Emaar profit drop weighs on Dubai market

Markets Update: Emaar Properties, one of the biggest companies by market cap in the UAE, yesterday reported a slump in first quarter net profit, dragging down Dubai shares - with video.

Heavyweight Emaar Properties dragged on shares in Dubai this morning as the property giant reported a drop in net profit, missing analysts' expectations.

The developer of the world's largest tower, the Burj Khalifa, said net profit dropped 45 per cent in the first quarter as it handed over fewer new homes than a year earlier. In the first day of trade since announcing the results, its shares fell 2.3 per cent to Dh3.36.

Haissam Arabi, chief executive of asset management company Gulfmena Alternative Investments in Dubai said Emaar's results are missing clarification on provisions or losses related to associated companies, including Amlak the mortgage lender, and its Indian unit.

"I'm not worried about the top line but we are not clear about any provisions or losses booked on associates. They need to be clear about that," he said.

The news dragged down shares in other property developers, including Arabtec which traded 2.6 per cent lower to Dh1.46 and Deyaar Developments which fell 4.6 per cent to 31 fils.

After a rally of more than a month, Dubai's market has this week reversed gains and this morning slumped 1.25 per cent to 1,644.32 points.

In Abu Dhabi, the market fell 0.5 per cent to 2,697.98 points, with property stocks also being impacted. Sorouh Real Estate fell nearly 2 per cent to Dh1.48 and Aldar Properties decreased 2.4 per cent to Dh1.61.

But du, the UAE's second mobile operator, advanced 0.3 per cent to Dh3.29 as its net profit more than doubled on subscriber adds.