Emaar Development, the real estate arm of the UAE's biggest developer Emaar Properties, posted a 62 per cent rise in the first quarter net income as revenues surged on the back of continued delivery of projects.
The company reported net profit of Dh819 million for the three months to the end of March, up from Dh506m reported a year earlier, the company said in a statement to the Dubai Financial Market, where its shares are traded. The quarterly revenues almost doubled to Dh3.27 billion, from Dh1.67bn, reflecting strong progress in construction of its projects, it said.
Emaar Development, which follows a build-to-sell business model, floated its shares on DFM in the fourth quarter of 2017 in the largest listing on the bourse since 2014. It recorded sales of Dh3.91bn in the first three months of the year and currently has a total sales backlog of Dh41bn, which highlights a delivery pipeline of more than 27,200 residential units in the next four to five years.
“With the listing of Emaar Development, our focus was to unlock its true potential … this is demonstrated by the growth of the business and focus on delivering high quality projects,” said Mohamed Alabbar, chairman of Emaar Development and Emaar Properties. “With our new developments, we are bringing exceptional lifestyle choices … that add value to the economy.”
The real estate market in the UAE has faced headwinds amid softer economic conditions and supply overhang. It is expected to turn a corner later this year as market sentiment improves on the back of stabilising oil prices and increased government spending. Oil prices rebounded to as high as $75 last week, the highest since 2014.
To take advantage of the potential upswing, the company’s parent Emaar and Abu Dhabi’s biggest-listed developer Aldar properties, earlier this year announced a joint venture to develop Dh30bn worth of projects pipeline with an initial focus on two developments in Abu Dhabi and Dubai.
Emaar Development, which recorded a 30 per cent jump in its 2017 full-year net income, launched the sale of more than 2,500 residential units during the first three months of 2018. It has more than 10 mega-developments in its portfolio and the firm aims to maintain leadership role in prime residential real estate in Dubai, it said.
Beach Vista and Sunrise Bay projects in Dubai together recorded total sales of over Dh1.35bn. The company also launched The Grand project, at its Dubai Creek Harbour mega-development, which is nearly two and a half times the size of Downtown Dubai.