Thank you. Good afternoon to you all, and I would like to welcome you to the Ezdan Holding Group 4Q and FY 2025 earnings conference call.

On today's call from Ezdan's management team, we have Tamer Fawzy, who is the Group Chief Financial Officer, and Taha Moursi, who is the Financial Controller and IR Officer. On the call today, the management team will first go over the numbers, and then after that we have a Q&A session.

Let me turn over the call to Taha to take over. Please go ahead, sir.

Thanks. Good afternoon, everyone.

Thank you for joining us today in Ezdan Holding Group conference call to discuss the financial performance and position of the company for 2025. We have made the investor's presentation for this conference call available on our website www.ezdanholding.qa under Investor Relations section.

Before proceeding, we would like to provide a disclaimer that some of the information that will be discussed here might contain projections or other forward-looking statements regarding future events or future financial performance of Ezdan Holding Group. Such forward-looking statements include those that are not historical facts, speak only as of when it is made.

Ezdan undertakes no obligation to publicly update or publicly revise any forward-looking statements, whether because of new information, future events, or otherwise. The conference call will include three parts.

First part will be about comparing financial performance of '25 with '24. Second part will be about financial position compared between '25 and December '24.

Third part will be a brief of the cash flow in '25 compared to '24. Regarding the first part, which is related to financial performance, Ezdan achieved a net profit for its owners of around 114 million compared to 105 million.

The profit or loss statement contains main changes in the following factors: finance costs decreased by approximately 277 million compared to last year; the group recognized a gain on sale of investment properties and assets held for sale of around 121 million; rental income increased by around 58 million; the group recorded a loss on revaluation of investment properties of approximately 660 million compared to 198 million in previous year. Main ratios for financial performance were as follows: operating gross margin improved from 81% to 82%; net profit margin remained stable at 6% in line with last year.

In terms of the components of profit or loss statement, Ezdan recognized a rental income of 1.8 billion compared to 1.75 billion in the previous year, reflecting an increase of approximately 58 million representing around 3.3% as a gross. The increase in rental revenue was mainly driven by gross across key operating segments, including increase in residential segment by 3%, increase in hotel segment by 6%, and increase in mall segment by 14%.

The main statistics for residential segment showed an average occupancy rate of around 89.4% compared to 89.2% in previous year, while the average revenue per unit remained stable at 4.4k for both '25 and '24, and the average total units available for rent were approximately 33k units. The main statistics for hotel segment were an average occupancy rate of around 86% compared to 79%, with an average daily rate for Ezdan Palace of 432 per day compared to 439 per day, and for Ezdan Hotel West Bay of 173 per day compared to 177 per day.

The main statistics for mall segment were average occupancy rate was around 90%-- 91% for '25 and '24. Concerning operating expenses, operating expenses decreased by around 10 million from 353 to 343 million, which represent a decrease by a percentage of 3%.

On a component basis, the decrease was mainly in sewage expenses with around 11 million. On a segment basis, the decrease was mainly in residential segment of 10 million.

Operating profit from main operations increased from 1.48 billion in '24 to 1.55 billion in '25, with an increase of around 66 million representing 4.5%. On a segment basis, operating profit for residential segment increased from 1.28 billion to 1.32 billion, with a gross margin of 85% compared to 84% in '24.

For hotel segment, operating profit increased from 139 million to 146 million, with a gross margin improving from 65% to 67%. Operating profit for mall segment increased from 64 million to 75 million, with gross margin improving from 67% to 70%.

For gain on sale of investment property and assets held for sale, during the year, the group sold Ezdan Compound 40 and specific residential units for around 607 million, which had a carrying value of 486 million, resulting in a recognized gain on sale of 121 million. For gain from foreign currency exchange, the group recognized a forex gain of 17 million compared to a loss of 8 million in '24, mainly from changes in the exchange rates of the British pound sterling.

Regarding finance costs, finance costs decreased by 277 million from 1 billion to one-- to 778 million, representing 26%, mainly due to decreasing of borrowing rates and profit margins. Now we are going to the second part, which is related to the financial position.

The group has a total assets of around 45.6 billion compared to 46.3 billion. Cash and bank balances were 511 million compared to 113 million, with an increase of around 398 million.

Investment properties decreased by 1.3 billion from 45.5 to 44.1 billion, mainly due to disposing of Ezdan Compound 40 with a book value of 299 million and reclassifying investment properties of 420 million as assets held for sale, in addition to revaluation loss of 600-- 660 million. Total liabilities were 12 billion compared to 12.9 billion.

Trade and other payables have decreased by around 20 million. Due to related parties have fully settled by 1.4 billion.

Islamic borrowings have increased by a net amount of 546 million, that increase from obtaining new facilities of around 4.5 billion, related finance costs of around 673 million, and repayment of around 4.6 billion during the year. Total equity, including non-controlling interest, increased from 33.4 billion to 33.5 billion, with an increase of around 104 million.

Share capital of Ezdan is 26.5 billion. Regarding retained earnings, retained earnings have increased by 56 million, representing net profit for the year of 114 million, transferring a portion of retained earnings to legal reserve of 11 million, and transfer of accumulative share of non-controlling interest of 155 million.

Regarding the last part, which is the cash flow statement, net cash flows from operating activities were 1.43 billion compared to 1.36 billion. Net cash flows from investing activities was 585 million compared to net cash flow used in investing activities of 63 million.

Net cash flow used in financing activities were 1.6 billion compared to 1.56 billion. Thank you, and we are open for any questions you may have.

Thank you for the presentation. Could you give us some color on what was this downgrade of all these provisions on investment properties, revaluation of investment properties?

Which properties were these, and what was the rationale to revalue them lower? Thank you.

Thanks for your questions. Regarding investment properties of Ezdan, we are talking about 45 billion.

If you go back to the sensitivity analysis of the financial statements, you find that any 50 basis point, for example, changes in WACC or terminal growth rate, it will affect a huge amount of investment properties. During this year, the terminal growth rate that has been used by valuator has been decreased from 2.2% last year to 2.185% this year.

That mainly the main reason behind this decrease in the valuation of investment properties.

Sorry, what was decreased?

We are talking about the full portfolio. It is not specifically.

I'm a bit confused. You said that the loss is because of the decline in WACC.

Is that correct?

No, declining in terminal growth rate.

Terminal yield, basically. Terminal income.

Terminal growth rate because terminal yield

now [unclear]. Terminal growth rate, okay.

Okay.

Terminal growth rate. Last year was 2.2%.

This year 2.185%. This little decrease affect this amount, because we are talking about 46 billion as investment properties.

Any basis point, for example, 10 basis point decrease or increase in the terminal growth rate affect significantly on the valuation of investment properties.

This as... This growth...

What? Tell me.

Sorry,

please go ahead. If you return back to the sensitivity analysis, you will find that the changes by 50 basis point in terminal growth rate will affect the valuation of investment properties by around from 3 to 4 billion.

This terminal growth rate, this was changed by your valuation company, the company that does the valuation?

Exactly, yes, because this is the inputs that's coming from their side. I think based on the average five years of the market growth rate and inflation rates, all these factors.

They changed this because of the market five-year average of the market growth rate.

Yes, exactly.

Okay. Thank you.