Dubai: Nakheel pulls off 54% growth in net profit

Dubai: Nakheel pulls off 54% growth in net profitImage Credit: Supplied

Sustained growth on all of its key income generating business lines helped Nakheel post net profits of Dh1.85 billion for the first six months of the year. This is 54 per cent higher than the Dh1.2 billion recorded same time last year.

The numbers also show the second quarter numbers as particularly strong, with Dh1.2 billion recorded between April to June. In comparison, the first quarter net was Dh629 million. (The revenue breakdown was not provided.)

''Since the financial year ending 2010, Nakheel has reported a year-on-year increase in net profit,'' said Ali Rashid Lootah, chairman. ''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.

''With the bank debt repaid ahead of time and new cash generating assets coming on stream, Nakheel is well on course to further strengthen its business and financial position going forward,'' Lootah said.

The robust first-half numbers gives further ballast to Nakheel's decision — announced late last month — to clear its debt obligations of Dh7.9 billion by August this year, and a full four years before they are due.

In the first-half, Nakheel handed over 627 units while the retail and leasing lines recorded ''full occupancy of the available units'', Nakheel reported. The leisure business also put in an improved performance over previous years, the company said in a statement. (Going forward, hospitality has been earmarked as one of the pillars to drive future growth, especially in locations such as the Deira Islands. Nakheel is to build 10 hotels — ranging from luxury establishments to budget-style accommodation — over the next five years.)

''The Al Furjan community has been generating a lot of interest for both plots and the villa units, and Jumeirah Village continues to be on investor radar,'' said Niraj Masand, partner at the property firm Banke M.E.

At Al Furjan specifically, individual developers have started to mobilise their projects. Azizi Developments on Tuesday confirmed that construction works were re-launched for two residential projects there, each in a ground plus 11-storey format.

According to a market source, Nakheel has been able to leverage the retail and other leasable stock at its communities to optimum levels. ''Retailers or providers offering convenience services see they have a sizable consumer base at their doorstep,'' the source said. ''Nakheel communities, the new ones in particular, offer coveted spots for them.''

Source: Manoj Nair, Associate Editor,


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