Dubai developer Deyaar reports fourfold jump in third-quarter profit to $9.89m

The company expects 'more positive results' as UAE's property market continues to recover

Deyaar's revenue jumped 72 per cent in the third quarter to Dh207.7 million. Reem Mohammed / The National

Dubai property developer Deyaar reported a more than fourfold jump in its third-quarter profit on higher revenue as the UAE’s property market continues to rebound from the coronavirus-induced slowdown.

Net profit for the three-month period ending September 30 climbed to Dh36.34 million ($9.89m), from Dh8.1m in the same period in 2021, the company said on Thursday in a filing to the Dubai Financial Market, where its shares are traded.

Revenue in the third quarter surged 72 per cent annually to Dh207.7m, from Dh120.7m in the same period in 2021.

“Deyaar continues to demonstrate a strong financial performance in 2022.... boosted by the positive trends recorded by the UAE’s real estate sector," said Saeed Al Qatami, chief executive of Deyaar.

The UAE’s property market continues to recover from the pandemic on the back of government initiatives such as residency permits for retirees and remote workers, as well as the expansion of the 10-year Golden Visa programme and the economic boost generated by Expo 2020 Dubai.

In Dubai, average residential prices in the third quarter grew 9 per cent annually while average rental rates rose by 25 per cent, with both sales and rentals bolstered by more robust demand and increased buyer activity, according to a recent report from consultancy JLL.

In Abu Dhabi, sale prices during the three months period climbed 4 per cent while average rents increased by 2 per cent annually, the report said.

Off-plan and secondary property sales in Dubai reached a 12-year high in the third quarter, both in terms of volume and value, according to a report by Property Finder.

A total of 25,456 sales transactions worth Dh69.72 billion were recorded in the third quarter, marking an increase of about 62 per cent in terms of volume and more than 65 per cent in terms of value, compared with the third quarter of 2021.

Deyaar’s nine-month profit jumped more than threefold to Dh103.2m as compared to Dh30.8m during the same period last year as revenue during the period climbed 38 per cent to Dh577.1m, according to the financial statement.

The company's total assets grew 6 per cent to Dh6.1bn by the end of September compared with Dh5.79bn at the end of December last year. Total liabilities grew 17 per cent to Dh1.67bn during the same period.

In a separate filing, Deyaar also said the company's board has recommended to approve a Dh500m cash settlement offer made by Dubai-based developer Limitless.

The offer includes paying Dh200m immediately upon signing the agreement and completing the payment of Dh300m within a period not exceeding 18 months from the signing of the agreement between the two companies.

The board also suggested holding a general assembly meeting on November 21 to present the settlement offer to the company's shareholders for approval after obtaining the necessary permissions from the Securities and Commodities Authority, the company said.

In 2019, a UAE court ordered Limitless to pay Dh411.9m to Deyaar in a dispute related to the purchase of land. The court also ordered Limitless to pay fees and compensation of Dh61.1m to Deyaar.

"With Midtown’s Mesk and Noor districts on track for handover, alongside the successes achieved by the Regalia and Tria projects in attracting more investors with a sales record of more than Dh1.5bn and the proposed Limitless settlement, we are confident in our ability to achieve even more positive results during the next quarter," Mr Al Qatami said.