MOTOR-CITY Union properties
Motor City Image Credit: Gulf News archives

Dubai: Union Properties has suffered a steep drop in first quarter net profits to Dh1.74 million from Dh182.71 million a year ago. The developer also saw revenues coming in lower, at Dh103.04 million from Dh115.86 million in the first three months of 2018.

The final profit tally could have been worse had it not been for “other income” providing for Dh74.14 million against Dh3.28 million a year ago. Last year’s first quarter tally also had a one-off gain of Dh125.01 million, from the disposal of the company’s interests in a joint venture.

But even if one were to discount that, the latest revenue and net profit tally would have disappointed the market. The stock continues to trade close to its 52-week low of 30 fils.

In the latest financial statements, Union Properties did see a Dh9.61 million gain on “fair valuation” of investment property. But offsetting that, albeit partially, is a Dh2.5 million loss sustained in disposing investment properties for Dh34.1 million as against the original value of Dh36.6 million.

As of end March, the company had accumulated losses of Dh1.9 billion against a share capital of Dh4.28 billion.

On the operational side, Union Properties remains heavily reliant on further developing its Motor City destination. There was also a recent extension of its interests into hospitality.