* Q1 net down 31.5 percent at 273 million riyals
* Compares with forecast 342.0 million
* Op profit 339.6 million vs 435 million year ago
(Adds details, background)
By Asma Alsharif
RIYADH, April 20 (Reuters) - Dar al-Arkan 4300.SE, Saudi Arabia’s biggest property developer, reported a 31.5 percent drop in first-quarter net profit, the company said in a bourse statement on Wednesday, missing analyst forecasts.
Dar al-Arkan made 273 million riyals ($72.8 million) in the three months to end-March, down from 398.6 million in the same period a year earlier.
Analysts surveyed by Reuters on averge expected the firm to post a net profit of 342.0 million riyals. [ID:nLDE7390BS]
The developer attributed the loss to a decline in sales revenue and profit margins during the period, without being specific.
While Saudi Arabia is facing a shortage in housing supply, Dar Al-Arkan said it is seeing lower demand and lower profit margins resulting from the geographic locations of the land plots being sold.
Some 80 percent of Dar al-Arkan’s assets of about 23 billion riyals are land plots in the kingdom where analysts say properties are hard to value.
The developer’s operational profit dropped 22 percent to 339.6 million riyals in the quarter, compared with 435 million riyals in the same quarter a year earlier.
Dar al-Arkan has to repay a $1 billion sukuk maturing in 2012 and said in November it may resort to selling some assets to cover its debt. [ID:nLDE6AQ00R]
Saudi Arabia is facing a shortage in housing due to rapid population growth and an inflow of expatriate workers coming into the kingdom, which has over 27 million people.
A report by Banque Saudi Fransi in March said private and public developers need to build about 275,000 units a year through 2015 to meet the country’s demands for about 1.65 million new homes. [ID:nLDE72J0E6]
Also last month King Abdullah announced $93 billion in social handouts which included 250 billion riyals ($66.7) to be spent on 500,000 new homes in the country.
Dar al-Arkan’s shares slid 1.6 percent to 9.2 riyals on Wednesday, before the earnings were announced, underperforming the all-share index .TASI which gained 0.8 percent. (Editing by David Holmes)