Bahri Annual Report-2011

Board of Directors Report 2011

Financing and Investment

liquidate these investments when needed to finance its operations. The Company’s financial policies are compatible with the nature of its business and assets. The Company’s assets are managed proportionate to the stated useful life and the expected returns of the assets. This leads to flexibility in cash flow that enables the Company to meet its local and international obligations. By the end of 2011, total financing of the Company’s assets reached SAR 4.82 billion. Bahri expects that financing will reach its maximum level of SAR 4.96 billion by the end of 2013 before it will start to diminish gradually depending on the current financing agreements.

With a strong financial position and abundant surplus cash, Bahri is capable of meeting its obligations and financing its various projects. Additionally, Bahri has maintained strong relationships with local and international financial institutions over the past years and adopted Sharia-compliant investment financing policies. According to these policies, 88% of the Company’s loans have been converted to Sharia-compliant financing instruments. The proportion of the Sharia-compliant financing will reach 100% upon repayment of the current outstanding conventional commercial loans. The Company pursues a conservative financial policy in the investment of its surplus cash in low risk investments rendering it easier to

Financing during 2011 (In Thousands Saudi Riyals)

Loan balance at the beginning of the year

Average Financing Period in Years

Drawn during the year

Repayments during the year

Loan balance at year end

Company

Bahri

2,313,762

11

228,520

(228,323)

2,313,959

NCC

1,810,056

10.5

770,045

(96,425)

2,483,676

Mideast Ship Management Ltd.

19,369

7

---

(1,991)

17,378

Total

4,143,187

---

998,565

(326,739)

4,815,013

Murabaha Financing and Long Term Loans

2,500

2,246

2,000

1,500

1,000

532

522

504

0.500

492

456

0

In Million (Saudi Riyals)

2012

2013

2014

2015

2016

Thereafter

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