RAK Properties to repay part of US$45 mn loan
Developer seeks recovery after falls in profits and stock price
RAK Properties is to repay part of a US$ 45 million government loan as it seeks to further recover its share price and sales after a difficult start to 2010.
The state-owned company highlighted the plan along with the launch of two tenders relating to the utilities for its Jalfar Towers project in Ras Al Khaimah in a board of directors meeting on 7th September.
The developer saw net profits fall 33% for the second quarter of 2010, from AED143.31 million for the second quarter 2009 to AED96.24 million this year. It followed a 39.21% decline in net earnings to AED42.63 million after recording no sales in the first quarter. Government funding had boosted operating revenue which nevertheless fell more than 36% year-on-year.
The two tenders relate to the rental of power generators and chillers to meet the requirements for Jalfar Towers, a residential tower and a commercial tower four kilometres north of Ras Al Khaimah. The AED400 million freehold project was the flagship for the company since was formed by the government and work began in the first quarter 2008.
The company’s share price sank during the second quarter from 56 fils to 35 fils, since recovering to an average price of 39 fils, its closing price last Tuesday.
In July the company signed a mortgage finance agreement with Commercial Bank International, and on 18th of that month it handed over the keys to residents in Precinct 4, part of the Mina Al Arab mega project.