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19 March 2024

Jafza profit halves to Dh139.7m

Jafza's total impairments stood at Dh247 million (FILE)

Published
By Reuters

Full-year profit at Jebel Ali Free Zone (Jafza), a unit of state-owned conglomerate Dubai World more than halved, and the firm said it was eyeing options to refinance an Islamic bond due in 2012.

In a statement accompanying its financial results, Jafza's chairman said the company was considering refinancing options for its Dh7.5 billion ($2.04 billion) Islamic bond, or sukuk, its only outstanding debt.

"The establishment commenced work on the liability management and is currently exploring various refinancing options," Chairman Hisham Abdullah Al Shirawi said in a statement, referring to the sukuk.

The dirham-denominated sukuk is not guaranteed by the government of Dubai and bondholders are predominately local banks.

Jafza made a profit of Dh139.7 million ($38.04 million) in 2010, its financial statements showed, compared with Dh286.7 million in the previous year.

Impairments of investment properties hit Dh198.3 million, weighing on profitability, against Dh28.4 million in 2009, the statement said.

Total impairments stood at Dh247 million.

Yields on Dubai names, including the Jafza sukuk, have narrowed in the last few weeks, with growing buying interest in the bond. One Dubai-based fixed income trader said the market has already priced in the refinancing of the sukuk.