Emaar Properties, Dubai’s largest listed property developer, posted a 48% increase in its quarterly profit from a strong upturn that boosted by growth in its malls, hotels and property business.
A bellwether for Dubai’s real estate market, Emaar has led a recovery in that sector, and most of the projects it launched in the last few months were sold out within hours, reminiscent of the period before the 2008 global financial crisis.
Fourth-quarter net profit of 756mn dirhams ($206mn) compared with 512mn in the corresponding period of 2012, it said in a statement yesterday.
Analysts in a Reuters poll had predicted on average a net profit of 622mn dirhams.
Revenue for the quarter was 2.76bn dirhams, up 3% year-on-year. Emaar’s full-year net profit was 2.57bn dirhams, an increase of 21% over 2012.
Dubai’s largest property firm said revenue from its malls and hotels, accounted for nearly half of the total revenue.
Meanwhile, total value of property sales in Dubai for 2013 was 12bn dirhams, nearly three times the amount in 2012.
Property prices in Dubai have fallen more than 50% from their 2008 peak.
Moody’s upgraded the developer’s ratings by two notchs, one level short of investment grade, on the back of the figures, although the ratings agency said it remained cautious about “the sustainability of current market trends”.
However “...the company’s resilient recurring cash flows from its investment properties coupled with the success of its new project launches and reduced gross debt levels has significantly strengthened the credit profile of the company,” Moody’s said.
Emaar regained its investment grade credit rating from S&P this month.