Dubai Investments pledged to continue its diversification drive after reporting a rise in first-half profit.
Profit rose 2 per cent to Dh516 million compared to Dh506m a year earlier.
The company said that its total income for the period increased by 18 per cent to Dh1.37bn from Dh1.17bn, which it attributed to a 20 per cent increase in rental income to Dh424m, an 8 per cent increase in contract revenue to Dh236m and a Dh186m gain on the disposal of subsidiaries and valuation gains. However, the latter was offset by mark-to-market valuations on investments, with Dh27m wiped off their book value.
Total assets rose to Dh15.7bn – up Dh446m since the start of the year. Net assets increased in value by just over Dh100m to Dh11.3bn, and the company said that it held a “healthy” cash balance of Dh1.1bn even after a dividend payout of Dh486m in May.
Khalid bin Kalban, the chief executive of Dubai Investments, said: “Dubai Investments delivered a solid set of financial results, completed a number of important transactions and is in a strong position to deploy capital into attractive investment opportunities to drive future growth.”
He added: “Building on the positive momentum generated in the first half of 2016 against the backdrop of a challenging market environment, the company plans to continue its diversification strategy, aimed at broadening its geographical footprint, growing its asset base to increase earnings and creating value for shareholders.”
Alongside the land at Dubai Investments Park, where 100 new companies have set up shop within the past 12 months, Dubai Investments owns more than 40 subsidiaries and joint ventures involved in a range of industries including glassmaking, plastics, cooking oils, a dairy farm and various real estate projects. It also has stakes in financial services companies and is a 50 per cent stakeholder in the Emicool district cooling business alongside developer Union Properties.
In June, Mr Bin Kalban said that it would look to invest in properties in the health care and education markets after setting up a pair of funds worth Dh1bn each with Al Mal Capital, in which it owns a 60.8 per cent stake.
Notes to the accounts show that one of the group’s subsidiaries had been owed Dh222m by a company that had taken a 90-year lease on a plot at Dubai Investments Park, but had failed to pay for it. A legal battle ensued, with the customer alleging a breach of contractual obligations, and although Dubai Investments won a case at the Dubai Court of First Instance an appeal was lodged. Eventually, the two sides have come to an agreement to form a joint venture company known as Palisades Development Company which will develop the plot. Proceeds of any sales on the land will then be used to pay Dubai Investments the money it is owed.
mfahy@thenational.ae
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