Emaar Properties net down by 54%

Saturday, February 14, 2009 at 2:02 am

Emaar Properties, developer of the world’s tallest tower Burj Dubai, has reported a 54 per cent decline in net profits to 3.05 billion dirhams for the year 2008. A 1.77 billion dirham writedown in its US subsidiary John Laing Homes in the fourth quarter has pulled down the market mover’s net profits, the developer said in a statement.

Emaar acquired John Laing Homes back in 2005 when the sub-prime crisis first hit the US. The company took a beating in the fourth quarter of 2008, recording disastrous losses of 1.77 billion dirhams or 202 per cent, while in the fourth quarter of previous year, it had a net profit of 1.74 billion dirhams.

Emaar released its 2008 financial results just after the stock market closed on Thursday so the real impact won’t be felt until Sunday, when it reopens. Emaar recorded annual net operating profit of 5.58 billion dirhams in 2008 a 15 per cent decline from 6.56 billion dirhams net operating profits in 2007.

Revenue for the fourth quarter fell to 3.49 billion dirhams from 5.14 billion dirhams the year before. Revenue for the year fell 10 per cent to 16.01 billion dirhams from 17.86 billion dirhams in 2007. The master developer is at present concentrating on completing all projects which have commenced construction and have put new projects on hold.

Explaining the decline in profits, Emaar said, it posted a profit of 0.924 billion dirhams prior to considering the inventory write down in the fourth quarter and recorded a profit of 6.662 billion dirhams for the year prior to considering the total inventory write down during 2008.

“The lower revenue of 3.49 billion dirhams and operating profit of 0.924 billion dirhams for the fourth-quarter (October to December) of 2008 (prior to considering the impact of inventory write down) has resulted in lower overall results for the year 2008. This is primarily due to slowing down of the real estate market in Dubai resulting from the current state of the global financial climate,” it added.

(With inputs from agencies)

( This post is from an independent writer. The opinions and views expressed herein are those of the author and are not endorsed by APakistanNews.Com.)

Emaar Properties net down by 54%

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