Emaar Properties declared record revenues
Reiterating its strong grip on fundamentals, global real estate major Emaar Properties PJSC has announced record revenue and net profits of AED 5.079 billion (US$ 1.383 billion) and AED 3.053 billion (US$ 0.831 billion) respectively, for the half year ended 30 June 2006. The revenue and profit for the second quarter of 2006 (April to June) were AED 2.840 billion (US$ 0.773 billion) and AED 1.536 billion (US$ 0.418 billion) respectively.
Emaar’s net profits for the first six months of the year gained by 21 per cent over the record first-half 2005 results of AED 2.533 billion (US$ 0.690 billion). Revenues for the half year grew 8 per cent over half-year 2005 results of AED 4.717 billion (US$ 1.284 billion).
Net profits grew 1 per cent over the first quarter 2006 results of AED 1.517 billion (US$ 0.413 billion), and by 27 per cent over the net profit of AED 1.208 billion (US$ 0.329 billion) in second quarter 2005.
Second quarter 2006 gross profit rose to AED 1.681 billion (US$ 0.458 billion), an increase of 13 per cent from AED 1.487 billion (US$ 0.405 billion) during the first quarter of 2006, and 40 per cent from AED 1.199 billion (US$ 0.326 billion) in the second quarter of 2005.
Annualized Earnings per Share (EPS) for the period is AED 1.04 compared to the actual EPS of AED 0.85 for 2005.
“Our global expansion programme is on overdrive and aligned with our vision of becoming one of the most valuable companies in the world in the next four years,” said Mohamed Ali Alabbar, Chairman of Emaar Properties. “The second quarter results are indicative of the robustness that marks Emaar’s fundamentals. As a company committed to its shareholders, we want to go the extra mile and enhance investor confidence through value-added projects.”
During the first half of 2006, Emaar announced a number of international projects of development value AED 79.04 billion (US$ 21.52 billion).
Following the enactment of the Dubai Property Law early-2006, sales for both residential units and land plots strengthened in Dubai. The second quarter’s outstanding performance also mirrors the expansion of the company into new markets, a consolidation of its presence in North Africa and groundbreaking diversification into education and healthcare.
“Emaar gains its momentum for growth from Dubai, which has made rapid strides in all sectors driven by the vision of UAE Vice President and Prime Minister and Ruler of Dubai His Highness Sheikh Mohammed Bin Rashid Al Maktoum,” said Alabbar. “As the regional hub for trade and commerce, property development, information technology, media and knowledge resources, Dubai fuels the growth of companies like Emaar.”
In line with Emaar’s expansion plans, in June, the Emaar board of directors approved the company’s acquisition of John Laing Homes, the second largest privately held homebuilder in the US. This first US foray of Emaar reiterates the real estate developer’s projected Vision 2010 of becoming one of the most valuable companies in the world through careful expansion and diversification.
The AED 3.856 billion (US$ 1.050 billion) acquisition of John Laing Homes was funded from the proceeds of Emaar’s July 2005 rights issue, which doubled the capital of the company to AED 6.1 billion (US$ 1.66 billion).
In the second quarter, Emaar further consolidated its Vision 2010 strategy through a series of planned expansions. The company signed a Memorandum of Understanding with His Majesty King Mohamed VI of Morocco to develop three landmark projects of development value AED 19.8 billion (US$ 5.39 billion). Ground breaking for Emaar’s fourth project in Morocco, the AED 12.5 billion (US$3.4 billion) Saphira development in Rabat, was held in May 2006.
Emaar also entered into a joint venture partnership with the Syrian General Organization for Housing to float a new company that will initiate several socio-economic developmental projects in Syria including the construction of homes, in several phases, for the middle-income segment. Emaar also launched the first leg of its modern, community-living developmental projects in the country with the ground breaking of the AED 1.836 billion (US$ 500 million) Eighth Gate.
In significant regional expansion in the second quarter, Emaar signed a Memorandum of Understanding with Pakistan’s Port Qasim Authority for mixed use land development in Karachi, and also announced three master-planned communities in Islamabad and Karachi of development value AED 8.8 billion (US$ 2.4 billion).
Underscoring on-schedule completion of its projects, Emaar opened its first full-scale hotel in India, the Novotel Hyderabad, which is connected to the Hyderabad International Convention Centre, by hosting the 39th Annual Meeting of the Board of Governors of the Asian Development Bank in May 2006. The 287-room hotel was built by Cyberabad Convention Centre Private Limited, a joint venture between Emaar and the Andhra Pradesh Industrial Infrastructure Corporation Limited (APIIC).
Emaar, the single largest private sector developer in Saudi Arabia, with the SR 100 billion (U$ 26.6 billion) King Abdullah Economic City, expanded operations in the Kingdom. The company partnered with Al Oula Development to build Jeddah Hills, a SR 41 billion (US$ 11.2 billion) community project. Second quarter growth also saw Emaar announcing plans to develop the AED 6.9 billion (US$ 1.88 billion) Marina Al Qussor project in Tunisia.
At the beginning of July, Emaar also announced plans to open a full-fledged representative office in China, thus becoming the first Middle East property developer to effectively tap the potential offered by the world’s second largest economy.
On July 12, Emaar also announced their investment in a newly formed entity, Turner International Middle East Ltd (Turner International ME) with The Turner Corporation, a leading international building services provider, to jointly tap regional growth opportunities.
On home-turf, Emaar marked a milestone in its historic quest to build the world’s tallest tower as the AED 3.673 billion (US$ 1 billion) Burj Dubai scaled 50 levels in June. Work is on course for a 2008 completion with one new level added every four days. Emaar completed the hand over of 14,000 homes in Dubai and also launched other community developments including a series of homes at The Views.