Dubai’s Nakheel Reports 57% Profit Rise In First Half Of 2013

Dubai developer Nakheel announced that it made a net profit of Dhs1.2 billion in the first half of 2013, a 57 per cent increase compared to Dhs767 million in H1 2012.

The company attributed the profit rise to higher revenues, which rose to Dhs4.23 billion, up 36 per cent on Dhs3.1 billion in H1 2012. Revenues were up mainly because of the handover of properties and improved performance of Nakheel’s retail, leasing and leisure business units.

Nakheel delivered around 1,400 properties in H1 2013 and has handed over around 6,000 properties in total since agreeing to a $16 billion restructuring in August 2011.

Handovers have been mainly in residential developments in Palm Jumeirah, Al Furjan, International City, Jumeirah Village, Jumeirah Park and Jumeirah Heights communities.

The developer said it is on course to deliver an estimated 3,000 units in 2013.

“The strong results reflect the on-going support of the Dubai government and the commitment by Nakheel to delivering the post restructuring plan,” a company statement said.

“They also clearly demonstrate the continuing growth and strengthening of the real estate market in Dubai, and the return of investor confidence and trust in Nakheel and its projects.”

The developer said it is focussing on increasing its pool of “cash generating assets” and is currently evaluating a number of new projects. Some of the projects in its pipeline include Nakheel Mall and Hotel, The Pointe at Palm Jumeirah, the extension of Dragon Mart and Ibn Battuta Mall, and residential projects such as Palma Residences, Palm Views and Jumeirah Park.

State-owned Nakheel, whose debts triggered the 2009 debt crisis in Dubai, has Dhs8 billion worth of loans maturing in 2015.

The company, which made interest payments of Dhs206 million to bank lenders in Q1 2013, has paid over Dhs1.3 billion in loan interest and sukuk profit payments since August 2011.

It has also made cash payments of around Dhs11.3 billion to trade creditors and contractors since the restructuring began.