Dubai property developer Deyaar said its first-quarter net profit increased about 67 per cent on higher revenue and the continued diversification of the company's operations.
Net profit for the three-month period to the end of March climbed to Dh25.1 million ($6.8m), the company said on Wednesday in a regulatory filing to the Dubai Financial Market, where its shares are traded.
Revenue for the period rose 9 per cent to Dh161.9m, the company said.
“The results of the first quarter come as a continuation of the positive results achieved by the company last year, thanks to our strategy in diversifying the revenue stream by strengthening our projects portfolio, property and facilities management services, in addition to the hospitality sector,” said chief executive Saeed Al Qatami.
The results did not include any revenue from the company's Regalia project, he said.
“Therefore, we expect an increase in revenues in the coming months attributable to … our Regalia project, which was successfully sold out with a total value of nearly Dh1 billion,” Mr Al Qatami said.
Deyaar and other developers in Dubai have benefitted from a rebound in the local property market, with transactions picking up on the back of fiscal and monetary measures provided to soften the blow of the coronavirus-induced slowdown.
Pent-up demand, improving investor sentiment and the economic recovery have also helped to drive property sales.
New initiatives, such as visas for retirees and the expansion of the 10-year golden visa programme, are expected to support the local market, industry experts say.
Dubai registered 25,972 property transactions in the first quarter of this year, the highest number of deals in a three-month period since 2010, according to Mo’asher, the emirate’s official sales price index that is issued by the Dubai Land Department in partnership with Property Finder.
The period from January to March had a total of 20,539 sales transactions worth Dh55.51bn.
In April, Deyaar's shareholders approved a proposal to write off accumulated losses worth Dh1.7bn through the company’s legal reserve and the cancellation of shares equal to the remaining losses.
The move will reduce the company's capital by Dh1.4bn to Dh4.38bn, as well as increase its “attractiveness to investors and the possibility of obtaining funds for its future projects”, it said at the time.
“The capital reduction is currently under process and will be reflected in the market upon completing the related authorities’ approvals and formalities,” the company said in a separate statement on Wednesday.
Deyaar launched various projects in 2021, with others expected this year in Jumeirah Village Circle, Al Furjan and Dubai Production City, vice president of sales, Nasser Amer, told The National in November.
The developer is majority owned by Dubai Islamic Bank, the UAE’s biggest Sharia-compliant lender.
The company will focus on completing all existing projects and will focus on launching new ones with “high selling rates”, it said in the latest statement.