Press Release

Kuwait- 18 May 2009

• Rashid Al Nafisi: We adopted a hedge policy to safeguard the interests of shareholders

• Eng. Khalid Esbaitah: Our overall indebtedness does not exceed 15% of shareholders funds

• Allocations led to amend the dividend from 50% cash to 10% bonus

During the annual and extraordinary general meetings of Al Mazaya Holding, held yesterday with 83.56% attendance, the company agreed to increase its assets from KD 45,406,980 to KD 49,947,678 by giving 10 percent bonus shares to shareholders registered in the company’s records as of the date of the assembly (value of KD 4,540,698). The bonus shares are to be deducted from posted profits records as of 31 December 2008.

Thus, Al Mazaya’s assets amounted to KD 49,947,678 (forty-nine million, nine hundred and forty-seven thousand, six hundred and seventy-eight Kuwaiti Dinars) distributed over 499,476,780 stocks. All stocks are monetary stocks, with 100 fils for each stock, and all shares are cash shares.

During Al Mazaya’s general meeting, Mr. Rashid Al Nafisi, Chairman of Al Mazaya Holding, said, “2008 was full of dramatic changes, and saw tremendous growth and expansion in the company’s projects and activities, which resulted in Al Mazaya posting an outstanding net profit of KD53 million for the first nine months of 2008, while the earnings per share reached 130 fils”.

“Responding to the ongoing global economic crisis and its apparent impact on market movement, as well as numerous debtors defaulting on their outstanding payments to the company, Al Mazaya has adopted hedging policies and launched a series of measures to help cushion the firm from the impact of the global financial crisis. These measures included posting approx KD70 million provisions within the 2008 profits in order to safeguard the stability and continuity of the company, as well as protect its funds in the future. These provisions resulted mainly from the decreased market price of the Waterfront land, purchased by Al Mazaya for KD44 million, along with the KD 10 million decrease in the market value of certain of the company’s investments, and provisions for bad debts, which have been estimated at approximately KD 16 million,” added Al Nafisi.

Al Nafisi gave a detailed presentation of Al Mazaya’s financial performance for 2008. Al Mazaya’s total assets reached KD 365,038,496, compared to KD 250,654,566 in 2007, while its total liabilities reached KD 209,559,818, against KD 151,329,648 in 2007, and shareholders’ equity reached KD 155,478,678, compared to KD 99,324,918 in 2007.

As for net profits, Al Mazaya achieved a net profit of KD 13,046,148 for the 2008 fiscal year, compared to the KD 24,570,577 profit achieved in 2007, and earnings per share reached 31.86 fils, compared to 67.36 fils recorded in 2007.

Al Nafisi said that, as a result of 2008 operations and the local and regional economic changes, the Board of Directors recommended 10 percent bonus shares, i.e. 10 shares for every 100 shares owned.

Speaking during the transparency seminar that was held alongside the general meeting, Eng. Khalid Esbaitah, Vice Chairman and CEO of Al Mazaya Holding, said of the company’s 2008 projects and current plans: “A series of studies conducted by Al Mazaya on local and regional markets show that the residential and commercial rental markets in Kuwait – and the region in general – are likely to see more demand than the property sale markets. The company has therefore decided to focus on previously launched projects, with the intention of finalizing these projects as soon as possible. Consequently, apparent progress has been achieved in these projects, with three of the most important Al Mazaya projects scheduled to open in 2009, namely ‘7 Zones’, ‘Clover Clinic’, and ‘Kuwait Business Town’, which caters to the demand for office space”.

Esbaitah talked about his company’s plans to complete current and future projects within Kuwait and abroad. Esbaitah said that Al Mazaya is studying several projects and profitable opportunities. The 7 Zones’ project, which covers a total area of 22,500 square meters and costs KD 10 million, is considered as a revenue generating project, and has been 100 percent completed. Al Mazaya has registered the ‘7 Zones’ trademark as an exclusive brand for the company and is planning to expand the concept into Bahrain, the UAE, Jordan, Lebanon and other countries in the region.

Al Mazaya has also made significant progress in the ‘Clover Clinic’ project, the company’s first investment in the healthcare sector. The KD 7-million project occupies 4,000 square meters and will be operated on a build, operate, transfer (B.O.T.) basis. Al Mazaya will register this trademark as an exclusive brand for the company, and is planning to expand the concept into other GCC markets.

Esbaitah went on to say that Al Mazaya completed and delivered a number of projects in 2008 in the UAE, including Sky Gardens and the Icon 1&2 Towers in Jumeirah Lakes, Dubai. These projects have been completely sold. The Business Avenue, which comprises a number of commercial towers, has been 60 percent completed, and the Queue Point project at Al Liwan, which extends across an area of 1.2 million square metres and comprises 22 plots, has been 90 percent sold, and enabling and excavation works on the project have been completed. Al Mazaya has also made significant progress on the KD5.8 million ‘The Villa’ project, which includes 600 villas and occupies an area of 154,302 square meters.

Esbaitah concluded his speech by saying, “Despite the company’s conservative geographical expansion plan for 2009, Al Mazaya will continue to work on completing our projects according to schedule, and delivering on our promises to investors and clients. The list of ongoing projects includes the OMR6 million Al Badia Residential Project in Sahar, Oman, as well as Al Mazaya’s joint venture with Saudi and Kuwaiti parties to build a villa complex in Al Ahsa on land acquired at a value of SR125 million. Al Mazaya will also build a 62-storey ‘Al Mazaya Tower’ at a strategic location on Dubai’s Sheikh Zayed Road, where the company has acquired a plot of land at a value of KD20 million. Al Mazaya has also acquired four plots of land in the Dubai Waterfront at a value of KD41 million and a 5,906 square meter plot in the Morina Residence development in Abu Dhabi”.

At the end of the general meeting, Al Mazaya’s Board of Directors was re-authorized to buy 10 percent of total assets for 18 months, according to item no. 132 issued in 1968 and item no. 15/1987 executed by the Minister of Commerce and Industry. The Board of Directors was also re-assigned with the issuing of stocks in Kuwaiti Dinars or any currency it sees fit, as per Kuwaiti laws and regulatory legislations.