Emaar Properties posts rise in first-quarter net income

UPDATE: Dubai developer's international sales more than doubled to Dh2.65bn in the first three months of the year

Emaar Properties reported a 20 per cent hike in third quarter profit for 2019. Chris Whiteoak / The National

Emaar Properties, Dubai’s largest listed real estate developer, reported a 7 per cent year-on-year rise in the first three months of 2019 on the back of strong growth in international sales.

Net income for the three months to the end of March climbed to Dh1.74 billion, the company said in a regulatory filing to the Dubai Financial Market, where its shares trade. Revenue for the reporting quarter was flat at Dh5.89bn.

Emaar, the developer behind the world's tallest tower Burj Khalifa in Dubai, said it recorded one of its highest quarterly sales periods, reaping sales income of Dh5.98bn

Sales to international customers more than doubled to Dh2.65bn, up from Dh1.19bn in the first quarter of 2018, “highlighting the significant interest among international investors in Dubai real estate and the strength of the Emaar brand”, the company said in the bourse filing.

“Our focus on timely project execution and cash-flow generation underlines our market leadership,” said Mohamed Alabbar, chairman of Emaar Properties.

“[Our] operational strategy of building premium residential assets, and expanding the malls, hospitality and entertainment operations … continues to drive our growth.”

Emaar’s hospitality and leisure businesses recorded first-quarter revenue of Dh1.8bn, together with an uptick in footfall at its shopping malls, and average occupancy of 87 per cent across its hotels, the parent company said.

Emaar Malls, the retail business majority owned by Emaar Properties, reported 4 per cent annual growth in revenues to Dh1.07bn in the quarter. Mall assets maintained an average occupancy rate of 92 per cent and the number of visitors in the quarter rose 3 per cent year-on-year to 36 million, Emaar’s statement showed.

During the quarter, Emaar Malls acquired 100 per cent of fashion e-commerce website Namshi from Global Fashion Group in a transaction valued at Dh475.5m.

Meanwhile, Emaar Development, another wholly owned subsidiary of Emaar Properties, recorded 2.3 per cent growth in annual revenues to Dh3.341bn in the first three months of 2019.

The business launched Arabian Ranches III, a gated townhouse neighbourhood in Dubai, as well as three phases of Expo Golf Villas in Emaar South, and several residential projects at Dubai Creek Harbour during the quarter.

Emaar’s sales backlog increased to just over Dh50bn – to be recognised as revenue in the coming years, the company noted. “The strong backlog reflects the robustness of Emaar’s financial position to maintain high revenue, profitability and return to shareholders in the foreseeable future,” Emaar Properties said.

The surge in sales of Emaar’s real estate developments to international investors in the first quarter “not only highlights Dubai’s position as the region’s leading business centre and hub city, but as the one of the most dynamic and growing market economies”, according to Mr Alabbar.

Emaar Properties has a landbank of over 1.6 billion square feet in key global markets.