Damac Properties Hopeful Despite Drop in 2017 Net Profit: Chairman

Published February 14th, 2018 - 12:19 GMT
Hussain Sajwani, Chairman of Damac Properties. (File photo)
Hussain Sajwani, Chairman of Damac Properties. (File photo)

Damac Properties today announced its financial results for the year ended 2017, reporting a total revenue of Dh7.5 billion, a 4 per cent increase over last year, and a net profit of Dh2.8 billion.  

The owner and operator of the only Trump-branded golf club in the Middle East, posted a nearly 47 per cent drop in fourth-quarter profit, while full year profit dropped by 25 per cent, Reuters reported

Damac also announced that it has delivered 20,236 units as of 31 December 2017, marking a milestone for the company and the industry as a whole. 

Gross profit for the year is at Dh3.6 billion, 9 per cent lower than last year as gross margins declined to 48.8 per cent versus 55.9 per cent last year. Margin decline was mainly due to international project deliveries during the year, UAE projects margin remains healthy at 52.1 per cent.

As of 31 December 2017, Damac's booked sales stood at Dh7.5 billion versus Dh7 billion in 2016. The company has completed 2,304 units during the year bringing a total of 20,236 unit deliveries to date.

Total cash and bank balances stood at Dh7.5 billion. Gross debt stood at Dh4.8 billion as at 31 December 2017. This represents a debt to equity ratio of 0.34 versus 0.30 as at 31 December 2016. Earnings per share stood at Dh0.46 for 2017. Board proposed dividend of Dh1.5 bn (Dh0.25/share) for year ended 2017 which will be paid upon approval by the relevant authorities, and the shareholders during the general assembly.

"Dubai's property market continues to show growth as increasing demand returns to the market, and this is reflected in our booked sales. Our medium to long term outlook remains positive, with continued local demand as well and stronger interest by international investors. Our major projects in Dubai including Damac Hills, AKOYA Oxygen and AYKON City continue to appeal to expats and international investors alike, while our diverse product portfolio continues to attract a wide variety of buyers for our off-plan and ready properties," said Hussain Sajwani, Chairman of Damac Properties.

Damac expanded its villa offering at AKOYA Oxygen, its second master community in Dubailand, introducing new villa types designed for buyers seeking value in an integrated golf community. It's partnership with the Roberto Cavalli Group in 2017 led to the launch of the highly-successful 'Just Cavalli' villas, featuring the designer's distinctive signature style.

During 2017, Damac delivered a total of 2,304 units comprising 1,452 units in Damac Hills and 852 units at its international developments, including its two-tower project in Saudi Arabia (Damac Esclusiva - 454 units) as well as its first project in Jordan (The Heights - 398 units) comprising three towers.

Damac's residential leasing at Damac Hills comprised of 328 units, and is 97 percent leased out as at 31 December 2017. Damac also commenced operations of its 305-key Damac Maison Royale The Distinction, in Downtown Dubai, bringing the number of hotels in operation to six.

Construction continues on over 6,500 villas, apartments at AKOYA Oxygen, while its golf course, and community infrastructure is shaping up. The community's amenities, including wellbeing facilities, retail outlets, as well as hospitality, food and beverage elements, are in various stages of planning and progress.

Highlights in 2017 include the inclusion of Damac's stock to the Morgan Stanley Capital International (MSCI) UAE index, which measures the performance of large and mid-cap segments of the UAE market, and now consists of ten listed companies across a range of sectors including real estate, financial, industrial, telecommunications, and others.

2017 also saw Damac working more closely with its agent network locally and globally, having activated 226 new brokers in 2017. Damac also conducted 524 roadshows across 107 cities in 42 countries in 2017 alone.

"We thank the visionary leadership of Sheikh Mohammed bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai and the Government of Dubai for their emphasis on innovation and their relentless pursuit in making Dubai one of the world's most attractive places to live and work, placing it among the world's most competitive cities. As Dubai continues to attract tourists from all over the world, visitors are coming and seeing business potential that Dubai offers, and are choosing to stay," said Sajwani.

"Dubai's property sector is feeling the positive effects of the emirate's appeal and growing sophistication on the world stage. This is evident from the growing real estate sales transactions at Dubai Land Department and we are confident of the growth prospects for the sector going forward. We thank all our stakeholders, our employees and business partners, who continued to contribute to our success in 2017," added Sajwani.

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