Emaar’s nine-month profit surges 42% on property sales boost

Dubai developer reports $2.2 billion profit for the period

Emaar's group property sales for the nine months of 2023 surged 16 per cent year-on-year to Dh31.1 billion. Chris Whiteoak / The National

Emaar Properties, Dubai's largest listed developer, reported a 42 per cent annual jump in its nine-month profit on higher sales as the UAE property market continues to grow strongly.

Net profit for the nine months to the end of September climbed to Dh8.2 billion ($2.2 billion), the company said in a statement on Thursday to the Dubai Financial Market, where its shares are traded.

Group property sales for the period surged 16 per cent year-on-year to Dh31.1 billion, while revenue fell around 3 per cent annually to Dh18.4 billion.

The company's revenue backlog from property sales reached Dh69.5 billion as of September 30, according to the company.

“Our financial performance, underscored by recent credit rating upgrades, reflects our strategic investments and their ensuing returns,” Mohamed Alabbar, founder of Emaar said.

In June, S&P Global Ratings upgraded Emaar Properties' long-term issuer credit rating based on expectations of more robust business performance.

The company's credit rating was upgraded to “BBB” from “BBB-", with a stable outlook.

Dubai's property market rebounded strongly from the coronavirus-induced slowdown on the back of government initiatives and a broader growth in UAE’s economy.

Dubai recorded 116,116 new property transactions worth about Dh429.6 billion in the first nine months of 2023, according to the latest data from the Dubai Land Department.

Total transactions surged 33.8 per cent on an annual basis, while values rose more than 36.7 per cent during the period.

In the third quarter of this year, average residential property prices across Dubai grew by 19 per cent on an annual basis and 5 per cent when compared to the previous quarter, according to a recent Knight Frank Report.

The consultancy expects property prices to continue to rise next year.

Emaar Development, a majority-owned subsidiary specialising in build-to-sell property development business, recorded property sales of Dh28.9 billion during the first nine months of 2023, up 25 per cent over the same period in the previous year, the company said.

Its revenue during the period reached Dh7.4 billion, while earnings before interest, taxes, depreciation and amortisation (ebitda) grew 36 per cent annually to Dh4.5 billion.

Emaar's shopping mall, retail, and commercial leasing operations, meanwhile, reported a revenue of Dh4.3 billion in the first nine months of this year, according to the statement. Its mall assets achieved an average occupancy rate of 97 per cent.

Emaar’s international real estate operations, which represent more than 11 per cent of Emaar’s total revenue, recorded property sales of Dh2.2 billion with revenue totalling Dh2.1 billion during the period. This was primarily driven by operations in Egypt and India, the company said.

In the first nine months of 2023, Emaar’s hospitality, leisure, and entertainment divisions generated Dh2.5 billion in revenue, up 22 per cent compared to the same period last year amid a steady recovery in the tourism sector and strong domestic spending.

Dubai welcomed 8.55 million international visitors in the first six months of 2023, exceeding the pre-pandemic figure of 8.36 million tourists in the first half of 2019, according to official figures.

Emaar’s UAE hotels, including those under management, reported an average occupancy of 70 per cent in the first nine months of 2023.

Emaar's recurring revenue from malls, hospitality, leisure, entertainment, and commercial leasing rose 26 per cent annually to Dh6.8 billion during the period, the company said.