Dubai real estate recovery: Nakheel reports 36% rise in Q1 profits

Dubai-based Nakheel has reported an increase of 36 per cent in its net profits to Dh491 million in first quarter 2013, compared with Dh362 million in the same period last year.

The increase in profit was primarily due to new unit handovers and growth in retail segment.

The company said revenues increased by 62 per cent to Dh2.19 billion compared to Dh1.35 billion in the same period last year.

It has delivered around 5,400 homes, including around 770 in the first quarter to customers since completing its restructuring in late 2011.

Handovers were mainly in Palm Jumeirah, Al Furjan, International City, Jumeirah Village, Jumeirah Park and Jumeirah Heights communities.

Nakheel, which continues to complete its near term projects, aims to deliver nearly 3,000 units this year.

Company Chairman Ali Rashid Lootah, said: “Our robust results for Q1 speak for themselves. Not only do they highlight the ongoing support of the Government of Dubai and our commitment to delivering our post restructuring plan, they also clearly reflect the continual recovery of Dubai’s real estate market and solid investor confidence in Nakheel and its projects

He added: “Q1 has been a hive of activity for Nakheel, with continued delivery to customers and ongoing construction of a growing number of residential and retail projects. We remain focused on implementing our sustainable, realistic long term business strategy, which is fundamental to the growth of Dubai’s real estate sector.”

Retail, leasing and leisure segments also contributed positively to the quarterly result.

The company has already launched Nakheel Mall and The Pointe at Palm Jumeirah and extension of Ibn Battuta Mall. Several other residential and retail projects, including Palma Residences, Palm Views, Jumeirah Park, Dragon Mart Phase 2 and community centres at Discovery Gardens and Jumeirah Park, are under construction.

Nakheel says it was currently evaluating a number of additional projects that will add value to its existing communities.

By the end of Q1 2013, the company paid interest payments of Dh206 million to bank lenders and issued the fourth tranche of its trade creditor sukuk worth Dh120 million.

The company, since restructuring, has paid over Dh1.1 billion in loan interest and sukuk profit payments, while cash payments of around Dh11 billion have been made to trade creditors and contractors.

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