Retal profit falls as quarterly revenue hits record

The profit decline matters because it shows how quickly margins can narrow in the kingdom’s property sector even as top-line growth holds up. Retal said quarterly revenue reached the highest level in its history, lifted by a 14.2% rise in development-contract income as completion rates improved across existing projects.

The company’s nine-month numbers tell a more mixed story. Revenue rose 13.8% to 1.97 billion riyals, but net profit dropped 50.6% to 93.7 million riyals as gross profit came under pressure from costs at later-stage projects and development spending tied to strategic real estate opportunities. Retal also booked 17.3 million riyals from the partial liquidation of one fund in which it holds an interest, and said its equity attributable to shareholders climbed 20.8% to 1.1 billion riyals.

For investors, the takeaway is that Retal is still scaling, but execution costs are rising fast enough to cap earnings leverage. The stock will likely remain sensitive to whether the company can keep converting record revenue into stronger bottom-line growth as delivery costs, marketing outlays and project mix continue to move against margins.