Dubai

Weighed down by lower revenues during the third quarter, Damac Properties recorded a 23 per cent year-on-year drop in net profit for the first nine months to total Dh2.84 million. Revenues during the third quarter was Dh1.75 billion against Dh2.02 billion a year ago.

Overall revenues in the first three quarters of this year came in at Dh5.12 billion. Gross profit margin during this period stands a quite healthy 57 per cent.

The developer is hoping for a quick turnaround in its bottomline numbers during the fourth quarter itself, with a consistent stream of new project releases sited within its Akoya master-developments.

With the “seasonally strong Q4-16, the management reiterated guidance for full-year sales to be greater than Dh7 billion,” said a statement. (Net cash generated from operating activities totalled Dh537 million and the earnings per share (EPS) for the nine months amounted to Dh0.47 per share.)

“The levels of interest in our new product launches and existing portfolio are healthy,” said Hussain Sajwani, Chairman. “2016 will be remembered not only as the year of market turmoil and macro-economic pressures, but importantly for us the year when the community at Akoya became a reality with the delivery of 1,350 units.”

Across its development portfolio, the developer expects to meet the “lower end of the guidance range” of 2,700-3,000 units from incremental deliveries in Dubai. But it adds that some of its overseas projects are facing “unforeseen delays”.

Damac handed over more than 800 units in third quarter at Akoya, bringing the total deliveries for the nine months to 1,300 units plus.

During the reporting period, booked sales reached Dh5.3 billion, and that in Q3-16 specifically being Dh1.7 billion. This is a 5 per cent sequential growth over Q2-16 and slightly below Q3-15.

Total assets increased to Dh24.34 billion as at September 30 compared to Dh23.45 billion at December 31, 2015. Cash and bank balances were Dh8.90 billion, while development properties were recorded at Dh9.79 billion by September 30.

“The market is definitely challenging — investors today are seeking better value,” said Sajwani. “However, with a medium to long-term view, we believe that Dubai is well-positioned for continued growth.”

For the present, the developer will continue with its high-end and super-premium preferences. There are some signs of the luxury end of the market starting to perk up with new launches.