties’ ambitious new five-year sustainability strategy.
The strategy, which aims to embed sustainability through the business, is driven by our Sustainability Steering
Group and our Board and focuses on three key areas: pioneering standards, high performance assets, and
prosperous communities.
Majid Al Futtaim Properties,
Sustainability Strategy
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PROSPEROUS COMMUNITIES
Our board
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• COMMUNITY WELL-BEING & ENGAGEMENT
• LOCAL ECONOMIC DEVELOPMENT
• EMPLOYEES
• ENHANCEMENT OF THE PUBLIC REALM
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Group debt profile
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SUSTAINABILITY
MISSION
ENHANCING PEOPLE’S
LIVES THROUGH
SUSTAINABLE REAL
ESTATE
PIONEERING STANDARDS
• LABOUR CONDITIONS IN THE SUPPLY CHAIN
• HEALTH & SAFETY
• GREEN BUILDING STANDARDS
• SUSTAINABLE PROCUREMENT
HIGH PERFORMANCE ASSETS
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• WATER
Our Future
• ENERGY & CARBON
• WASTE
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• TENANTS & OPERATORS
• CUSTOMERS & VISITORS
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Holding Annual Report 2014 - Our commitment
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Other significant 2014 achievements include the launch of a Labour Policy that safeguards worker rights
across our developments. This puts us in a strong place to influence regional best practice on the treatment
of workers. We also increased Majid Al Futtaim Properties’ green building certifications to seven assets and
13 green star ratings for tenant fit outs, appointed a Green Star Rating Manager, raised our minimum green
building standard for all new developments to LEED Gold or equivalent, and built sustainability capacity
outside the UAE through employee training.
CEO reflects
Our Story
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By the end of last year 73% of Majid Al Futtaim Properties’ sustainability targets with a 2014 deadline
were achieved, with 23% partially achieved. In particular, Majid Al Futtaim Properties improved on its 2013
performance against the Global Real Estate Sustainability Benchmark, and was awarded Green Star status,
thus cementing our leadership position in the region.
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Strategic growth
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Sustainability is at the foundation of our business objectives. It supports long-term value creation, enhances
our brand and, most importantly, gives us license to operate as an organisation that focuses not only on
profitability, but on making a positive impact on the lives of those whom we serve.
73%
OUR 2014
HIGHLIGHTS
OF TARGETS
ACHIEVED
Pioneering
Standards
Prosperous
Communities
High Performance
Assets
0 fatalities
2,561 hours of
volunteering
13 green star ratings
for tenant fit outs
115 health & safety audits
52 labour accommodation audits
AED 17.9 million
pr value created from
community investment
Increased environmental
data coverage by adding
4 operational assets
2 construction sites
1 labour policy
created
66 interships & 24 job
shadowing placements
69% recycling rate
at our head office
Accident frequency rate
1.06 Uae & Oman
3.2 other markets
AED 7.3 million
community
investment
15.8% like-forlike water use reduction
in malls since 2013
7 assets have green
building certifications
181 staff received
sustainability training
4.7% energy reduction
hotels since 2013
Our Commitment
People-centric
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Our board
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Group debt profile
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Our Future
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As one of the leading companies in the region, we know that it is our responsibility to also contribute to
the upliftment and empowerment of the communities we operate in.
CEO reflects
Our Story
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Strategic growth
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Our Commitment
People-centric
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Our board
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The Majid Al Futtaim Charity
Foundation was established in 2006
to help improve the quality of life for
communities in the UAE and across
the Middle East. It seeks to play
an active role in creating a better
future by providing healthcare
and education assistance to
underprivileged and marginalised
sectors in the UAE, and also
works with local and international
charities to reach those in need.
Outside of our healthcare and
education initiatives, sponsoring
charitable events and supporting
Ramadan activities and other
community initiatives constitute
another important area of operation
for us. This provides us with an
opportunity to play an active role in
community development as well as
establish meaningful partnerships
with other organisations that will
have a far-reaching impact on the
development of the UAE.
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In 2014 the Foundation achieved
the following:
Completion of Neonatal
Extension at Latifa Hospital in
Dubai
In February 2013, the Foundation
partnered with Dubai Health
Authority to provide an 18-bed
state-of-the-art neonatal intensive
care unit at Latifa Hospital at an
estimated cost of AED 24,5 million.
The project is now fully operational
with an official opening ceremony
being planned.
The SMART (Start Making
All the Right Turns) Campaign
SMART educates children aged
13 to 18 years on healthy living
within a sports and entertainment
platform. It covers smoking,
physical activity, diet and nutrition,
obesity prevention, diabetes,
hypertension and high cholesterol.
This successful campaign started
in 2012, targeting mainly private
educational institutions, which are
under the control of the Knowledge
and Human Development Authority
(KHDA). In 2014, a total of 16,903
students in approximately 47
schools were introduced to the
SMART program.
Fujairah Al Masjid
In 2013 the Foundation completed
the Al Bidiya Housing Complex,
which provided 30 villas to UAE
citizens in need. In June of 2014,
the Fujairah Al Masjid at Al Bidiya
was completed, along with road
works for the housing complex, at a
cost of AED 1.2 million. The masjid
became fully operational after an
inauguration by the Crown Prince of
Fujairah, H.H. Sheikh Mohammed
bin Hamad bin Mohammed Al
Sharqi.
Ramadan and Zakat Activities
The Foundation’s board members
approved AED 7 million on the
14th of May 2014 as a Ramadan
charity contribution. The funds were
distributed to a number of worthy
beneficiaries throughout the UAE.
Our Future
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Holding Annual Report 2014 -- Our
Ourcommitment
commitment
Holding
HoldingAnnual
AnnualReport
Report2014
2014 - Our commitment
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CEO reflects
Our
corporate
governance
Our Story
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Strategic growth
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Our Commitment
People-centric
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We actively encourage the
ethos of good governance,
accountability and best practice.
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Our board
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Our Future
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At Majid Al Futtaim, sound corporate governance is our commitment to maintain accountability in our
professional conduct and to the stakeholders we engage with.
CEO reflects
The strong potential for growth in the 1990s precipitated the decision to embed sound corporate governance
across the business.
Our Story
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This involved the separation of ownership and management, bringing in a strong management team supported by
majority independent Boards, and the voluntary adoption of the UK’s Combined Code on Corporate Governance.
We believe that effective governance is realised thorough leadership and partnership and that the role and actions
of the Boards should complement, enhance and support the work of the management team, while protecting and
growing the shareholders’ interest.
Our business, property and affairs are overseen under the direction of the Majid Al Futtaim Holding Board, which
provides independent oversight of the wholly owned Boards as well as the subsidiary operating companies’
management performance and holds the Board and management accountable to the shareholder.
Our Commitment
People-centric
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Our board
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Majid Al Futtaim Properties, Retail and Ventures all have their own autonomous Boards, with a majority of
independent directors. These Boards are responsible for setting the strategic goals for each business. In this
way they measure the success of their business objectives and are accountable for delivering sustainable
improved performance. Each Board has a separate Audit and Risk Committee as well as a HR and
Remuneration Committee.
Every business is held accountable for reviewing and improving business performance, and the Boards are no
exception. Self and independent evaluations assess the Boards’ and Committees’ processes and effectiveness, skill
sets, and the relationships between the independent directors and management.
Sound governance has become a brand feature at Majid Al Futtaim, which enables us to attract highly experienced
Board Members, as well as the best and brightest regional and international management talent.
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Our Future
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Ourcorporate
corporategovernance
governance
Holding
HoldingAnnual
AnnualReport
Report2014
2014 - Our corporate governance
28
Contents
03
Our Board
Our business, property and affairs are overseen under the direction of the Majid Al Futtaim
Holding Board, which provides independent oversight to protect our shareholders’ interests.
CEO reflects
Our Story
05
17
07
09
12
13
Strategic growth
15
Sir Michael Rake
Chairman
43
Appointed in 2012
Mr Viswanathan Shankar joined the Board on 1 January 2012. Shankar was until recently (April 2005)
Group Executive Director and a member of the Board of Directors of Standard Chartered PLC and
Standard Chartered Chief Executive Officer - Europe, Middle East, Africa and the Americas as well as
Executive Chairman of Principal Finance and Chairman of Standard Chartered private bank.
Khalifa Sulaiman
Ian Davis
Our Commitment
People-centric
19
20
23
27
Our board
29
31
Viswanathan Shankar
Sir Michael Rake is currently the Chairman of BT Group plc, the UK’s largest telecom operator, President
of the Confederation of British Industry, and he holds directorships at Barclays PLC and McGraw Hill Inc.
amongst others. His previous illustrious appointments include Chairman of KPMG International, Senior
Partner at KPMG UK, and Chairman of KPMG Europe.
Deputy Chairman
25
Appointed in 2009
33
36
37
Group debt profile
39
41
Appointed in 2011
Appointed in 2012
A prominent UAE national, Mr Khalifa Sulaiman has enjoyed a seasoned profession in government,
representing his country at the highest levels locally, regionally and internationally. In his career he has
been Ambassador to the Court of St James in the UK, Chairman of H.H. The Ruler’s Court, Dubai, and
Director and Chairman of the National Bank of Dubai PJSC.
Mr Ian Davis is the Chairman of Rolls Royce, as well as an independent non-executive director at BP and
Johnson & Johnson, and a non-executive member of the Cabinet of the United Kingdom. His career also
includes being appointed Chairman, Worldwide Managing Director and Senior Partner at McKinsey &
Company where he worked across the private, public and not-for-profit sectors.
Tariq Al Futtaim
Alain Bejjani
Appointed in 2005
Mr Tariq Al Futtaim has been involved in the Majid Al Futtaim business as Vice President since the group
was first formed. He is currently the Chairman of the Majid Al Futtaim Charity Foundation, an esteemed
charitable initiative well known for its work in the healthcare and education sectors.
Chief Executive Officer
Appointed in 2015
Mr Alain Bejjani has built a distinguished career at Majid Al Futtaim. He was formerly the Chief
Corporate Development and Brand Officer at Majid Al Futtaim Holding, and Vice President (Legal) and
Head of Business Development at Majid Al Futtaim Properties. Prior to that, he was Executive Vice-Chairman
of the Investment Development Authority of Lebanon (IDAL) and a founding partner of a law firm.
Our Future
45
29
Ourcorporate
corporategovernance
governance
Holding
HoldingAnnual
AnnualReport
Report2014
2014 - Our corporate governance
30
Contents
03
CEO reflects
Our financial
performance
Our Story
05
17
25
07
09
12
13
Strategic growth
15
Our financial strength and
operational expansion across the
region has delivered exceptional
financial performance across all
areas of our business.
Our Commitment
People-centric
19
20
23
27
Our board
29
31
43
33
36
37
Group debt profile
39
41
Our Future
45
31
Holding Annual Report 2014 - Our financial performance
32
Contents
03
Our financial strength and operational expansion in the UAE, as well as across the wider MENA region, has
resulted in strong and steady financial performance across all areas of our business.
CEO reflects
As per our transparent disclosure policies, our full consolidated financial statements for 2014, and going back
historically, can be found on our website www.majidalfuttaim.com.
In this section we provide a clear, user-friendly overview of the financial developments and highlights for 2014,
together with the key top-line figures and matrices. All financials presented here are IFRS-based.
Our Story
05
17
07
09
12
13
Strategic growth
15
Majid Al Futtaim Group Financial Snapshot
Our Commitment
People-centric
19
20
23
(AED mn)
2010
2011
2012
2013
2014
CAG R
Assets
33,954
35,470
37,920
39,454
44,624
7.1%
Revenues
16,778
18,403
20,579
22,696
25,224
10.7%
EBITDA
2,279
2,736
2,969
3,275
3,586
12.0%
2014 Financial Highlights
25
27
Our board
29
31
43
33
36
37
Group debt profile
39
41
Our operational and financial results for the year ended 31st December 2014 confirm another steady year of
growth, with total revenues growing by 11% to AED 25 billion. While EBITDA from recurring operations grew by 10%
year-on-year to reach AED 3.6 billion.
The company continued to maintain a strong balance sheet with total assets valued at more than AED 45 billion
and a net debt of around AED 8 billion. And both Fitch Ratings and Standard & Poor’s reaffirmed our investmentgrade rating of BBB, with a stable outlook during the year.
2014 saw us issue our first 10 year USD 500 million bond, extending the average life of the company’s debt
portfolio. This was the first 10 year issuance out of Dubai since 2010, and the longest tenure achieved by a Dubai
corporate issuer.
In addition to this, we further optimised our debt portfolio on the back of our solid financial performance and strong
liquidity conditions in the banking market. Our liquidity position continues to be robust, with more than two years of
gross financing needs covered through our cash and available committed lines.
Another great financial highlight of 2014, was receiving the prestigious “Most Innovative Treasury” award from
Global Capital.
Our Future
45
33
Ourfinancial
Past, Present
performance
and Future
Holding
Holding
Annual
Annual
Report
Report
2014
2014
- Our
- Our
Past,
financial
Present
performance
and Future
34
Contents
03
We have a proven track record of delivering strong financial results on the back of an effective
growth strategy.
CEO reflects
Overview of Past Financial Performance
Our Story
17
07
09
12
13
Strategic growth
15
19
20
23
2011
2012
2013
2014
CAG R
Assets
33,954
35,470
37,920
39,454
44,624
7.1%
Revenues
16,778
18,403
20,579
22,696
25,224
10.7%
EBITDA
2,279
2,736
2,969
3,275
3,586
12.0%
18.5
16.9
15.1
13.9
CAGR:13%
2.3
2.8
3.1
3.5
CAGR:9%
3.8
0.8
PROPERTIES
CAGR:13%
2011
0.9
0.8
0.7
2012
2013
2014
2.4
2.2
27
Our board
29
EBITDA
(AED mn)
2.0
1.7
1.5
CAGR:11%
0.9
0.8
1.1
1.0
0.9
CAGR:9%
0.1
43
33
36
37
Group debt profile
39
41
PROPERTIES
70.0%
Our Future
RETAIL
2010
Overview of
EBITDA Margin
31
1.1
VENTURES**
RETAIL
2010
25
20.6
CAGR:10%
Our Commitment
People-centric
2010
Revenue
(AED mn)
05
(AED mn)
0.1
0.2
VENTURES**
2012
2013
63.4%
61.9%
0.1
2014
62.0%
62.6%
62.0%
14.2%
14.2%
60.0%
50.0%
40.0%
30.0%
18.6%
20.0%
12.6%
10.0%
5.4%
0.0
45
2011
0.1
17.5%
5.9%
2010
5.3%
5.5%
2011
2012
MAFP
MAFR
2013
5.6%
2014
MAFV**
FULL YEAR 2014 FIGURES BASED ON FULL YEAR 2014 AUDITED ACCOUNTS
** MAF VENTURES 2013 NUMBERS RESTATED AS A RESULT OF ORIX DIVESTITURE
35
Ourfinancial
Past, Present
performance
and Future
Holding
Holding
Annual
Annual
Report
Report
2014
2014
- Our
- Our
Past,
financial
Present
performance
and Future
36
Contents
An overview of strong growth within our three business units.
03
CEO reflects
Majid Al Futtaim Properties
Properties increased footfall during the past year at its 13 consolidated shopping malls by 6% to 167 million
consumers. Revenue increased by 8% to AED 4 billion and EBITDA rose by 7% to AED 2.4 billion, contributing
around 66% of the group’s overall EBITDA.
Our Story
05
Revenue per available room (RevPar) at the company’s 11 hotels grew 4% during the year (11% on a like-for-like
basis) with average occupancy rates of 73% for the year.
07
09
Majid Al Futtaim Retail
12
13
Strategic growth
15
The opening of 19 new Carrefour stores created around 1,700 jobs in 2014. Revenue increased by 11% to AED 21
billion and EBITDA rose by 17% to AED 1.1 billion, contributing around 32% of the group’s EBITDA.
Majid Al Futtaim Ventures
19
20
23
27
Our board
29
43
33
36
37
Group debt profile
39
41
Our Future
45
(AED mn)
2013
2014
Change
Revenues
22,696
25,224
11%
EBITDA
3,275
3,586
10%
Business Units Revenue and EBITDA
Properties
31
Group Revenue and EBITDA
Retail
25
People-centric
Ventures
17
In 2014, Ventures achieved strong operational growth with revenue increasing by 20% to AED 1 billion and EBITDA
for the year increasing by 20% to AED 152 million.
Our Commitment
37
(AED mn)
2013
2014
Change
Revenues
3,547
3,819
8%
EBITDA
2,220
2,369
7%
(AED mn)
2013
2014
Change
Revenues
18,482
20,578
11%
EBITDA
984
1,148
17%
(AED mn)
2013
2014
Change
Revenues
892
1,074
20%
EBITDA
127
152
20%
Ourfinancial
Past, Present
performance
and Future
Holding
Holding
Annual
Annual
Report
Report
2014
2014
- Our
- Our
Past,
financial
Present
performance
and Future
38
Group debt profile
Majid Al Futtaim Group’s Balance Funding Profile
Majid Al Futtaim
Holding Level
(AED 6,358mn)
Our Story
05
17
07
09
12
13
Strategic growth
15
All of which is Senior Unsecured
obligations at Holding level
19
20
23
25
27
Our board
29
All of which is Senior unsecured
obligations at Properties level
Primarily project finance with
limited recourse to borrower
Total gross debt amounted to
AED 9.06bn as at 31 December
2014 (excluding USD 500mn
hybrid issuance)
✓
Maintained focus on conservative liquidity and risk management policies
✓
Well received issuances in the international Debt Capital Markets – in 2014 issued first 10yr bond (USD 500mn)
✓
Other
(AED 1,197mn)
All Senior Unsecured
financing obligations
rank pari passu among
themselves
Our Commitment
People-centric
Majid Al Futtaim
Properties Level
(AED 1,506mn)
Increased Revolver component of bank financing to reduce cost of carry
✓
Cash position of over AED 1,050mn and undrawn available lines of over AED 6.6bn (as of 31-Dec-2014)
✓
Average debt life extended to 5.2 years as of 31 December 2014 , up from 3 years in December 2011
Dec- 2012
Dec- 2013
Dec- 2014
Secured debt as a percentage of Gross Debt
46%
7%
10%
13%
EBITDA from encumbered assets as % of
Total EBITDA
28%
<1%
4%
4%
FIGURES BASED ON FULL YEAR 2014 AUDITED ACCOUNTS USD500MN EQUITY HYBRID IS NOT TAKEN INTO ACCOUNT IN DEBT CALCULATION*
4,500
4,000
3,500
3,000
2,500
2,000
1,500
1,000
500
-
9,000
8,000
7,000
6,000
5,000
4,000
3,000
2,000
1,000
0
4,184
2,472
1,598
683
59
66
2015
2016
8,223
8,489
36
37
Group debt profile
39
43
30,000
Majid Al Futtaim’s
Capital Structure
31
33
41
Our Future
45
2020 ONWARDS
5
7,065
4
1,694
2009
2,279
46%
2.8x
2,736
2,969
2.3x
8,223
2009
2
2.2x
2010
2011
2012
NET DEBT (AED)
2013
NET DEBT/EBITDA (times)
47%
27,923
18,104
21,943
31%
19,668
8,489
2010
NET DEBT (AED mn)
0
2014*
24,164
29%
50%
40%
29%
30%
20%
7,794
7,065
6,912
8,001
10%
5,000
0
3
3,586
1
40%
17,969
3,275
2.2x
15,000
10,000
6
8,001
7,794
3.7x
25,000
20,000
2019
6,912
EBITDA
2018
4.9x
2017
Retail
CEO reflects
Dec- 2011
Debt Maturity
Profile (AED mn)
We have a proven track record of delivering strong financial results on the back
of an effective growth strategy.
Cross guarantees*
03
Majid Al Futtaim’s Robust Capital Structure
Strong Leverage
Metrics
Contents
2011
2012
EQUITY (AED mn)
2013
2014*
0
NET DEBT/EQUITY (%)
FIGURES BASED ON FULL YEAR 2014 AUDITED ACCOUNTS USD500MN EQUITY HYBRID IS NOT TAKEN INTO ACCOUNT IN DEBT CALCULATION
39
Ourfinancial
Past, Present
performance
and Future
Holding
Holding
Annual
Annual
Report
Report
2014
2014
- Our
- Our
Past,
financial
Present
performance
and Future
40
Contents
Our financial health can be attributed to a number of factors.
03
CEO reflects
•
We are a leading MENA asset owner with iconic landmarks in key locations
•
We enjoy market leadership in markets with long-term macro economic potential due to our retail/
consumer focus
•
The company has a low volatility of operating income with diversified income streams and a balanced
financial profile
•
We practice prudent financial management with conservative liquidity and risk management policies; we
enjoy a balanced and well-managed funding profile
Our Story
05
17
25
07
09
12
•
We adhere to a strict best practice corporate governance framework
13
•
We have a strong track record of stability through the financial crisis and geopolitical disturbances
Strategic growth
15
•
We have complementary businesses with cross-synergies that reduce individual business risks
Our Commitment
People-centric
19
20
23
27
Our board
29
31
43
33
36
37
Group debt profile
39
41
Our Future
45
41
Ourfinancial
Past, Present
performance
and Future
Holding
Holding
Annual
Annual
Report
Report
2014
2014
- Our
- Our
Past,
financial
Present
performance
and Future
42
Contents
03
CEO reflects
Our future
Our Story
05
17
25
07
09
12
13
Strategic growth
15
As we pioneer the future we will
continuously strive to achieve
our ambition of doubling the
size of our business in the next
five years.
Our Commitment
People-centric
19
20
23
27
Our board
29
31
43
33
36
37
Group debt profile
39
41
Our Future
45
43
44
Contents
03
As we pioneer the future we will continuously strive to achieve our ambition of doubling the size of our
business in the next five years.
CEO reflects
Great things lie ahead for Majid Al Futtaim as the company embarks on consistent and driven growth. This
motivated growth will include continued investment in existing properties, as well as regional expansion.
Our Story
05
17
25
07
09
12
13
Strategic growth
15
43
Investment in existing properties includes a 36,000 square metre expansion of the iconic Mall of the Emirates,
which is on track for completion in the fourth quarter of 2015. This expansion will incorporate a new, ultrapremium VOX Cinemas experience and 40 new shopping, dining and entertainment outlets, including world-class
retail anchor stores making their debut in the Middle East.
With regards to regional expansion, several large-scale projects are currently under construction in both existing
and new markets. While Dubai remains the core of our business, we are expanding our presence in Egypt, Saudi
Arabia and Oman, in addition to looking to establish a foothold in Africa and Eurasia.
Majid Al Futtaim’s ongoing investments in Dubai continue with the investment of AED 267 million for phase one of
the new City Centre Me’aisem. Expected to open in September 2015, this will be the company’s sixth City Centre in
the UAE, while the seventh one, City Centre Shindagha, is set to open by the end of 2015.
Our Commitment
People-centric
19
20
23
27
Our board
29
31
33
36
37
Group debt profile
39
41
Plans have also been announced for a second ‘My City Centre’ mall. This 5,000 square metre mall will serve
communities in Al Barsha and is scheduled for completion in the third quarter of 2016.
Another innovative project in the pipeline is Al Zahia, Sharjah’s first-ever gated mixed-use community. Developed
by Sharjah Holding, a strategic partnership between Majid Al Futtaim and the Government of Sharjah, this project
aims to create a new living trend in the emirate.
In Egypt we plan to increase our total investment over the next five years from EGP 18 billion (AED 8.4 billion), to
22.5 billion Egyptian pounds (AED 10.5 billion). Projects will include building new malls (including the epic Mall
of Egypt project), the introduction of VOX Cinemas to the Egyptian market, and the expansion of existing shopping
centres. We are also working on expanding our presence in the Kingdom of Saudi Arabia.
Majid Al Futtaim Cinemas also plans on significantly increasing its investment in the VOX Cinemas business from
an initial AED 750 million to a total of AED 1 billion. The funds will facilitate the ongoing enhancement of existing
cinemas in current markets, while also supporting our expansion plans to open new locations in existing and new
MENA markets to attract a further 50 million customers by 2020.
Continuing our growth trend over the past 20 years, our mission for the future is highly ambitious, but also very
achievable. And with this pioneering spirit we hope to create many more great moments for more customers
across an ever-expanding footprint.
Our Future
45
45
Ourfuture
Past, Present and Future
Holding Annual Report
Holding
2014Annual
- OurReport
Past, Present
2014 - and
Our Future
future
46
Contents
03
CEO reflects
Our Story
05
17
25
07
09
12
13
Strategic growth
15
Our Commitment
People-centric
19
20
23
27
Our board
29
CONTACT
31
43
33
36
37
Group debt profile
39
41
CORPORATE BROCHURE
PO Box 91100
Deira MAF Tower 1
Adjacent to Deira City Centre
majidalfuttaim.com
Deira
United Arab Emirates
T +9714 2949999
F +9714 2940217
Our Future
45
47
48

Contents - Majid Al Futtaim

Transcription

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