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23 May 2024

Emaar earns 2012 profit of Dh2.119 billion

By Staff

Backed by investor confidence in Dubai’s property sector and strong growth in recurring revenues from its shopping malls and retail, hospitality and leisure businesses, Emaar Properties PJSC recorded full-year 2012 net profits of Dh2.119 billion ($577 million),  18 per cent higher than the full-year 2011 net profit of Dh1.794 billion ($488 million).

Annual revenues for 2012 reached Dh8.240 billion ($2.243 billion), slightly higher than the 2011 revenues of Dh8.112 billion ($ 2.209 billion).

Reflecting the success of the company’s focus on strengthening its recurring revenue streams, Emaar’s shopping malls and retail and hospitality and leisure businesses contributed Dh4.096 billion ($1.115 billion) to the full-year revenue, representing 50 per cent of the total.

The contribution of Emaar’s international operations to the total revenue was Dh1.264 billion ($344 million), representing 15 per cent of the total revenue. International revenues were reinforced by the handover of homes and offices in Turkey, Lebanon, Saudi Arabia, Egypt and Pakistan, among other markets.

The fourth quarter (October to December) 2012 revenues reached Dh2.680 billion ($730 million), 64 per cent more than the third-quarter (July to September) 2012 revenues of Dh1.639 billion ($446 million). Net profit for the last quarter of 2012 was Dh512 million ($139 million), 32 per cent higher than the third-quarter 2012 net profit of Dh387 million ($105 million).

Mohamed Alabbar, Chairman of Emaar Properties, said: “Last year was one of transformation for Emaar Properties, Dubai and a number of the international markets that we serve. With Dubai restating its credentials as a global business and tourism hub, Emaar capitalised on the city’s resurgence by investing in creating prime real estate assets and strengthening our shopping malls and hospitality businesses. Our inspiration has been and continues to be the vision of His Highness Sheikh Mohammed bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE and Ruler of Dubai, which emphasises the continued expansion of the core sectors of tourism, retail and hospitality.”

“We have made several significant additions to our property portfolio including the Dubai Modern Art Museum & Opera House District in Downtown Dubai, the 1 million sq ft expansion to The Dubai Mall, the extension to Arabian Ranches, new properties in our Address hotels portfolio, and our partnership with Mohammed bin Rashid City. Our focus on adding value for our stakeholders and creating self-sustaining business entities that contribute to the recurring revenue streams of the company will remain a constant,” Alabbar said.

Increase in recurring revenues

In 2012, Emaar’s shopping malls & retail business contributed Dh2.719 billion ($740 million) to annual revenues, 27 per cent higher than the 2011 malls and retail revenues of Dh2.14 billion ($583 million). This was led by the strong growth in visitor footfall to The Dubai Mall, Emaar’s flagship development, which welcomed over 60 million visitors in 2012 – a growth of over 11 per cent compared to 2011.

Emaar’s hospitality and leisure business revenues for 2012 stood at Dh1.377 billion ($375 million), 13 per cent higher than the 2011 revenue of Dh1.22 billion ($332 million). The Address Hotels + Resorts recorded an average annual occupancy of 85 per cent in 2012, and the chain strengthened its international footprint with management contracts to operate luxury resorts in Egypt and Kenya.

Strong project portfolio

During the past year, Emaar handed over 1,105 homes and more than 149,000 square feet of commercial office space in Dubai. The company also handed over 673 homes and more than 122,000 square feet of commercial space in its international markets in 2012.

Emaar launched several premier projects including Panorama at The Views, The Address The BLVD in Downtown Dubai, and luxury villas and town houses in Arabian Ranches last year. More than 80 per cent of the projects launched last year have been sold.

Growing international footprint

Among the international projects launched by Emaar in 2012 was Emaar Square in Turkey, which will feature over 1,000 luxury homes, a 180-room five-star hotel, offices, and a world-class shopping mall, the largest in the country. Emaar also launched the ‘city within a city’ development, Emaar Square, at its Uptown Cairo development in Egypt.

Firm fundamentals

With total assets of over Dh61.2 billion ($16.7 billion) as at 30 September 2012, Emaar has an impressive land bank of more than 234 million sq m in international markets, and over 11.19 million sq m in current gross construction area in the UAE.

In 2012, Emaar priced its second international fixed-income sukuk offering, raising $500 million via the issuance of trust certificates, which was listed on Nasdaq Dubai. The company also signed a financing facility amounting to $500 million with a consortium of banks to develop Emaar Square in Turkey.

Economic impact

Among the most significant achievements of Emaar in 2012 was establishing Downtown Dubai, its $20 billion flagship mega-development, as the world’s most visited tourism, shopping and lifestyle destination. In addition to creating several thousand new jobs, Downtown Dubai and its varied attractions contributed significantly to Dubai’s tourism, hospitality and retail sectors.

Downtown Dubai was also in the global spotlight by hosting over 1.7 million visitors for the New Year’s Eve Gala, which was telecast live to over 2 billion people.