Property developer’s share price falls by 6.62% despite 45% rise in quarterly profits
Shares in Damac Properties on Tuesday tumbled by more than 6% after the Dubai developer said its third-quarter revenues had fallen, and despite higher profits for the period.
The Dubai Financial Market-listed company said it made a profit attributable to shareholders of AED1.021 billion in the third quarter, up from AED825 million during the same period last year, marking a 45% increase.
But its third-quarter revenue of AED2.018 billion was lower than the AED2.121 billion reported in the same period last year. Last year’s Q3 revenues were generated solely through constructed apartments, Reuters reported, while this year’s include land sales worth AED491.6 million.
The results were followed by a sharp drop in the Dubai developer’s share price, which on Tuesday fell by 6.62% to AED2.82.
Damac reported a net profit of AED3.67 billion (around $1 billion) in first nine months of 2015, an increase of 43% on the same period last year, it said in an emailed statement. Revenues over the nine-month period stood at AED6.77 billion ($1.84 billion), it said.
The company anticipates that around 2500 units will be delivered across its portfolio in 2015. The total property area sold in the first nine months of 2015 stood at 6.24 million square feet – around 8.5% higher than the same period in 2014.
“These numbers show that the Dubai real estate market remains healthy,” said Hussain Sajwani, Chairman of Damac.
“During 2015 the Dubai real estate market has continued to mature, with growth stablisation across the period. This is a natural progression for any developing market which ensures long-term sustainability.”
“We expect prices to continue to stabilise as we operate in a now mature real estate market. This is the natural progression for any developing market which ensures long-term sustainability.”
Developments underway include the Akoya by Damac master development in Dubai, which is currently under construction.