Emaar Q1 net profit at Dh421 million

Emaar Properties first quarter net profit fell 45 per cent to Dh421 million compared to Dh760 million during the same period last year.
 
Revenue during the period stood at Dh1.98 billion as against Dh2.87 billion, recording a 31 per cent decline, according to the company statement. Losses from associate companies, which includes Amlak Finance, were Dh127 million for the first-quarter.
 
Net profit rose on a quarter-on-quarter basis, jumping 54 per cent. The developer had made a provision of Dh417 million in the fourth quarter 2010.
 
First quarter results were supported by the continued delivery of residential units in Burj Khalifa and the handover of commercial offices in The Eighth Gate, Syria, an integrated project. It also commenced delivery of Boulevard Plaza within Downtown Dubai during this quarter.
 
Emaar handed over approximately 270 units during the quarter as compared to over 1,300 and 1,000 units during the first and fourth quarters of 2010, respectively. However, due to higher margins recorded on the deliveries and the hospitality and malls businesses, the gross margins increased significantly as compared to first and fourth quarters of 2010. This resulted in the gross profit being at similar levels to the compared quarters of last year.
 
Emaar’s business subsidiaries contributed to the company’s revenue stream with the shopping malls and retail business demonstrating strong growth trends.
 
The Dubai Mall reported first quarter footfall of 13.5 million visitors – the highest-ever quarterly performance since its opening in November 2008.
 
Emaar Hospitality Group, the hospitality and leisure subsidiary, recorded positive growth with Address Hotels + Resorts, recording an average occupancy of 87 per cent in the first quarter.
 
Mohamed Alabbar, Chairman, Emaar Properties, said the first quarter performance underlines the company’s strategy to focus on project delivery and strengthening recurring revenue streams from its shopping mall and hospitality businesses.
 
He added: “Emaar will continue to explore growth opportunities in key emerging markets, where our emphasis will be to create dynamic socio-economic growth engines like Downtown Dubai that create jobs, support ancillary industries and meet lifestyle aspirations.”
 
In international markets, Emaar is fast progressing on a range of projects that will be delivered in the coming months. These include Jeddah Gate and Al Khobar Lakes in Saudi Arabia by Emaar Middle East; and Uptown Cairo and Marassi in Egypt. Other countries where Emaar’s operations will further contribute to its revenue streams this year include Jordan, India, Pakistan and Turkey.
 
The company’s share closed 1.43 per cent down at Dh3.44 on the Dubai Financial Market on Sunday.

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