Emirati conglomerate Majid Al Futtaim reports 18% rise in pre-tax earnings

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Alain Bejjani, Chief Executive Officer of Majid Al Futtaim Holding, poses for a photo during an interview with Reuters in Cairo, Egypt December 4 , 2019. REUTERS/Ehab Farouk

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DUBAI, Aug 24 (Reuters) - Emirati retail conglomerate Majid Al Futtaim, which operates across the Middle East, Africa and Central Asia, reported on Wednesday an 18% rise in pre-tax earnings and said consumer spending habits were changing in response to high inflation.

Privately-held Majid Al Futtaim said earnings before interest, taxes, depreciation, and amortization in the first-half amounted to 1.9 billion dirhams ($517 million), up from 1.6 billion a year ago. Revenue rose 15% to 18 billion dirhams.

It did not disclose a net profit figure.

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Chief Executive Alain Bejjani told Reuters by phone the results were helped by key markets the United Arab Emirates and Saudi Arabia where economic conditions are better than some of its other markets like Lebanon and Egypt.

Majid Al Futtaim owns shopping centres in five countries including UAE and Saudi Arabia and has over 450 franchised Carrefour stores in 16 countries.

It also owns cinemas, retail fashion stores and hotels.

Bejjani said Majid Al Futtaim was watching inflation but expected the business to be able to manage the impact, in part due to what he said was its high liquidity.

He also said consumers in the UAE and Saudi Arabia were now shopping more but spending less, particularly when purchasing groceries, because of high inflation.

"So you see the average basket coming down," he said. "We have to be extremely, I would say, watchful of the inflationary pressures and the supply chain issues during the second half of the year and the first half of '23."

($1 = 3.6729 UAE dirham)

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Reporting by Alexander Cornwell; Editing by Christian Schmollinger

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