RAK Properties — Interim / Quarterly Report 2026

May 11, 2026

RAK Properties P.J.S.C. and its Subsidiaries

Interim Condensed Consolidated Financial Statements (Unaudited)

For the period ended 31 March 2026

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RAK Properties P.J.S.C. and its Subsidiaries
Interim Condensed Consolidated Financial Statements (Unaudited)
For the period ended 31 March 2026

Table of Contents

Section	Page(s)
Report on review of interim condensed consolidated financial statements	1
Interim condensed consolidated statements of financial position	2
Interim condensed consolidated income statement	3
Interim condensed consolidated statement of comprehensive income	4
Interim condensed consolidated statement of changes in equity	5
Interim condensed consolidated statement of cash flows	6
Notes to the interim condensed consolidated financial statements	7 - 23

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REPORT ON REVIEW OF INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS TO THE BOARD OF DIRECTORS OF RAK PROPERTIES P.J.S.C.

Introduction

We have reviewed the accompanying interim condensed consolidated statement of financial position of RAK Properties P.J.S.C. (the "Company") and its Subsidiaries (the "Group") as at 31 March 2026 and the related interim condensed consolidated income statement, interim condensed consolidated statement of comprehensive income, interim condensed consolidated statement of changes in equity and interim condensed consolidated statement of cash flows for the three-month period then ended and explanatory notes. The Management of the Company is responsible for the preparation and presentation of these interim condensed consolidated financial statements in accordance with International Accounting Standard 34 "Interim Financial Reporting". Our responsibility is to express a conclusion on these interim condensed consolidated financial statements based on our review.

Scope of Review

We conducted our review in accordance with the International Standard on Review Engagements 2410, "Review of Interim Financial Information Performed by the Independent Auditor of the Entity". A review of interim condensed consolidated financial information consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

Conclusion

Based on our review, nothing has come to our attention that causes us to believe that the accompanying interim condensed consolidated financial statements are not prepared, in all material respects, in accordance with IAS 34.

12 May 2026

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RAK Properties P.J.S.C. and its Subsidiaries

Interim condensed consolidated statement of financial position

As at 31 March 2026 (Unaudited)

| | Notes | 31 March
2026
AED '000
(Unaudited) | 31 December
2025
AED '000
(Audited) |
| --- | --- | --- | --- |
| ASSETS | | | |
| Non-current assets | | | |
| Property and equipment | 3 | 1,901,908 | 1,884,425 |
| Investment properties | 4 | 1,386,188 | 1,406,611 |
| Trading properties under development | 5 | 2,276,904 | 2,291,964 |
| Investments at fair value through other comprehensive income | 6 | 17,252 | 17,440 |
| Investment in joint ventures | 7 | 103,281 | 99,936 |
| Trade and other receivables | 8 | 614,016 | 687,654 |
| Total non-current assets | | 6,299,549 | 6,388,030 |
| Current assets | | | |
| Trading properties under development | 5 | 290,623 | 245,714 |
| Trading properties | 9 | 38,970 | 33,829 |
| Trade and other receivables | 8 | 1,631,555 | 1,520,686 |
| Bank balances and cash | 10 | 558,997 | 517,909 |
| Total current assets | | 2,520,145 | 2,318,138 |
| TOTAL ASSETS | | 8,819,694 | 8,706,168 |
| EQUITY AND LIABILITIES | | | |
| Equity | | | |
| Share capital | 11 | 3,000,000 | 3,000,000 |
| Share premium | | 114,120 | 114,120 |
| Statutory reserve | | 1,068,522 | 1,068,522 |
| Treasury shares | 11 | (4,175) | (3,208) |
| Retained earnings | | 1,077,128 | 1,037,874 |
| Other reserves | 12 | 725,499 | 724,662 |
| Total equity | | 5,981,094 | 5,941,970 |
| Non-current liabilities | | | |
| Employees' end-of-service benefits | | 10,033 | 10,239 |
| Borrowings | 13 | 520,217 | 569,003 |
| Deferred government grants | | 331,072 | 333,694 |
| Deferred tax liability | | 10,139 | 10,139 |
| Trade payable, accruals and other liabilities | 14 | 803,932 | 700,314 |
| Total non-current liabilities | | 1,675,393 | 1,623,389 |
| Current liabilities | | | |
| Borrowings | 13 | 589,326 | 441,962 |
| Provision for income tax | | 39,367 | 35,743 |
| Trade payable, accruals and other liabilities | 14 | 534,514 | 663,104 |
| Total current liabilities | | 1,163,207 | 1,140,809 |
| Total liabilities | | 2,838,600 | 2,764,198 |
| TOTAL EQUITY AND LIABILITIES | | 8,819,694 | 8,706,168 |

Abdul Aziz Abdullah Al Zaabi
Chairman

Sameh Muhtadi
Chief Executive Officer

The accompanying notes 1 to 24 form an integral part of these interim condensed consolidated financial statements.

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RAK Properties P.J.S.C. and its Subsidiaries

Interim condensed consolidated income statement

For the three-month period ended 31 March 2026 (Unaudited)

	Notes	Three-month period ended
		31 March 2026
AED '000
(Unaudited)	31 March 2025
AED '000
(Unaudited)
Revenue	15	277,985	370,271
Cost of revenue	15	(162,637)	(223,682)
GROSS PROFIT		115,348	146,589
Share of profit from joint ventures		3,345	1,818
Gain on sale of investment properties	4	1,584	-
Selling, general and administrative expenses	16	(73,521)	(60,990)
Other income		7,360	1,885
OPERATING PROFIT		54,116	89,302
Finance costs		(15,203)	(19,428)
Finance income		4,802	4,591
NET PROFIT FOR THE PERIOD BEFORE TAX		43,715	74,465
Income tax expense	17	(3,624)	(6,559)
NET PROFIT AFTER TAX FOR THE PERIOD		40,091	67,906
Earnings per share for the period – basic and diluted (AED)	19	0.013	0.023

The accompanying notes 1 to 24 form an integral part of these interim condensed consolidated financial statements.

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RAK Properties P.J.S.C. and its Subsidiaries

Interim condensed consolidated statement of comprehensive income
For the three-month period ended 31 March 2026 (Unaudited)

	Three-month period ended
	31 March 2026	31 March 2025
	AED '000 (Unaudited)	AED '000 (Unaudited)
NET PROFIT AFTER TAX FOR THE PERIOD	40,091	67,906
Other comprehensive income	-	-
TOTAL COMPREHENSIVE INCOME FOR THE PERIOD	40,091	67,906

The accompanying notes 1 to 24 form an integral part of these interim condensed consolidated financial statements.

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RAK Properties P.J.S.C. and its Subsidiaries

Interim condensed consolidated statement of changes in equity
For the three-month period ended 31 March 2026 (Unaudited)

| | Share capital
AED '000 | Share premium
AED '000 | Statutory reserve
AED '000 | Treasury shares
AED '000 | Retained earnings
AED '000 | Other reserves
AED '000 | Total equity
AED '000 |
| --- | --- | --- | --- | --- | --- | --- | --- |
| Balance at 1 January 2026 (Audited) | 3,000,000 | 114,120 | 1,068,522 | (3,208) | 1,037,874 | 724,662 | 5,941,970 |
| Net profit for the period | - | - | - | - | 40,091 | - | 40,091 |
| Other comprehensive income for the period | - | - | - | - | - | - | - |
| Total comprehensive income for the period | - | - | - | - | 40,091 | - | 40,091 |
| Treasury shares | - | - | - | (967) | - | - | (967) |
| Transfer to other reserves | - | - | - | - | (837) | 837 | - |
| Balance at 31 March 2026 (Unaudited) | 3,000,000 | 114,120 | 1,068,522 | (4,175) | 1,077,128 | 725,499 | 5,981,094 |
| | Share capital
AED '000 | Share Premium
AED '000 | Statutory reserve
AED '000 | Treasury Shares
AED '000 | Retained earnings
AED '000 | Other reserves
AED '000 | Total equity
AED '000 |
| Balance at 1 January 2025 (Audited) | 3,000,000 | 114,120 | 1,028,092 | (22,615) | 684,829 | 722,571 | 5,526,997 |
| Net profit for the period | - | - | - | - | 67,906 | - | 67,906 |
| Other comprehensive income for the period | - | - | - | - | - | - | - |
| Total comprehensive income for the period | - | - | - | - | 67,906 | - | 67,906 |
| Board of Directors' remuneration | - | - | - | - | (8,000) | - | (8,000) |
| Transfer to other reserves | - | - | - | - | (980) | 980 | - |
| Balance at 31 March 2025 (Unaudited) | 3,000,000 | 114,120 | 1,028,092 | (22,615) | 743,755 | 723,551 | 5,586,903 |

The accompanying notes 1 to 24 form an integral part of these interim condensed consolidated financial statements.

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RAK Properties P.J.S.C. and its Subsidiaries

Interim condensed consolidated statement of cash flows
For the three-month period ended 31 March 2026 (Unaudited)

		Three-month period ended
		31 March
2026
AED '000
(Unaudited)	31 March
2025
AED '000
(Unaudited)
	Notes
OPERATING ACTIVITIES
Net profit before tax for the period		43,715	74,465
Adjustments for:
Depreciation	3	17,814	17,595
Provision for employees' end-of-service benefits		591	864
Amortisation of government grants	15	(2,622)	(3,712)
Expected credit losses on trade and other receivables		10	-
Gain on sale of investment properties	4	(1,584)	-
Finance costs		15,203	19,428
Share of profit in joint ventures		(3,345)	(1,818)
Finance income		(4,802)	(4,591)
Cash from operations before working capital changes		64,980	102,231
Changes in working capital
Trading properties		(6,176)	2,664
Trading properties under development		(29,849)	4,084
Trade and other receivables		(30,217)	(147,045)
Trade payable, accruals and other liabilities		(28,177)	146,864
Net cash flows from operations		(29,439)	108,798
Employees' end of service indemnity paid		(797)	(319)
Net cash flows (used in)/from operating activities		(30,236)	108,479
INVESTING ACTIVITIES
Additions to property and equipment	3	(28,951)	(7,218)
Additions to investment properties		(2,153)	(18,011)
Interest received		2,390	9,559
Proceeds from sale of investment properties		17,814	-
Proceeds from disposal of investments		188	-
Net cash flows used in investing activities		(10,712)	(15,670)
FINANCING ACTIVITIES
Dividend paid		-	(6)
Board of Directors' remuneration paid		-	(8,000)
Acquisition of treasury shares, net		(967)	-
Loan repaid		(83,726)	(50,479)
Interest paid		(15,574)	(20,025)
Net cash flows used in financing activities		(100,267)	(78,510)
Net change in cash and cash equivalents		(141,215)	14,299
Cash and cash equivalents at the beginning of the period		235,503	115,889
Cash and cash equivalents at the end of the period	10	94,288	130,188

The accompanying notes 1 to 24 form an integral part of these interim condensed consolidated financial statements.

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RAK Properties P.J.S.C. and its Subsidiaries
Notes to the interim condensed consolidated financial statements For the three-month period ended 31 March 2026 (Unaudited)

1 Corporate information

RAK Properties P.J.S.C. (the "Company") is a public joint stock company established under Emiree Decree No. 5 issued by the Ruler of the Emirate of Ras Al Khaimah on 16 February 2005 and commenced its operations on 2 June 2005. The Company is listed in the Abu Dhabi Securities Exchange, United Arab Emirates (UAE).

The registered office of the Company is P.O. Box 31113, Ras Al Khaimah, UAE.

The interim condensed consolidated financial statements as at and for the three-month period ended 31 March 2026 comprises the Company and its Subsidiaries (collectively referred to as the "Group").

The principal activities of the Group are investment in and development of properties, property management, hotel operations, marina management, facility management and related services.

The interim condensed consolidated financial statements were authorised for issue on 12 May 2026 by the Board of Directors.

2 Basis of preparation

2.1 Statement of compliance

The interim condensed consolidated financial statements of the Group for the three-month period ended 31 March 2026 have been prepared in accordance with International Accounting Standard 34: Interim Financial Reporting.

The interim condensed consolidated financial statements do not contain all information and disclosures required for full consolidated financial statements prepared in accordance with IFRS Accounting Standards as issued by International Accounting Standards Board (IASB) and should be read in conjunction with the consolidated financial statements for the year end 31 December 2025. The same accounting policies, methods of computation, significant accounting judgments and estimates and assumptions are followed in these interim condensed consolidated financial statements as compared with the most recent annual consolidated financial statements, except for the new standards and amendments adopted during the current period as explained in Note 2.3.

The interim condensed consolidated financial statements have been prepared in Arab Emirates Dirham (AED), which is the Company's functional currency, and all values are rounded to the nearest thousand except where otherwise indicated. Each entity in the Group determines its own functional currency and items included in the financial statements of each entity are measured using that functional currency.

The interim condensed consolidated financial statements have been prepared on a historical cost basis, except for investment properties and investments, which are measured at fair value.

The preparation of interim condensed consolidated financial statements on the basis described above requires management to make judgements, estimates and assumptions that affect the application of policies and reported amounts of assets and liabilities, income and expenses. The estimates and associated assumptions are based on historical experience and various other factors that are believed to be reasonable under the circumstances, the results of which for the basis of making the judgements about carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates.

Results for the three-month period ended 31 March 2026 are not necessarily indicative of the results that may be expected for the financial year ending 31 December 2026.

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RAK Properties P.J.S.C. and its Subsidiaries
Notes to the interim condensed consolidated financial statements (continued)
For the three-month period ended 31 March 2026 (Unaudited)

2 Basis of preparation (continued)

2.1 Statement of compliance (continued)

The interim condensed consolidated financial statements comprise the financial statements of the Company and the entities controlled by the Company (its subsidiaries) as of 31 March 2026. Control is achieved where all the following criteria are met:

(a) the Company has power over an entity (i.e., existing rights that give it the current ability to direct the relevant activities of the investee);
(b) the Company has exposure, or rights, to variable returns from its involvement with the entity; and
(c) the Company has the ability to use its power over the entity to affect the amount of the Company’s returns.

When the Group has less than a majority of the voting or similar rights of an investee, the Group considers all relevant facts and circumstances in assessing whether it has power over an investee, including:

• The contractual arrangement with the other vote holders of the investee
• Rights arising from other contractual arrangements
• The Group’s voting rights and potential voting rights

The Group re-assesses whether or not it controls an investee if facts and circumstances indicate that there are changes to one or more of the three elements of control. Consolidation of a subsidiary begins when the Group obtains control over the subsidiary and ceases when the Group loses control of the subsidiary. Assets, liabilities, income and expenses of a subsidiary acquired or disposed of during the period are included in the interim condensed consolidated financial statements from the date the Group gains control until the date the Group ceases to control the subsidiary.

Subsidiaries

A subsidiary is fully consolidated from the date of acquisition or incorporation, being the date on which the Group obtains control, and continues to be consolidated until the date when such control ceases. The financial statements of the subsidiary are prepared for the same reporting period as the Company, using consistent accounting policies. All intra-group balances, transactions, unrealised gains and losses resulting from intra-group transactions and dividends are eliminated in full.

Details of the Company’s subsidiaries are as follows:

Subsidiaries	Country of incorporation	31 March 2026	31 December 2025
		Ownership %
1. RAK Properties International Limited	UAE	100%	100%
2. Intercontinental RAK Mina Al Arab Resorts & Spa L.L.C	UAE	100%	100%
3. Anantara Mina Al Arab Ras Al Khaimah Resorts L.L.C	UAE	100%	100%
4. Lagoon Marina Ship Management & Operation L.L.C	UAE	100%	100%
5. RAK Properties Tanzania Limited	Tanzania	100%	100%
6. Dolphin Marina Limited	Tanzania	100%	100%
7. RAK Properties Gayreimenkul Pazarlama Anonim Sirketi	Türkiye	100%	100%
8. MINA Management Supervision Services for Owners Associations LLC OPC	UAE	100%	100%
9. Angel Beach LLC OPC*	UAE	100%	-

• Angel Beach LLC OPC (tourism license TL-0398) was incorporated on 16 February 2026 and is principally engaged in restaurant and beverage activities and commenced operations during the period.

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RAK Properties P.J.S.C. and its Subsidiaries
Notes to the interim condensed consolidated financial statements (continued)
For the three-month period ended 31 March 2026 (Unaudited)

2 Basis of preparation (continued)

2.2 Significant accounting judgments, estimates and assumptions

The preparation of these interim condensed consolidated financial statements requires management to make judgments, estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, and the accompanying disclosures and the disclosure of contingent liabilities at the reporting date. Uncertainty about these assumptions and estimates could result in outcomes that require a material adjustment to the carrying amount of the assets or liabilities affected in future periods.

Judgements

In the process of applying the Group’s accounting policies, management has made the following judgements, which have the most significant effect on the amounts recognised in the interim condensed consolidated financial statements:

(i) Revenue from contracts with customers

The Group applied the following judgements that significantly affect the determination of the amount and timing of revenue from contracts with customers:

Determining the timing of revenue recognition on the sale of property

The Group has evaluated the timing of revenue recognition on the sale of property based on a careful analysis of the rights and obligations under the terms of the contract. The Group has concluded that contracts relating to the sale of completed property are recognised at a point in time when control transfers.

For contracts relating to the sale of property under development, the Group recognises the revenue over a period of time as the Group’s performance does not create an asset with alternative use. Furthermore, the Group has an enforceable right to payment for performance completed to date. It has considered the factors that indicate that it is restricted (contractually or practically) from readily directing the property under development for another use during its development. In addition, the Group is, at all times, entitled to an amount that at least compensates it for performances completed to date. In making this determination, the Group has carefully considered the contractual terms as well as local legislation.

The Group has determined that the input method is the best method for measuring progress for these contracts because there is a direct relationship between the costs incurred by the Group and the transfer of goods and services to the customer.

Principal versus agent considerations – services to tenants

The Group arranges for certain services provided to tenants of investment property included in the contract the Group enters into as a lessor. The Group has determined that it controls the services before they are transferred to tenants, because it has the ability to direct the use of these services and obtain the benefits from them. In making this determination, the Group has considered that it is primarily responsible for fulfilling the promise to provide these specified services because it directly deals with tenants’ complaints, and it is primarily responsible for the quality or suitability of the services. In addition, the Group has discretion in establishing the price that it charges to the tenants for the specified services.

Therefore, the Group has concluded that it is the principal in these contracts. In addition, the Group has concluded that it transfers control of these services over time, as services are rendered by the third-party service providers, because this is when tenants receive and, at the same time, consume the benefits from these services.

Consideration of material financing component in a contract

For contracts involving the sale of property, the Group is entitled to receive an initial deposit. The Group concluded that this is not considered a material financing component because it is for reasons other than the provision of financing to the Group. The initial deposits are used to protect the Group from the other party failing to adequately complete some or all of its obligations under the contract where customers do not have an established credit history.

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RAK Properties P.J.S.C. and its Subsidiaries
Notes to the interim condensed consolidated financial statements (continued)
For the three-month period ended 31 March 2026 (Unaudited)

2 Basis of preparation (continued)

2.2 Significant accounting judgments, estimates and assumptions (continued)

Judgements (continued)

(i) Revenue from contracts with customers (continued)

Cost to complete the projects

The Group estimates the cost to complete the projects in order to determine the cost attributable to revenue being recognised. These estimates include cost of design and consultancy, construction, potential claims by contractors as evaluated by the project consultant and the cost of meeting other contractual obligations to the customers.

(ii) Leases - Property lease classification – the Group as lessor

The Group has entered into commercial and residential property leases on its investment property portfolio. The Group has determined, based on an evaluation of the terms and conditions of the arrangements, such as the lease term not constituting a major part of the economic life of the commercial property and the present value of the minimum lease payments not amounting to substantially all of the fair value of the commercial property, that it retains substantially all the risks and rewards incidental to ownership of this property and accounts for the contracts as operating leases.

(iii) Classification of properties

In the process of classifying properties, management has made various judgments. Judgment is needed to determine whether a property qualifies as an investment property, property and equipment and/or trading property. The Group develops criteria so that it can exercise that judgment consistently in accordance with the definitions of investment property, property and equipment and trading properties. In making its judgment, management considered the detailed criteria and related guidance for the classification of properties as set out in IAS 2, IAS 16 and IAS 40, in particular, the intended usage of property as determined by the management. Trading properties are grouped under current assets, as intention of the management is to sell it within one year from the end of the reporting date.

Key sources of estimation uncertainty

The key assumptions concerning future and other key sources of estimation uncertainty at the reporting date, that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year, are described below. The Group based its assumptions and estimates on parameters available when the interim condensed consolidated financial statements were prepared. Existing circumstances and assumptions about future developments, however, may change due to market changes or circumstances arising that are beyond the control of the Group. Such changes are reflected in the assumptions when they occur.

(i) Valuation of investment properties

The fair value of investment properties is determined by independent real estate valuation experts using recognised valuation methods. These methods comprise the sales comparable method and discounted cash flow method. The discounted cash flow method requires the use of estimates such as future cash flows from assets (comprising of selling and leasing rates, future revenue streams, construction costs and associated professional fees, and financing cost, etc.), targeted internal rate of return and developer’s risk and targeted profit. These estimates are based on local market conditions existing at the end of the reporting period. Under the income capitalisation method, the income receivable under existing lease agreements and projected future rental streams are capitalised at appropriate rates to reflect the investment market conditions at the valuation dates. The Group’s undiscounted future cash flows analysis and the assessment of expected remaining holding period and income projections on the existing operating assets requires management to make material estimates and judgements related to future rental yields and capitalisation rates.

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RAK Properties P.J.S.C. and its Subsidiaries
Notes to the interim condensed consolidated financial statements (continued)
For the three-month period ended 31 March 2026 (Unaudited)

2 Basis of preparation (continued)

2.2 Significant accounting judgments, estimates and assumptions (continued)

Key sources of estimation uncertainty (continued)

(ii) Estimation of net realisable value for trading properties and trading properties under development

The Group’s management reviews the trading properties and trading properties under development to assess impairment, if there is an indication of impairment. In determining whether impairment losses should be recognised in the profit or loss, the management assesses the current selling prices of the property units and the anticipated costs for completion of such property units for properties which remain unsold at the reporting date. If the current selling prices are lower than the anticipated total cost at completion, an impairment provision is recognised for the identified loss event or condition to reduce the cost of development properties to its net realisable value.

(iii) Calculation of expected credit loss allowance

The Group assesses the impairment of its financial assets based on the ECL model. Under the expected credit loss model, the Group accounts for expected credit losses and changes in those expected credit losses at the end of each reporting period to reflect changes in credit risk since initial recognition of the financial assets. The Group measures the loss allowance at an amount equal to lifetime ECL for its financial instruments. When measuring ECL, the Group uses reasonable and supportable forward-looking information, which is based on assumptions for the future movement of different economic drivers and how these drivers will affect each other. Loss given default is an estimate of the loss arising on default. It is based on the difference between the contractual cash flows due and those that the lender would expect to receive, taking into account cash flows from collateral and integral credit enhancements. Probability of default constitutes a key input in measuring ECL. Probability of default is an estimate of the likelihood of default over a given time horizon, the calculation of which includes historical data, assumptions and expectations of future conditions.

(iv) Impairment of property and equipment and capital work in progress

The Group reviews its property and equipment and capital work in progress to assess impairment, if there is an indication of impairment. In determining whether impairment losses should be recognised in the profit or loss, the Group makes judgements as to whether there is any observable data indicating that there is a reduction in the carrying value of property and equipment or capital work in progress. Accordingly, provision for impairment is made where there is an identified loss event or condition which, based on previous experience, is evidence of a reduction in the carrying value of property and equipment or capital work in progress.

(v) Useful lives of property and equipment

The Group’s management determines the estimated useful lives of its property and equipment for calculating depreciation. This estimate is determined after considering the expected usage of the asset or physical wear and tear. Management reviews the residual value and useful lives annually and future depreciation charge would be adjusted where the management believes the useful lives differ from previous estimates.

(vi) Valuation of unquoted investments

Valuation of unquoted investments is normally based on one of the following:

• Recent arm’s length market transactions;
• The expected cash flows discounted at current rates applicable for the items and with similar terms and risk characteristics; or
• Other valuation models

The determination of the cash flows and discount factors for unquoted equity investments requires significant estimation. The Group calibrates the valuation techniques periodically and tests them for validity using either prices from observable current market transactions in the same instrument or from other available observable market data.

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RAK Properties P.J.S.C. and its Subsidiaries
Notes to the interim condensed consolidated financial statements (continued)
For the three-month period ended 31 March 2026 (Unaudited)

2 Basis of preparation (continued)

2.3 New or revised standards and interpretations

New standards, interpretations and amendments adopted by the Group

The accounting policies adopted in the preparation of the interim condensed consolidated financial statements are consistent with those followed in the preparation of the Group’s annual consolidated financial statements for the year ended 31 December 2025, except for the adoption of the following new standards and interpretations effective as of 1 January 2026.

• Amendments to the Classification and Measurement of Financial Instruments (Amendments to IFRS 7 and 9)
• Annual improvements to IFRS Accounting Standards - Volume 11

This amendment did not have a significant impact on these interim condensed consolidated financial statements. and therefore, the disclosures have not been made.

Standards, amendments and interpretations to existing Standards that are not yet effective and have not been adopted early by the Group

Other standards, amendments and interpretations that are not yet effective and have not been early adopted by the Group include:

• IFRS 19 Subsidiaries without Public Accountability: Disclosures and amendments
• IFRS 18 Presentation and Disclosures in Financial Statements
• Sale of contribution of Assets between an Investor and its Associates or Joint Ventures (Amendments to IFRS 10 and IAS 28)
• IFRS S1 General Requirements for Disclosure of Sustainability-related Financial Information and IFRS S2 Climate-related Disclosures (effective upon adoption by applicable regulatory authority)

IFRS 18 introduces new presentation and disclosure requirements of additional totals in the statement of profit or loss, a new note which discloses management-defined performance measures and enhancements to the requirements for aggregation and disaggregation. Management is still in the process of assessing the impact of the new standard, particularly with respect to the structure of the Group’s interim condensed consolidated financial statements. These remaining above standards, amendments and interpretations are not expected to have a significant impact on the interim condensed consolidated financial statements in the period of initial application and therefore no disclosures have been made.

3 Property and equipment

Additions, disposal and depreciation

During the three-month period ended 31 March 2026, the Group has made additions amounting to AED 28,951 thousand mainly related to construction of hospitality properties (three-month period ended 31 March 2025: AED 7,218 thousand).

Depreciation of property and equipment for the three-month period ended 31 March 2026 amounted to AED 17,814 thousand (three-month period ended 31 March 2025: AED 17,595 thousand).

12

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RAK Properties P.J.S.C. and its Subsidiaries
Notes to the interim condensed consolidated financial statements (continued)
For the three-month period ended 31 March 2026 (Unaudited)

4 Investment properties

| | 31 March
2026
AED '000
(Unaudited) | 31 December
2025
AED '000
(Audited) |
| --- | --- | --- |
| Buildings and plots of land | 1,372,391 | 1,394,967 |
| Investment properties under development | 13,797 | 11,644 |
| | 1,386,188 | 1,406,611 |

Investment property comprises parcels of land and number of residential and commercial properties that are leased to third parties. All investment properties are located in the UAE.

During the period, the Group disposed of investment properties with a carrying amount of AED 16,230 thousand (three-month period ended 31 March 2025: AED Nil), resulting in a gain on disposal of AED 1,584 thousand (three-month period ended 31 March 2025: AED Nil), which has been recognised in the statement of profit or loss.

Fair value

The management does not consider the fair value of investment properties for the period ended 31 March 2026 to be significantly different from the fair value as at 31 December 2025. The fair valuation of investment properties was conducted by an independent external valuer as at 31 December 2025. Management intends to appoint independent external valuer to determine the fair value as at 31 December 2026, unless there are indicators which suggest a significant change in the fair value before the reporting period.

Certain items of investment properties are mortgaged against bank borrowing.

5 Trading properties under development

| | 31 March
2026
AED '000
(Unaudited) | 31 December
2025
AED '000
(Audited) |
| --- | --- | --- |
| Inside UAE | 2,553,712 | 2,523,863 |
| Outside UAE | 13,815 | 13,815 |
| | 2,567,527 | 2,537,678 |
| Less: Classified as current assets | (290,623) | (245,714) |
| Classified as non-current assets | 2,276,904 | 2,291,964 |

6 Investments

| | 31 March
2026
AED '000
(Unaudited) | 31 December
2025
AED '000
(Audited) |
| --- | --- | --- |
| Investments at fair value through other comprehensive income | | |
| Investments within UAE | | |
| Unquoted equity investments | 1,002 | 1,190 |
| Investments outside UAE | | |
| Unquoted equity investments | 12,930 | 12,930 |
| Unquoted real estate funds | 3,320 | 3,320 |
| Total investments | 17,252 | 17,440 |

The details of valuation techniques and assumptions applied for the measurement of fair value of financial instruments are mentioned in Note 2.2 and Note 21 of the interim condensed consolidated financial statements.

13

---

RAK Properties P.J.S.C. and its Subsidiaries
Notes to the interim condensed consolidated financial statements (continued)
For the three-month period ended 31 March 2026 (Unaudited)

7 Investment in joint ventures

| | 31 March
2026
AED '000
(Unaudited) | 31 December
2025
AED '000
(Audited) |
| --- | --- | --- |
| Ellington Development FZ-LLC | 85,493 | 83,119 |
| Hive and Mina Real Estate Development LLC | 17,573 | 16,817 |
| One Facilities Management LLC | 215 | - |
| | 103,281 | 99,936 |

Ellington Properties Development LLC

The Group has entered into a joint venture agreement (“JVA”) and a Development Management Agreement (“DMA”), collectively referred to as “the Agreements”, with Ellington Properties Development LLC (“Ellington”).

Hive and Mina Real Estate Development LLC

During the year ended 31 December 2025, the Group entered into a joint venture agreement with ADC1 SPV LTD (“ADC1”) a wholly owned subsidiary of ARM Holdings LLC for the development of a project located on Hayat Island, Ras Al Khaimah.

One Facilities Management LLC

During the year ended 31 December 2025, the Group entered into a joint venture agreement with I F M Facilities Management LLC to establish One Facilities Management LLC.

8 Trade and other receivables

| | 31 March
2026
AED '000
(Unaudited) | 31 December
2025
AED '000
(Audited) |
| --- | --- | --- |
| Trade receivables | 680,152 | 616,577 |
| Contract assets | 1,172,943 | 1,214,856 |
| Trade receivables and contract assets, gross | 1,853,095 | 1,831,433 |
| Less: Allowance for expected credit losses | (36,122) | (36,112) |
| Trade receivables and contract assets, net | 1,816,973 | 1,795,321 |
| Other receivables (refer (ii)) | 60,361 | 43,546 |
| | 1,877,334 | 1,838,867 |
| Capitalised cost to obtain contract (refer (i)) | 246,773 | 250,186 |
| Advances to suppliers and contractors | 94,177 | 100,663 |
| VAT receivables | 21,793 | 11,095 |
| Prepayments | 5,494 | 7,529 |
| | 2,245,571 | 2,208,340 |
| Less: Non-current portion of trade and other receivables | (614,016) | (687,654) |
| | 1,631,555 | 1,520,686 |

(i) Costs incurred to obtain contracts with customers are amortised over the period of satisfying performance obligations, where applicable.
(ii) Other receivables include amount due from a related party AED 4,611 thousand (2025: 10,313 thousand) (Note 18).

14

---

RAK Properties P.J.S.C. and its Subsidiaries

Notes to the interim condensed consolidated financial statements (continued) For the three-month period ended 31 March 2026 (Unaudited)

9 Trading properties

| | 31 March
2026
AED '000
(Unaudited) | 31 December
2025
AED '000
(Audited) |
| --- | --- | --- |
| Trading properties - Inside UAE | 24,827 | 18,877 |
| Trading properties - Outside UAE | 12,370 | 12,370 |
| | 37,197 | 31,247 |
| Inventories – hospitality and facility management | 1,773 | 2,582 |
| | 38,970 | 33,829 |

10 Bank balances and cash

| | 31 March
2026
AED '000
(Unaudited) | 31 December
2025
AED '000
(Audited) |
| --- | --- | --- |
| Cash in hand | 480 | 260 |
| Bank balances: | | |
| - Current accounts | 46,359 | 98,764 |
| - Call accounts | 6,435 | 13,162 |
| - Current accounts – unclaimed dividends | 5,723 | 5,723 |
| - Term deposits | 500,000 | 400,000 |
| Balance at the end of the period/year | 558,997 | 517,909 |

Current accounts - unclaimed dividends will be utilised only for the payment of dividend and cannot be used for any other purposes.

The effective average interest rate on deposits is 3.4% to 4.4% per annum (2025: 4.3% to 5.1% per annum). Term deposits amounting to AED 500,000 thousand (2025: AED 400,000 thousand) are under lien against bank overdraft (Note 13). Bank balances and cash are maintained in UAE.

For the purpose of interim condensed consolidated statement of cash flows, cash and cash equivalents comprises of the following amounts:

| | 31 March
2026
AED '000
(Unaudited) | 31 March
2025
AED '000
(Audited) |
| --- | --- | --- |
| Bank balances and cash | 558,997 | 457,502 |
| Less: Current accounts – unclaimed dividends | (5,723) | (5,723) |
| Less: Bank overdraft | (458,986) | (321,591) |
| Cash and cash equivalents | 94,288 | 130,188 |

---

RAK Properties P.J.S.C. and its Subsidiaries
Notes to the interim condensed consolidated financial statements (continued)
For the three-month period ended 31 March 2026 (Unaudited)

11 Share capital and treasury shares

Share capital

| | 31 March 2026
AED '000
(Unaudited) | 31 December 2025
AED '000
(Audited) |
| --- | --- | --- |
| Authorised, issued and fully paid-up
3,000,000,000 shares of par value of AED 1 each | 3,000,000 | 3,000,000 |

Dividends

No dividend was approved in Annual General Meeting held on 15 March 2026 for the year ended 31 December 2025 (For the year ended 31 December 2024, no dividend was approved in Annual General Meeting held on 11 March 2025).

Treasury shares

As at 31 March 2026, 3,896 thousand treasury shares with a market value of AED 3,666 thousand were held (2025: 2,582 thousand treasury shares with a market value of AED 3,486 thousand).

12 Other reserves

| | 31 March 2026
AED '000
(Unaudited) | 31 December 2025
AED '000
(Audited) |
| --- | --- | --- |
| General reserve | 656,708 | 656,708 |
| Development reserve | 303,675 | 303,675 |
| Fair value reserve | (243,963) | (243,963) |
| Other reserve | 9,079 | 8,242 |
| | 725,499 | 724,662 |

13 Borrowings

| | 31 March 2026
AED '000
(Unaudited) | 31 December 2025
AED '000
(Audited) |
| --- | --- | --- |
| Term loans | 650,557 | 708,103 |
| Short term borrowing | - | 26,179 |
| Bank overdrafts | 458,986 | 276,683 |
| Total borrowings | 1,109,543 | 1,010,965 |
| Less: Current portion | (589,326) | (441,962) |
| Non-current portion | 520,217 | 569,003 |

The Group has obtained overdraft facilities of AED 900,000 thousand (31 December 2025: AED 700,000 thousand) from local commercial banks. Interest on bank overdrafts, which are secured by term deposits, ranges from 0.15% to 0.25% per annum over such term deposit rates (2025: 0.25% per annum). Further, for unsecured bank overdrafts, interest is computed at a fixed margin plus 1 to 3 months EIBOR per annum.

16

---

RAK Properties P.J.S.C. and its Subsidiaries
Notes to the interim condensed consolidated financial statements (continued)
For the three-month period ended 31 March 2026 (Unaudited)

13 Borrowings (continued)

The overdraft facilities of the Group are secured by:

• Lien over fixed deposit for AED 500,000 thousand (Note 10);
• To route funds 1.5 times of the net clean limit utilised under the overdraft.

The details of the long-term bank loans, including terms of repayment, and interest rate are set out in the consolidated financial statements of the Group for the year ended 31 December 2025.

The bank borrowing agreements (“Agreements”) contain certain restrictive covenants including maintaining Debt to EBITDA ratio. The Group complied with the annual bank covenants as at 31 December 2025.

Term loans are secured against the following:

• Legal mortgage of land and buildings of specific properties included in property and equipment, investment properties, trading properties under development and trading properties.
• Assignment of insurance over the mortgaged properties in favour of the bank.
• Assignment of guarantees from the main contractor/construction contracts under the project duly assigned in favour of the bank.
• Assignment of revenues from the hotel projects financed by the banks.
• Assignment of revenues from sale of apartments and rental revenues from the apartments financed by the bank.
• Pledge of project account opened with the bank for receiving the project receipts from buyers.

14 Trade payable, accruals and other liabilities

| | 31 March
2026
AED '000
(Unaudited) | 31 December
2025
AED '000
(Audited) |
| --- | --- | --- |
| Trade payables | 225,595 | 207,095 |
| Contract liabilities | 551,105 | 443,171 |
| Other payables and accruals | 221,138 | 271,028 |
| Advance connection charges | 170,691 | 175,769 |
| Project contract accruals | 164,194 | 260,632 |
| Unclaimed dividends | 5,723 | 5,723 |
| | 1,338,446 | 1,363,418 |
| Less: Current portion | (534,514) | (663,104) |
| Non-current portion | 803,932 | 700,314 |

Contract liabilities include amount due to a related party AED 1,368 thousand (2025: 2,196 thousand) (Note 18).

17

---

RAK Properties P.J.S.C. and its Subsidiaries

Notes to the interim condensed consolidated financial statements (continued)
For the three-month period ended 31 March 2026 (Unaudited)

15 Revenue and cost of revenue

Three-month period ended
	31 March
2026
AED '000
(Unaudited)	31 March
2025
AED '000
(Unaudited)
Type of revenue with customers
Sale of properties	210,594	297,534
Hospitality operations	55,053	54,737
Property leasing and others	12,338	18,000
Total revenue	277,985	370,271
Cost of revenue
Cost of sale of properties	140,765	198,250
Hospitality operations	21,036	21,389
Property leasing and others	3,458	7,755
Amortisation of government grants	(2,622)	(3,712)
	162,637	223,682

The Group earned its entire revenue from contracts within the United Arab Emirates.

Below is the split of revenue recognised over a period of time and at a point in time:

Three-month period ended
	31 March
2026
AED '000
(Unaudited)	31 March
2025
AED '000
(Unaudited)
Recognised over time	257,647	331,645
Recognised at a point in time	13,237	29,858
Total revenue from contracts with customers	270,884	361,503
Leasing income – recognised over term of lease	7,101	8,768
Total revenue	277,985	370,271

---

RAK Properties P.J.S.C. and its Subsidiaries
Notes to the interim condensed consolidated financial statements (continued)
For the three-month period ended 31 March 2026 (Unaudited)

16 Selling, general and administrative expenses

Three-month period ended
	31 March
2026
AED '000
(Unaudited)	31 March
2025
AED '000
(Unaudited)
Staff costs	23,161	17,770
Depreciation	17,814	17,595
Sales and marketing expenses	17,705	12,979
Other expenses	14,841	12,646
	73,521	60,990

17 Income tax

The Group has calculated their income tax liability in accordance with Federal Decree-Law No 47 of 2022 on the Taxation of Corporations and Businesses, Corporate Tax Law (“CT Law”).

(a) The income tax expense recognised in the interim condensed consolidated income statement comprises the following:

Three-month period ended
	31 March
2026
AED'000
(Unaudited)	31 March
2025
AED'000
(Unaudited)
Income tax
Current income tax expense	3,624	6,559
Total income tax expense	3,624	6,559

(b) Reconciliation of income tax expense:

Three-month period ended
	31 March
2026
AED'000
(Unaudited)	31 March
2025
AED'000
(Unaudited)
Net profit for the period before tax	43,715	74,465
Tax at the tax rate of 9%	3,934	6,702
Tax effects of
Share of profit from a joint venture	(301)	(164)
Expenses not deductible for tax purposes - net	-	30
Taxable income not exceeding threshold	(9)	(9)
Total income tax expense	3,624	6,559

19

---

RAK Properties P.J.S.C. and its Subsidiaries
Notes to the interim condensed consolidated financial statements (continued)
For the three-month period ended 31 March 2026 (Unaudited)

18 Related party disclosures

The Group, in the ordinary course of business, enters into transactions, at agreed terms and conditions, with other business enterprises or individuals that fall within the definition of related parties contained in IAS 24, “Related Party Disclosures”. These transactions are carried out at arm’s length basis.

The following are the significant related party transactions during the period are as below:

	Three-month period ended
	31 March 2026
AED’000
(Unaudited)	31 March 2025
AED’000
(Unaudited)
Key management personnel of the Group
Sitting fee paid to Directors	111	81
Compensation of key management personnel:
Salaries and benefits	10,949	4,832
End of service benefits	125	132

The Board of Directors remuneration amounting to AED 8,000 thousand for the year ended 31 December 2025 was approved by the Shareholders in the Annual General Meeting on 15 March 2026.

Balances with related parties included in the condensed consolidated financial statements are as follows:

| | 31 March 2026
AED ’000
(Unaudited) | 31 December 2025
AED ’000
(Audited) |
| --- | --- | --- |
| Due from a related party – other receivables (Note 8) | 4,611 | 10,313 |
| Due to a related party – contract liabilities (Note 14) | 1,368 | 2,196 |

Outstanding balances arise in the normal course of business, are unsecured, interest-free and settlement occurs generally in cash.

19 Basic and diluted earnings per share

	Three-month period ended
	31 March 2026
(Unaudited)	31 March 2025
(Unaudited)
Basic earnings per share
Net profit for the period (AED’000)	40,091	67,906
Issued ordinary shares outstanding at 1 January (in thousands)	3,000,000	3,000,000
Treasury shares held on behalf of the Company	(2,582)	(17,917)
Issued ordinary shares outstanding at 1 January (in thousands)	2,997,418	2,982,083
Treasury shares movement - net (in thousands)	(336)	-
Weighted average number of shares outstanding at 31 March (in thousands)	2,997,082	2,982,083
Basic and diluted earnings per share (AED)	0.013	0.023

There were no potentially dilutive shares as at 31 March 2026 and 31 March 2025.

20

---

RAK Properties P.J.S.C. and its Subsidiaries
Notes to the interim condensed consolidated financial statements (continued)
For the three-month period ended 31 March 2026 (Unaudited)

20 Contingent liabilities and commitments

Contingent liabilities and commitments relating to the property development are as follows:

| | 31 March 2026
AED '000
(Unaudited) | 31 December 2025
AED '000
(Audited) |
| --- | --- | --- |
| Commitments | | |
| Approved and contracted | 905,531 | 1,044,963 |
| Contingent liability | | |
| Letter of credit | 10,542 | - |

The above commitments represent the value of contracts entered into by the Group including contracts entered for construction of properties, net of invoices received, and accruals made at that date.

21 Fair values of financial instruments

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. As such, differences can arise between book values and the fair value estimates. Underlying the definition of fair value is the presumption that the Group is a going concern without any intention or requirement to materially curtail the scale of its operation or to undertake a transaction on adverse terms.

Fair value of financial instruments carried at amortised cost

Management considers that the carrying amounts of financial assets and financial liabilities recognised at amortised cost in the condensed consolidated financial information approximate their fair values.

Valuation techniques and assumptions applied for the purposes of measuring fair value.

The fair values of financial and non-financial assets and financial liabilities are determined using similar valuation techniques and assumptions as used in the audited annual consolidated financial statements for the year ended 31 December 2025.

Fair value measurements recognised in the interim condensed consolidated statement of financial position.

The following table provides an analysis of financial and non-financial instruments that are measured subsequent to initial recognition at fair value, grouped into Levels 1 to 3 based on the degree to which the fair value is observable:

• Level 1 fair value measurements are those derived from quoted prices (unadjusted) in active markets for identical assets or liabilities;
• Level 2 fair value measurements are those derived from inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices); and
• Level 3 fair value measurements are those derived from valuation techniques that include inputs for the asset or liability that are not based on observable market data (unobservable inputs).

| | Level 1
AED '000 | Level 2
AED '000 | Level 3
AED '000 | Total
AED '000 |
| --- | --- | --- | --- | --- |
| 31 March 2026 (Unaudited) | | | | |
| Fair value through OCI –
unquoted equities and funds | - | - | 17,252 | 17,252 |
| Investment properties | - | - | 1,386,188 | 1,386,188 |
| | - | - | 1,403,440 | 1,403,440 |

21

---

RAK Properties P.J.S.C. and its Subsidiaries
Notes to the interim condensed consolidated financial statements (continued)
For the three-month period ended 31 March 2026 (Unaudited)

21 Fair values of financial instruments (continued)

| | Level 1
AED '000 | Level 2
AED '000 | Level 3
AED '000 | Total
AED '000 |
| --- | --- | --- | --- | --- |
| 31 December 2025 (Audited) | | | | |
| Fair value through OCI –
unquoted equities and funds | - | - | 17,440 | 17,440 |
| Investment properties | - | - | 1,406,611 | 1,406,611 |
| | - | - | 1,424,051 | 1,424,051 |

During the current and previous periods, there were no transfers between Level 1 and Level 2 fair value measurements, and no transfers into or out of Level 3 fair value measurements.

22 Segment reporting

Management has determined the operating segments based on segments identified for the purpose of allocating resources and assessing performance. The Group is organised into three major operating segments: property sales, hospitality operations, property leasing and others. Information regarding the operations of each separate segment is included below:

| | Sales of
Properties
AED '000 | Hospitality
operations
AED '000 | Property
leasing
and others
AED '000 | Total
AED '000 |
| --- | --- | --- | --- | --- |
| Three-month period ended
31 March 2026 (Unaudited) | | | | |
| Revenue | 213,099 | 55,053 | 9,833 | 277,985 |
| Segment gross profit | 74,957 | 34,017 | 6,374 | 115,348 |
| As at 31 March 2026
(Unaudited) | | | | |
| Total assets | 4,825,557 | 1,541,793 | 2,452,344 | 8,819,694 |
| Total liabilities | 1,276,298 | 515,006 | 1,047,296 | 2,838,600 |
| Capital expenditure | - | 24,598 | 3,898 | 28,496 |
| | Sales of
Properties
AED '000 | Hospitality
operations
AED '000 | Property
leasing
and others
AED '000 | Total
AED '000 |
| Three-month period ended
31 March 2025 (Unaudited) | | | | |
| Revenue | 298,257 | 54,737 | 17,277 | 370,271 |
| Segment gross profit | 103,719 | 33,348 | 9,522 | 146,589 |
| As at 31 December 2025 (Audited) | | | | |
| Total assets | 4,761,878 | 1,538,075 | 2,406,215 | 8,706,168 |
| Total liabilities | 1,293,492 | 558,182 | 912,524 | 2,764,198 |
| Capital expenditure | - | 31,524 | 73,234 | 104,758 |

22

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23

RAK Properties P.J.S.C. and its Subsidiaries

Notes to the interim condensed consolidated financial statements (continued)
For the three-month period ended 31 March 2026 (Unaudited)

23 Significant events during the period

During the period, geopolitical tensions in the Middle East have continued to evolve, including ongoing regional conflicts and heightened political uncertainty. These developments have increased volatility in global and regional financial markets and may, over time, affect economic conditions in the region. As at the date of approval of these interim condensed consolidated financial statements, the Group continues to monitor developments in the region and will assess the potential impact, if any.

24 Subsequent events

On 13 April 2026, the Group entered into a term financing arrangement with financial institutions to secure additional borrowing facility with total limit of AED 2,000,000 thousand. The facility would be partially utilized for the settlement of the existing term loans obtained in the previous year for the construction of hotel properties.