RAK Properties profit drops on higher finance costs

The company plans to deliver the Julphar Residence project on Reem Island during the current quarter

RAK Properties handed over apartments at the Gateway Residences project, part of its Dh10 billion Mina Al Arab development in Ras Al Khaimah, during the second quarter. Pawan Singh / The National

RAK Properties reported a 21 per cent drop in third-quarter net profit due to higher finance costs.

Net profit for the three months to the end of September declined to Dh14 million ($4m), the company said in a statement to the Abu Dhabi Securities Exchange, where its shares trade. Finance costs jumped ninefold to Dh7.5m, while revenue rose 2 per cent year-on-year to Dh57.5m.

The developer said it handed over apartments at the Gateway Residences project, part of its Dh10 billion Mina Al Arab development in Ras Al Khaimah, during the second quarter. The scheme has 144 apartments.

Its Julphar Residence project in the City of Lights on Reem Island in Abu Dhabi is expected to be delivered during the current quarter with sales and leasing activity to commence soon after, the developer said on Sunday.

RAK Properties is also working two other projects in Ras Al Khaimah including the Marbella Villas with 205 villas and townhouses and the two-towerBay Residence project.

Marbella Villas is expected to be delivered next year, while construction at Bay Residence will start this quarter, according to the company.

In the hospitality segment, the company is building a 350-room Intercontinental hotel and resort and a 174-room Anantara Mina Arab hotel and resort.

“The construction of hotel properties has been progressing as per [the] development plan, with a target to start the first hotel operation by the fourth quarter of 2021,” Mohammad Al Qadi, managing director of RAK Properties, said.

Profit for the nine months of this year rose 20 per cent to Dh41m as revenue grew 30 per cent to Dh177.5m, the company said.

Total assets at the end of September reached Dh5.7bn, up 2 per cent since the end of last year.