(MENAFN- Khaleej Times) Nakheel Properties said on Monday that its first-half profits jumped 37 per cent on the back of a surge in property deliveries in several projects.
Nakheel, which completed a protracted Dh59 billion debt restructuring in August 2011, said net profit surged 36.5 per cent to Dh767 million in the first six months of the year, from Dh562 million in the same 2011 period.
In a statement, the master developer said that its first-half revenues rose to Dh3.1 billion, up 112 per cent from the same period a year ago. As part of the debt-restructuring plan agreed, Nakheel, builder of man-made islands in the shape of palms and a map of the world, has made cash payments of about Dh8.6 billion to trade creditors.
The company, which was brought under direct government control as part of the restructuring of its parent Dubai World, said about 3,500 units have been delivered since the start of the restructuring in several developments, mainly Palm Jumeirah, Jumeirah Village, International City, Al Furjan and Jumeirah Heights.
Retail and leasing activities also contributed positively to the results. "Nakheel gained favourably from the various operating income segments that continue to be the core area of focus. Effective cost control measures implemented by Nakheel resulted in overheads sustaining at the reduced levels of 2011," the statement said.
"The financial performance is reflective of the continuous support and commitment made by the Government of Dubai and the board of directors of Nakheel to implement a sustainable business strategy for the medium to long term and largely due to better cost and cash management. The positive results of 2012 first half following from the robust financial results achieved in the year 2011 are reflective of the strong growth in the real estate market in Dubai where Nakheel is a dominant player and will continue to strengthen its position with the passage of time," the developer said. Nakheel said it could conclude its restructuring with the issuance of a Sukuk of Dh3.8 billion to the eligible trade creditors and did a subsequent tap issuance of Dh227 million in April 2012 as part of its overall Sukuk programme. Interest and profit payments amounting to Dh500 million have been released to the lenders since the completion of the restructuring.
"Vendor commitments are being settled on a timely basis thus complementing the delivery of the projects resulting in a reduction in vendor liabilities. Nakheel has made cash payments of Dh8.6 billion to its trade creditors since the commencement of the restructuring. The consolidation of the existing customer liabilities has progressed well with Nakheel managing to amicably reduce long-term customer liabilities by Dh 7.2 billion out of a total customer liabilities of Dh 9.9 billion through various consolidation and swap schemes offered to its customers," it said.
The developer said the robust financial performance is reflective of its focus on contributing to the recovery of the Dubai real estate market.
"Nakheel has recommenced all its near term projects and started delivering properties as scheduled. Most of the properties currently under construction are expected to be handed over to customer by the first quarter 2013," it said.
"Nakheel is proactively evaluating and assessing various development projects that are expected to be implemented in the subsequent periods in the company's quest to deliver sustainable communities. The recently launched Palma Residences and Palm Views projects in Palm Jumeirah have been well received in the market," the statement said.
"The strong performance of retail and hospitality sector is reflective of the growth in the economy of Dubai and the investor's trust and confidence in Dubai. Additional projects in the pipeline in this sector include The Palm Mall and the Pointe on the iconic Palm Jumeirah development, the extension of the Ibn Battuta Mall and the construction of the community centres at Jumeirah Park and the Discovery Gardens, popular residential communities by Nakheel," it said.
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