“Senomi Centers” Saudi Arabia recorded a 19.1% decline in its net profits during the third quarter

The net profit attributable to the shareholders of the Saudi “Sinomi Centers” company declined by 19.1 percent on an annual basis during the third quarter of 2026, to reach 404.9 million riyals ($108 million), compared to about 500.7 million riyals ($133.5 million) in the same period last year, despite the growth in revenues and the improvement of a number of the company’s operational and financial indicators.

The company's financial results showed an increase in revenues by 10 percent to 606.2 million riyals ($161.7 million), compared to 551.3 million riyals ($147 million) in the third quarter of 2025. It also increased by 6.5 percent compared to the second quarter of the current year, in which it recorded 569.4 million riyals.

In contrast, adjusted net profit rose to 417.9 million riyals ($111.4 million), an increase of 32.8 percent year-on-year, compared to 314.7 million riyals in the corresponding period. This indicator reflects the company's performance after excluding some items, and should not be confused with the announced net profit, which declined during the period.

In terms of costs, the cost of revenues rose to 145.9 million riyals ($38.9 million), compared to 99.4 million riyals ($26.5 million) a year ago. On the other hand, impairment losses on receivables, balances with related parties, and accrued revenues decreased by 78 percent to 17.8 million riyals, compared to about 81 million riyals.

Net financing costs also decreased by 22.4 percent to 138.6 million riyals ($37 million), compared to 178.6 million riyals in the third quarter of last year, while fair value gains on investment properties increased by 19.6 percent to 215.1 million riyals ($57.4 million), compared to 179.9 million riyals.

At the operational level, the number of visitors to the company’s malls increased to 39 million visitors during the third quarter, an increase of 20.7 percent compared to 32.3 million visitors in the same period last year, as the mall portfolio continues to expand and attract new brands.

Nine-month results

During the first nine months of 2026, Sinomi Centers’ revenues increased by 1.9 percent to 1.758 billion riyals ($468.8 million), compared to about 1.725 billion riyals ($459.9 million) in the corresponding period last year.

But the declared net profit fell by 16.6 percent to 993.1 million riyals ($264.8 million), compared to 1.19 billion riyals ($317.5 million) in the first nine months of 2025. The adjusted net profit stabilized at 1.031 billion riyals ($274.9 million), recording a slight growth of about 0.5 percent compared to the corresponding period.

The cost of revenues increased during the period to 335 million riyals ($89.3 million), compared to 271.6 million riyals, and net financing costs increased to 572.9 million riyals ($152.8 million), compared to 489.1 million riyals ($130.4 million).

On the other hand, impairment losses on receivables and related balances decreased by 74.7 percent to 59.3 million riyals, compared to 234.5 million riyals, while fair value gains on investment properties increased by 6.5 percent to 537.9 million riyals ($143.4 million), compared to 505 million riyals.

The announced earnings before interest, taxes, depreciation and amortization amounted to 1.104 billion riyals ($294.4 million), compared to 1.239 billion riyals ($330.5 million) in the corresponding period. As for adjusted earnings before interest, taxes, depreciation and amortization, it increased by 5.3 percent to 1.125 billion riyals ($300.1 million), compared to 1.068 billion riyals ($284.9 million).

The company's centers recorded 109 million visits during the first nine months, an increase of 10.3 percent year-on-year, while the like-for-like occupancy rate reached 91.8 percent.

Expansion and attraction of brands

In terms of operational activities, the company attracted 162 brands during the third quarter, including 110 international brands and 52 local brands, and it renewed 1,997 lease contracts during the first nine months of the year.

Regarding its new projects, Westfield Jeddah entered the operating phase on July 30, 2026, after the pre-leasing rate reached about 97 percent, with the preparation of commercial units continuing.

As for the “Westfield Riyadh” project, the structural work has reached 100 percent, and the pre-leasing rate has reached 95 percent, with the start of operation targeting during the fourth quarter of this year.

The British bank Barclays is returning to the Saudi market by opening a new office in the King Abdullah Financial Center in Riyadh, more than a decade after it withdrew from it, in a step that reflects the continued interest of international financial institutions in investment opportunities in the Kingdom, despite the security and economic challenges imposed by the regional war and the escalation of Houthi attacks.

On Monday, the bank announced the opening of its new office, after obtaining a license to practice investment banking services and global markets activities in the Kingdom, and completing in 2025 the procedures for obtaining a license for its regional headquarters in Riyadh, according to what was reported by “Bloomberg.”

Barclays appointed Majed Al-Hassoun as CEO and head of investment banking at Barclays Capital Saudi Arabia, according to the bank’s statement.

The bank’s obtaining a regional headquarters license represents an important step in its return to the Kingdom, in light of the Kingdom’s tendency to attract international institutions and companies to establish their regional headquarters in Riyadh, linking this to its continued access to business opportunities and contracts with government agencies.

Barclays' expansion in the Kingdom comes as part of a broader strategy to strengthen its presence in the Middle East. The bank's CEO in the Asia-Pacific region, Jaideep Khanna, told Bloomberg in October that the bank is betting strongly on the opportunities available in the region, indicating its plans to strengthen its business in Turkey as well.

The bank strengthened its presence in the Gulf private banking sector through new appointments, and also transferred a banker specializing in capital markets from London to Dubai to assume a broader regional role.

On November 1, the Saudi Capital Market Authority announced that Barclays Capital Saudi had fulfilled the requirements to begin practicing the activities of arranging and providing advice in the securities business, which it is licensed to practice according to the decision of the Authority’s Board issued on October 26, 2025. This comes as a continuation of the bank’s step in October 2025, when it announced that it had obtained a temporary license from the Authority to practice investment banking services and global markets activities, in preparation for activating its business in the Kingdom.

The CEO of Barclays Group, CS Venkatakrishnan, had previously confirmed that Saudi Arabia represents a key focus in the bank’s growth strategy in the Middle East region, expressing his aspiration to support the Kingdom’s ambitions within the framework of “Vision 2030.”

Official Chinese data revealed a widening gap between producer and consumer prices in October, with factory price inflation accelerating to the highest level in about four and a half years, driven by rising costs of energy and raw materials, while consumer inflation slowed due to weak domestic demand, which still limits the ability of companies to pass on increases in production costs to consumers.

The National Bureau of Statistics announced, on Monday, that the producer price index rose by 5.7 percent on an annual basis during October, compared to an increase of 5 percent in September, exceeding analysts’ expectations of an increase of 5.3 percent. This represents the fastest rate of increase since June 2022, when the index rose 6.1 percent, according to LSEG data.

On the other hand, the consumer price index recorded an increase of 0.7 percent on an annual basis, down from 0.9 percent in the previous month, and came below analysts’ expectations of 0.8 percent. Core inflation, which excludes more volatile food and energy prices, also slowed to 0.8 percent from 1 percent in September.

This discrepancy reflects the impact of rising global energy prices, in light of the war in the Middle East, on production costs, especially in the sectors of coal mining, oil and natural gas extraction and processing, chemical industries, and other energy-intensive activities. But these pressures have not been fully transmitted to the prices of goods and services that consumers buy, in light of the continued weakness of household spending in the second largest economy in the world.

Nguyen Hoang Nam, an economist specializing in China at Capital Economics, said that the price shock resulting from the conflict in the Middle East will keep inflation high in the coming months, but its impact is expected to decline next year. He expected producer prices to return to deflation, as was the case before the outbreak of war, while he expected consumer price inflation to average 0.4 percent during 2027.

Deflationary pressures despite the recovery in exports

The data comes at a time when the Chinese economy is still facing an imbalance between strong production and weak domestic demand, despite its growth more than expected during the third quarter, supported by the resilience of exports in the face of trade challenges and the slowdown in consumer activity.

An official with the Chinese State Planning Commission warned last month that external shocks were beginning to have a greater impact on economic activity, as the gap between strong supply and weak domestic demand persisted.

Analysts believe that Chinese companies are facing difficulty in passing on the increase in energy and raw materials prices to customers and consumers, which puts pressure on their profit margins and reflects the continued deflationary pressures inherent in the economy, despite the return of price indicators to the positive zone.

Zhang Qiwei, chief economist at Pinpoint Asset Management, said that consumer price inflation remaining at low levels reflects continued weakness in domestic demand, noting that the authorities have not yet launched major economic stimulus. He added that strong export growth may be one of the reasons why Beijing is not in a rush to approve a new stimulus package.

The Chinese economy had faced more than three years of deflationary pressures before the war in the Middle East led to higher energy costs and moved the producer and consumer price indexes towards positive growth. But the slowdown in the real estate market and weak consumption continue to hamper the recovery in domestic demand.

On the other hand, deflationary pressures and a weak currency have contributed to enhancing the competitiveness of Chinese exports, which has increased policymakers’ reliance on external demand to support growth, at a time when the authorities are still cautious about launching large-scale fiscal stimulus. Measures to support capital market stability and limit the rapid rise of the yuan, which is pressuring exporters' margins, have also not succeeded in bringing about a tangible improvement in consumer confidence.

This also comes amid a decline in the shares of companies related to artificial intelligence in the Chinese market, after high valuations and concerns about the demand for these technologies and US export restrictions, which may add further pressure on consumer spending.