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Emaar to list UAE business, reports 15% growth in H1 net profits to Dh2.8 bn


Dubai-based Emaar Properties, developer of the world’s tallest tower Burj Khalifa, said, it recorded a 15 per cent growth in net profit to Dh2.83 billion (US$772 million) during the first six months (January to June) of 2017 (H1 2017), compared to Dh2.47 billion (US$674 million) during the same period last year. Revenue for the first half of the year grew 8 per cent to Dh7.86 billion (US$2.14 billion) over H1 2016 revenue of Dh7.257 billion (US$1.97 billion).

Recurring revenue from Emaar’s shopping malls, retail, hospitality, leisure, commercial leasing and entertainment businesses in H1 2017 is Dh3.01 billion (US$821 million), which represents 38 per cent of the total revenue.

Emaar’s revenue from its international development recorded a growth of 64 per cent in H1 2017 to Dh1.69 billion (US$462 million), compared to the H1 2016 international revenue of Dh1.032 billion (US$281 million). This was underpinned by significant progress in projects achieved in key markets including Egypt, Turkey, India and Saudi Arabia, among others. Emaar’s international development now contribute 22 per cent to the total Group revenue.

In the second quarter (April to June) of 2017 (Q2 2017), Emaar recorded a net profit of Dh1.45 billion (US$396 million), an increase of 14 per cent over Q2 2016 net profit of Dh1.27 billion (US$346 million).

Mohamed Alabbar, Chairman of Emaar Properties, said the positive performance builds on Emaar’s ongoing focus on project delivery and being a customer-centric organisation. “Organisation-wide, we are marking a transformational change to strengthen project management and service excellence led by digital technology. At every stage of development, we place emphasis on being more efficient and responsive to the aspirations of our customers, and to create long-term value for our stakeholders.

“As a year-round tourism and retail destination, and with a focus on infrastructure development, the UAE has evolved as a global business and leisure hub, and through our projects, we are contributing to the nation in driving sustained economic growth.”

Emaar’s commitment to value creation for shareholders was highlighted by the company distributing a cash dividend of 15 per cent of the share capital, equivalent to Dh1.07 billion (US$292 million).

To provide superior value to all Emaar’s shareholders for their unwavering support to the company since 1997, Emaar has announced its plan to list its UAE Real Estate development business through up to 30 per cent share offering on the Dubai Financial Market (DFM).

The funds raised through the sale of equity will be primarily distributed as dividends to shareholders. This will ensure that the value of this business is properly recognised, thereby enhancing value for Emaar shareholders.

During the first six months of 2017, Emaar recorded property sales in Dubai of Dh10.81 billion (US$2.94 billion), 22 per cent higher than Dh8.9 billion (US$2.42 billion) during the same period in 2016, underlining the significant customer interest in Emaar’s projects.  

This growth was led by residential launches in Emaar’s flagship projects including Dubai Creek Harbour, Downtown Dubai, Dubai Hills Estate and Emaar South – the smart city hubs of the future. The new residential project launches in the first six months of the year included: Downtown Views II and Vida Dubai Mall in Downtown Dubai, Vida Residences in Dubai Marina, Creek Gate, Harbour Gate and Creek Rise in Dubai Creek Harbour, Park Heights I & II and Maple 3 in Dubai Hills Estate and Golf Views apartments and Urbana III stacked townhouses in Emaar South.

A highlight of Emaar’s property development portfolio was the completion of foundation work for the Dubai Creek Harbour Tower. More than 145 barrette piles have been laid to depths of over 72 metres to secure the super-tall structure. Emaar also achieved the challenging engineering feat of designing, constructing and lifting an iconic Sky Bridge that links the new Address Sky View hotel with the Address Residences Sky View in Downtown Dubai.

With robust sales in Dubai, Emaar now has a total backlog of Dh49.5 billion (US$13.5 billion) including a backlog of over Dh40 billion (US$10.9 billion) in Dubai, to be recognised in the next few years, a testament to the company’s strong financial fundamentals.

Emaar Malls, the shopping malls and retail business majority-owned by Emaar Properties, reported H1 2017 net profit of Dh1.02 billion (US$27 million), 3 per cent higher than H1 2016 net profit of Dh987 million (US$269 million). Emaar Malls revenue in H1 2017 is Dh1.62 billion (US$442 million), similar to H1 2016 revenue of Dh1.61 billion (US$441 million).

As part of the digital transformation initiatives, Emaar Malls acquired a 51 per cent stake in Namshi, the leading online fashion retailer in the Middle east. This complements its focus on multi-channel retailing, and creating long-term value for its stakeholders. At its second Annual General Meeting in April, Emaar Malls distributed 10 per cent of the share capital, equivalent to Dh1.30 billion (US$354 million) as cash dividend to the shareholders.

The shopping mall assets of Emaar Malls welcomed over 65 million visitors in the first half of 2017, an increase of 7 per cent over H1 2016.

The hospitality and leisure, commercial leasing and entertainment businesses of Emaar recorded H1 2017 revenue of Dh1.39 billion (US$388 million), which is 7 per cent higher than the H1 2016 revenue of Dh1.29 billion (US$353 million).

Emaar further strengthened its hospitality portfolio in the first half of the year with the opening of three properties – Address Boulevard in Downtown Dubai, Rove Healthcare City and Rove Trade Centre. Occupancy levels at Address Hotel + Resorts were 82 per cent, higher than industry average. The hospitality business has also expanded its geographic footprint with management agreements to operate hotels in Saudi Arabia, Bahrain, Egypt and Turkey. Today, the Group has over 27 upcoming projects in the pipeline in the UAE and in international markets.

In Q2 2017, Emaar Turkey opened Emaar Square Mall, a world-class retail and leisure destination located in the heart of Emaar Square in Istanbul, an elegant master-planned development, showcasing some of the world’s leading retail, entertainment and gastronomy brands to assure visitors a memorable experience.

One of the world’s largest real estate companies, Emaar has a land bank of about 188 million square metres in the UAE and key international markets. With a proven track-record in delivery, Emaar has delivered over 43,200 residential units in Dubai and other global markets since 2001.