RAK Properties net rises 10% as unit sales rise
Flagship Mina Al Arab boosts net assets as project reaches milestones
RAK Properties saw net profit rise more than 10% in 2010 against the previous year, as strong sales on its flagship Mina Al Arab project in Ras Al Khaimah helped spur revenue.
The state-backed developer posted after-tax gains of AED 187.35 million, up from AED 170 million from the previous year. The company showed a rise in the value of its net assets from AED 3.143.45 million to AED 3.33 billion as the ongoing completion villas and townhouses in Precinct 4 on the AED 10 billion mixed use coastal project filters through to the balance sheet.
The company stated that the sales revenue of AED 151 million of the villas will show up on the company’s financial statements this year. Shares rose 2.4% to 42 fils yesterday.
RAK Properties, which is also developing Julfar Towers and RAK Tower in the northern-most emirate, last year saw the completion of 213 villas in Precinct 5 on the Mina Al Arab. The project comprises seven precincts of 5,500 units including villas, luxury villas, townhouses and apartments spread along the coast and two islands that sit just off shore. A line of eight hotels will eventually run along the coast of the two islands facing the ocean. One of the hotels has been lined up for a tender process, according to John Heck, vice chairman, speaking to CW last year.
The project has needed to adjust its construction schedule to the slowing property market in the UAE. This year it aims to handover the Julfar Tower, RAK Tower, as well as homes in Precinct 5 and Precinct 2 – also known as the Lagoon, where its property management division will maintain facilities.
The company also last year repaid an AED 185 million loan from Investment Development Office, the local government entity promoting investment in the UAE. Total equity in the company rose to AED 3.330 billion.
Chet Riley, an analyst at Nomura International in Dubai, posted a ‘reduce’ rating on the stock on 23rd January. Nabil Ahmed at Deutsche Bank declared it a ‘hold’ on 16th September 2010.