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Plot sales at the sprawling Akoya project, which also includes the bespoke Trump Estates cluster, had a substantial share of Damac Real Estate Development Ltd.'s upbeat first-half revenues of $991.9 million, up 57 per cent over the $631.9 million in the same period last year.
An interim dividend of 24.928 cents a share (74.784 cents to a GDR global depository receipt) has been declared, which works out to a total outgo of $162 million. This, the London-listed company said in a statement, represents a yield of 6.1 per cent based on the GDR listing price in December 2013 and 4.6 per cent based on the June 30, 2014 closing price. Gross margins ''remained strong'' at 57.4 per cent, though representing a slight decline from the 61.4 per cent in the first quarter.
The developer had earlier this month acquired a substantial new land mass — all of 55 million square feet — in Dubailand for $513 million. The deal was handled through the company's subsidiary, Front Line Investment Management Co. llc.
The Akoya cluster transactions represented 31 per cent — or $305.1 million — of the developer's top-line numbers in the first six months. It could set the stage for more, as Damac has maintained a steady hand with new releases, at Akoya as well as at other key locations in Dubai — in Burj and Business Bay — during the same period. There was also the launch of a signature project in Qatar.
Operating profit for the first-half was $463.2 million (against $332.7 million in H1-2013), while total assets attributed bulked up by 41 per cent to $4.28 billion, a 41 per cent gain from the numbers at the end of last year.
Other strong numbers come by way of advances from customers — $1.8 billion — and the net cash position at $1.01 billion after receiving a boost from the $650 million sukuk issue.
''The balance-sheet remains strong,'' said Hussain Sajwani, Executive Chairman and CEO of Damac. ''During the first-half we delivered 1,634 units across five projects and we are on track to complete a total of 4,000-5,000 units during 2014. Booked sales increased 75 per cent to $1,682.6 million ($960 million in H1-2013) with our sales rate across our key projects in line with expectations.
''During the period we acquired four tactical plots in Dubai, in line with our strategy of replenishing our land bank with land in prime Dubai locations to ensure a consistent pipeline of future sales inventory.
''Demand for our luxury products remains high, and we strongly believe that the current real estate market in Dubai remains sustainable, supported by structural and ongoing supply-demand imbalance for high-end property. We have a strong brand across the Middle East and we believe this to be a true differentiator from our competitors.''
In the first-half, Damac had the handover of its first overseas development, Al Jawharah, in Saudi Arabia, and launched Burj Damac Waterfront in Doha.
The hospitality side of its business has sustained its momentum. ''We launched Naia by Damac in April and opened our second project, Naia Jebel Ali, in June,'' said Sajwani. ''We will look to expand this part of our business and will be bringing forward new hospitality projects in the second-half.''
Source: Manoj Nair, Associate Editor, gulfnews.com