Chairman's message

Dear Shareholders,

For the fiscal year 2016, IFA Hotels & Resorts recorded year end revenue of KD 44,017,599 (US$ 143,695,745), with a net profit attributable to the Owners of the parent company totaling KD 3,939,603 (US$ 12,860,860) which is 6.47 fils per share.

Shareholders’ equity increased to KD 64,327,543 (US$ 209,997,692), while the company’s total assets reduced by 1.9% to KD 288,746,239 (US$ 942,614,018) compared to KD 294,321,279 (US$ 967,923,305) for 2015.

Th8 on Palm Jumeirah has made great strides towards completion during the course of 2016, structurally the project topped out in the third quarter and finishing works are progressing well. Despite quite challenging local conditions, demand for the project remains steady and improvements in revenue were seen towards the last quarter by injecting fresh product features and ensuring competitiveness.

May saw the ground breaking on Yotel’s first entry property in Dubai, along Sheikh Zayed road. The property contains 582 cabins and serviced apartments as well as co-working spaces, meeting rooms, gym and pool-deck. The property is scheduled to open in 2018 and work is progressing well.

Alongside this, Yotel also opened a new hotel in Paris’ Charles de Gaulle airport within terminal 2E. Just like all other YotelAir locations, the Paris hotel is bookable by the hour and ideal for travelers with a long layover or looking to catch an early flight. Yotel, Charles de Gaulle is proof that the brand can continue to cross boundaries between affordable air transit and luxury travel at value. Given the youth of the brand we see real range to stretch the Yotel brand globally and at pace.

The year also saw IFA Hotel Investments look to broaden their portfolio of services and also enhance operational capability. One of the key strategies was to tie up with an innovative and expanding hospitality operator which was achieved with our joint venture partnership with Bespoke Hotels, finalized in April this year. Bespoke Hotels currently operates more than 200 properties worldwide with a portfolio under management of over 9,500 rooms. By founding Bespoke Hotels MEA, the group has automatically increased exposure to a world class distribution and operational backbone and further brought a recognized and modern brand to take advantage of the growing holiday home market in the UAE and elsewhere in the region.

The past year saw a key milestone in our South African operation with the delivery of our Zimbali Suites project. KwaZulu-Natal continues to see demand for upmarket secure residential property. The Zimbali Suites project is located next to the Fairmont Hotel and are world-class serviced suites with access to services, activities and amenities already offered at the resort and hotel. This distinctive development also offers investors our exclusive rental program which sees our owners become their own hoteliers.

The wider resort witnessed strong revenue figures through both the main proprietary assets of The Lodge and Fairmont managed hotels, both showing notable resilience amongst stiff competition and a challenging local market.

2016 has seen key development targets met in Zimbali Suites and the continued delivery of The8. Steady revenue in key properties such as Fairmont The Palm and Fairmont Zimbali has been encouraging within a tougher marketplace. Yotel remains a core route for expansion with new assets being both signed as well as brought to market. 2017 should bring the completion of key assets on Palm Jumeirah, with further growth of our operational divisions in both scope and breadth of service and I look forward to a positive 2017.

Sincerely,
Talal Jassim Al-Bahar
Chairman & CEO

Ibrahim Saleh Al-Therban
Vice Chairman