Nakheel H1 profit jumps 54pc on new projects
Dubai, July 9, 2014
Dubai property developer Nakheel, which was a major victim of the emirate's financial crisis five years ago but is now recovering strongly, reported a 54 per cent jump in profit for the first half of this year.
The government-owned company made a net profit of 1.85 billion dirhams ($504 million) in the six months to June 30, up from 1.20 billion dirhams in the corresponding period of 2013, it said in a statement on Wednesday.
The company did not provide any quarterly figures. However, Reuters calculations showed a net profit of 1.22 billion dirhams in the second quarter compared to 709 million dirhams a year earlier.
The company said profits were boosted by strong revenue from property development, as it handed over 627 units to customers in the period. It did not provide revenue figures.
Commenting on the performance, chairman Ali Rashid Lootah, said: "These robust financial results reflect the growth witnessed in the real estate sector in Dubai, where Nakheel continues to play a strategic role. Since the financial year ending 2010, Nakheel has reported a year-on-year increase in net profit."
"Our financial performance reflects the strength of the underlying business, increasing investor trust and confidence in Nakheel and the on-going support of the Government of Dubai," he added.
Nakheel had agreed a $16 billion debt restructuring in August 2011, which included $2.2 billion in bank debt, and scaled back grandiose plans such as building a one-kilometre-high tower.
But last month it said it was gearing up for substantial growth and planned to repay 5.54 billion dirhams of outstanding debt to banks four years ahead of the restructuring schedule.
According to him, Nakheel is currently developing a diverse range of new projects in the residential, retail, leasing and hospitality sectors.
"Among them are Nakheel Mall; The Pointe; Deira Islands Mall; Deira Islands Night Souk; extensions to Dragon Mart and Ibn Battuta; community retail centres at Jumeirah Park, Al Furjan, International City, Discovery Gardens and Badrah; residential and retail leasing units at Warsan Village and a new community of 1,000 villas for lease," he revealed.
Nakheel, he said, was also planning to build 10 hotels – from five star luxury establishments to simpler, budget-style accommodation – over the next five years.
The key among them are The Palm Tower on Palm Jumeirah, several establishments at Deira Islands and hotels at Dragon Mart and Ibn Battuta.-Reuters and TradeArabia News Service