Emaar posts record third-quarter profits of AED 1.605 billion

Dubai, UAE, October 12, 2006: Global real estate major Emaar Properties PJSC has announced record revenue and net profits of AED 3.379 billion (US$ 0.920 billion) and AED 1.605 billion (US$ 0.437 billion), respectively, for the third quarter ended September 30, 2006. In annualized terms, this equates to an earnings per share (EPS) of AED 1.04, which is more than the 2005 EPS of AED 0.85. 

The third quarter 2006 figures represent a growth of 66 per cent in revenue and 39 per cent in profit respectively over the third quarter 2005 revenue and profit of AED 2.040 billion (US$ 0.555 billion) and AED 1.157 billion (US$ 0.315 billion)  respectively.

Revenue and net profit also grew 19 per cent and 4 per cent respectively over the second quarter 2006 revenue of AED 2.840 billion (US$ 0.773 billion) and profit of AED 1.536 billion (US$ 0.418 billion) . 

Revenue and net profits for the first three quarters ended September 30, 2006, are AED 8.458 billion (US$ 2.303 billion) and AED 4.658 billion (US$ 1.268 billion) respectively. This represents an increase of 25 per cent in revenue and 26 per cent in profit for the same period in 2005. The revenue and net profit for the three quarters ended September 30, 2005 were AED 6.757 billion (US$ 1.840 billion) and AED 3.690 billion (US$ 1.005 billion) respectively. 

The robust performance of Emaar was underscored by strategic local and regional expansion and international diversification initiatives. Apart from unveiling a number of new residential towers in its Dubai projects, Emaar reached out internationally with the acquisition of UK-based premier realtor Hamptons International and the Singapore-based educational provider Raffles Campus. Emaar also continued its regional expansion programme with the hosting of its first international sales in September for Emaar Pakistan’s first master-planned community, Canyon Views. 

“Emaar’s growth plans in the third-quarter of 2006 have been in line with the company’s strategic Vision 2010 of becoming one of the world’s most valuable companies,” said Mr Mohamed Ali Alabbar, Chairman, Emaar Properties. “While the acquisition of Hamptons International from Wheelock Properties (Singapore) Ltd in an all-cash deal worth AED 562.45 million (US$ 153.05 million) scaled up the company’s core competency of product sales, Emaar also underpinned its commitment to diversified business plans by acquiring Singapore-based Raffles Campus, to build its education subsidiary.”

Emaar moved in tandem with the vibrant economic growth of Dubai by aligning its mission and vision to develop the city as the hub of the region’s Knowledge Economy. “The direction of growth streamlined by UAE Vice President and Prime Minister and Ruler of Dubai His Highness Sheikh Mohammed Bin Rashid Al Maktoum for Dubai has also served as our model of growth. Emaar has been energized by his vision for the property market including the promulgation of the Dubai Property Law and confirmation of freehold areas in the emirate,” said Mr Alabbar.

The strong fundamentals of Emaar Properties were underpinned with Shuaa Capital in its Equity Research Update revising its definition of Emaar and reintroducing it as “a diversified, regional, large-scale real estate developer with growth targets of becoming a fully integrated property developer as well as provider of associated social and financial services on a commercial basis.” 

“For a public joint stock company (PJSC) like Emaar, such research reports highlight the effectiveness of the company’s forward-looking growth strategy and demonstrate its commitment to shareholders by enhancing investor confidence through value-added projects,” added Mr Alabbar.  

One of the high-points in Emaar’s third-quarter results was the success of its special sale of premium villas, which was an affirmation of local investor interest in Emaar’s prestigious communities. “Emaar also unveiled new residential towers in Dubai Marina and Downtown Burj Dubai – and investor response to all the projects has been encouraging,” said Mr Alabbar. 

Emaar’s iconic super-tower, the Burj Dubai which is billed to be world’s tallest upon completion in 2008, scaled 75 levels and continues to add one new floor every three to four days. The company also invigorated its customer services with the launch of the world’s first-of-its-kind facilities management and control centre - the Command Control Centre (CCC) - an advanced facility that monitors and enhances the efficiency of all electrical and mechanical services at Emaar’s various properties. 

In a significant regional accomplishment, Emaar the Economic City (Emaar.E.C), a consortium led by Emaar Properties and a number of high-profile investors in Saudi Arabia, received an overwhelming response to its initial public offering (IPO) with over 10 million people, approximately half the Saudi national population, applying for shares. Oversubscribed by 2.82 times, the SR 2.55 billion IPO received 2.8 million applications with the total amount subscribed at SR 7.18 billion. Net proceeds from the IPO will be used for the development of King Abdullah Economic City (KAEC), the largest private sector project in the Kingdom. Emaar.E.C is now listed on the Tadawul stock exchange.

Emaar opened its first international sales in Pakistan for the Mirador homes in Canyon Views, part of a PKR 145 billion (US$ 2.4 billion) development outlay by Emaar in Pakistan. 

In another landmark deal, Emaar won a 7-km strip of tourism resort land on Sidi Abdel Rahman and Alamein in Egypt’s north coast in a keenly contested bid for US$ 175 million (EGP 1 billion) from the Egyptian Government Tourism Company. Emaar is undertaking a prestigious EGP 10 billion (AED 6.30 billion / US$ 1.74 billion) mixed-use resort development – Marassi – on this 6.25 million sq metres of land. 

Earlier in the year, Emaar had acquired John Laing Homes, the second largest privately held homebuilder in the US. The AED 3.856 billion (US$ 1.050 billion) acquisition of John Laing Homes was funded from the proceeds of Emaar’s July 2005 rights issue, which doubled the capital of the company to AED 6.1 billion (US$ 1.66 billion). 

Emaar also signed a Memorandum of Understanding with His Majesty King Mohamed VI of Morocco to develop three landmark projects of development value AED 19.8 billion (US$ 5.39 billion). Emaar continues to embark on its international expansion plans with other projects, including master-planned communities, ongoing in Egypt, Syria, Morocco, Tunisia, Turkey, Pakistan and India.

Date: 12 October 2006