Property

Damac shares soar 15% on Dubai market as Q2 profits triple

By Ben Flanagan

Posted on August 5, 2015

The developer, which listed on the Dubai Financial Market in January, announced a 20% dividend in cash and shares

PHOTO: Damac’s strong results come despite a decline in house prices in its home market of Dubai. Credit: Damac

Shares in Damac Properties soared by 15% on Wednesday after its financial results indicated the developer’s second-quarter profits had tripled.

The Dubai-listed firm reported a net profit of Dh1.42 billion ($386 million) for the three months to June 30, up from Dh461.1 million a year earlier, according to a statement to the Dubai Financial Market.

It also announced a 20% interim dividend payment – amounting to Dh550 million in cash and 550 million bonus shares – which helped cheer investors. Shares in the company rose to a value of Dh3.68.

Damac reported 50% growth in net profit over the first half of 2015, compared with the same period last year. It said it made $1.292 billion in revenues and $721 million in net profit during the first half.

The company, which listed on the Dubai Financial Market at the beginning of 2015, said it handed over 1,511 units over the first half of the year.

The results come despite a decline in house prices in Damac’s home market of Dubai. Hussain Sajwani, chairman of Damac, said the Dubai market had seen a positive “price stabilisation” in 2015.

“This is a welcome and natural progression for any developing market which ensures long-term sustainability,” he said in a statement.

A recent report by Knight Frank found that luxury property prices in Dubai had declined 4.5% in the second quarter, compared to a year ago, partly due to the stronger dollar deterring buyers from the Eurozone and Russia.