"Non-cash items" adversely hit DAMAC's 2019 performance

EXCLUSIVE: Senior vice president, DAMAC Properties, Niall McLoughlin told CW total revenue grew 80% YoY in Q4 2019

DAMAC is developing Aykon City in Dubai.
Damac
DAMAC is developing Aykon City in Dubai.

DAMAC Properties’ recently announced its financial reports for 2019, which revealed that the company recorded a net loss for the first time in a decade, with $10m (AED36.8m) for the year ending on 31 December 2019.

Pointing at the reason behind the downward movement of the company’s financial position, the Dubai Financial Market-listed firm’s senior vice president,  Niall McLoughlin told Construction Week that the developer’s “financial performance for 2019 was adversely impacted by non-cash items such as provision for impairment on development properties and provision for doubtful debts worth $44.9m (AED165m)”.

McLoughlin added: “DAMAC Properties’ total revenue has grown 80% year on year in Q4 of 2019.”

2019 revenues also plunged by 41.7% to $1.2bn (AED4.4bn) compared to $1.7bn (AED6.1bn) in 2018.

Commenting on the financial results, chairman, Hussain Sajwani had said that the developer “selectively launched fewer projects in softer market conditions to avoid adding new commitments” adding that it is focusing on selling the inventory that is either completed or is nearing completion.

The developer’s total assets for the same period stood at $6.5bn (AED23.8bn) having decreased by 6.2% from $6.9bn (AED25.2bn) in the year before. Meanwhile, shareholders’ equity stood at $3.8bn (AED14bn) compared to $3.9bn (AED14.1bn).

Meanwhile, the developer of DAMAC Hills posted booked sales of $844m (AED3.1bn) in 2019 and delivered 4,700 units in the same period.

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