Marka CEO Says Firm To Turn Profitable In Q4, Looks At New Buys

Dubai’s Marka, a retail and restaurant start-up that listed on the emirate’s bourse last year, expects to turn profitable in the fourth quarter of 2015 as it boosts revenue with new acquisitions, its chief executive said on Monday.

Marka, which listed in September, stated in its flotation prospectus that it would turn profitable in 2017.

Much of the company’s activity, and its cash, are going into acquiring businesses and franchise rights to build up its asset portfolio, Chief Executive Nick Peel said. It has signed deals with seven fashion brands which he described as niche.

“They are particularly high margin, emerging brands in their own markets…we have another couple of acquisitions in the sports sector in mind,” Peel told reporters at a media event. “We’re hoping these will come to fruition in the next three to six months.”

Peel said Marka was also looking at four asset purchases in the food and beverage sector and aimed to complete two by the end of April and the other two in the first half of 2015. He gave no value for the deals.

“From an acquisition perspective we’re looking to modest-sized businesses that are already delivering strong revenue and EBITDA, but are in need of investment and their management team is in need of some expertise,” said Peel.

“Our focus is on the UAE in years one and maybe two, the wider Gulf region years two to three – we will have four to five brands that will have international scalability but we will only attack international markets in years three to five.”

In December, Marka said it had agreed to buy sporting goods firm Retailcorp from Istithmar World, a unit of state-owned conglomerate Dubai World for Dhs220 million ($60 million).

Marka’s listing ended a five-year hiatus on initial public offers on Dubai’s main stock exchange after a $75 million share sale.