Deyaar back in black with $12m half-year profit
Dubai developer gains returns from unit sales despite tough market
Deyaar Development, the property company, has surged back into the black in the first half of 2011 as units sales of completed projects fed through to its financial results.
The Dubai based developer saw after tax gains of AED 44.4m (12.08m), a significant bounce from the AED 344m ($39.20m) loss from the same period last year as a result of the collapse of the property market in the second-biggest emirate. Rents in the city have reduced by around 60%, shrinking the returns for local developers.
Gross revenue for the period reached AED 480m ($130.67m), up from AED 325m ($88.47m), as a “small portion” of units in its five main completed projects were able to be handed over to investors.
“I am very pleased to share our financial results for the first half of 2011, which are in line with our expectations and reflective of our sound fundamentals,” said Deyaar CEO Al Qatami, adding that the company intends to handover further units by the end of the year.
Deyaar Development has seen its stock price trade under 35 fils for the majority of the year as investors remain bearish on UAE property companies. Last year the company said it may dumnp the Flamingo Creek project it bought for AED372m ($101.27m) on concerns that the master developer, Sama Dubai, would not complete the infrastructure.
This year the company has been able to restructure its Islamic loans by extending the repayment period.
It has also attempted to bolster its construction and facilities management service, tin January purchasing outright its subsidiary Omega Engineering for an undisclosed sum.
Shares rose 4.76% in afternoon trading in Dubai Wednesday to 264 fils, a similar level to the end f February.