Dubai: Parkin records 26% jump in fines issued during second quarter this year

The majority of the fines issued were a result of public parking enforcement

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Published: Mon 12 Aug 2024, 9:54 AM

Last updated: Mon 12 Aug 2024, 9:16 PM

The total number of fines issued in Dubai increased by 26 per cent from 291,000 in Q2 2023 to 365,000 in Q2 2024, with a fine collection rate of 87 per cent during the quarter, according to Parkin Company. The firm revealed on Monday that the majority of the fines issued were a result of public parking enforcement.

Revenue generated from fines increased by 27 per cent to Dh54.6 million in Q2 2024, driven by a higher number of customers, transactions and an enhanced enforcement framework by a pool of smart inspection scan cars, the company said in a statement on Monday.

The expansion of enforcement coverage into new areas, alongside various optimisation initiatives, allowed the company to more efficiently and accurately impose more fines. Total fines revenue generated from scan cars more than doubled year on year in the second quarter, representing around 40 per cent of total enforcement revenue. Total fines revenue increased by 13 per cent to Dh107.1 million during January-June 2024.

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“Parkin continued to enhance its enforcement capabilities via the use of its fleet of smart inspection scan cars. These vehicles have expanded the Company’s ability to undertake enforcement across new areas and with higher accuracy, reducing reliance on physical inspections.

"In addition to the overall increase in the number of customers and transactions, initiatives such as optimisation of scan routes, improvements to shift patterns and a change in the way permits are verified without the need for time-consuming manual checks, contributed to the total number of fines generated by scan cars more than doubling in Q2 2024 versus Q2 2023,” it said in a statement on Monday.

Parking spaces cross 200,000 mark

The total number of paid parking spaces in Dubai crossed the 200,000 mark in the second quarter of 2024, according to Parkin Company.

The company saw an increase of 3 per cent in paid parking spaces, taking the total to 200,400 across the emirate.

It also added around 2,900 new parking spaces during the second quarter of this year, taking the total to 177,000 in Dubai. This includes paid public parking only.

The company revealed in its second quarterly results that around 3,000 developer-owned parking spaces were also added, totalling to 20,200. Meanwhile, multi-storey car parking decreased to 3,200.

Hiring in 2024

Parkin’s employee benefits expense decreased by 29 per cent to Dh25.5 million in Q2 2024. In Q2 2023, the RTA’s cost centre allocation was based on around 450 employees whereas Parkin’s headcount stood at 311 as of the end of Q2 2024. However, it said that employee benefits expense is expected to increase in the coming quarters due to ongoing hiring and the re-alignment of salaries from RTA to Parkin contracts from Q2 2024 onwards. Employee benefits expense decreased by 39 per cent to Dh43.9 million in H1 2024.

Parkin added that it would continue to grow its headcount throughout the remainder of the year as it looks to build up its internal capabilities, resulting in higher staff costs in the second half of 2024.

Net profit

The company’s net profit increased 7 per cent to Dh95.0 million in Q2 2024 net profit for the first half of 2024 was up 6 per cent to Dh198.8 million.

EBITDA increased 42 per cent in Q2 2024 to Dh134.0 million, representing an EBITDA margin of 65 per cent, up 14 percentage points on Q2 2023. The margin expansion was driven by its growing platform, enabling scale efficiencies and continued digitalisation across the Company’s operations. In H1 2024, EBITDA increased 37 per cent to Dh272.3 million.

Total revenue increased by 12 per cent to Dh205.5 million in Q2 2024, driven by an increase in revenue generated by public and developer parking, seasonal permits and fines. The uptick in revenues is despite a slightly lower number of chargeable days in the period and the impact of the unprecedented record rainfall for a period of 3 days during mid-April.

The company intends to pay a semi-annual dividend in April and October, with the first payment expected in October 2024 in respect of H1 2024.

At the end of the second quarter, Parkin’s net debt position was Dh846.6 million. Including the Murabaha revolving credit facility, which remains fully undrawn, the company has available liquidity of Dh357.1 million. The increase in liquidity is attributed to the collection of receivables undertaken during the second quarter.

Ahmed Bahrozyan, chairman of Parkin Company, said second-quarter results highlight continued momentum in the core business of public parking and clear execution of key initiatives as part of the growth strategy. “As Dubai’s population and economy continue to grow and prosper, Parkin will continue to play a key role in supporting the ambitious expansion plans of the Emirate, while seeking to deliver long-term, sustainable, shareholder value.”

Mohamed Al Ali, CEO of Parkin, added that second-quarter profitable growth was underpinned by higher transaction volumes in public and developer parking segments, greater demand for seasonal permits, improved public parking utilisation rates and enhanced enforcement practices.

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