Emaar's earnings are better than expected as the developer of the world's tallest tower profited from its mall and hotel businesses.
Emaar gets a boost from malls and hotels
Emaar reported earnings that were better than expected yesterday as the developer of the world's tallest tower profited from its mall and hotel businesses. That positive momentum is likely to continue this quarter as the region's largest property company begins to book handover payments on the Burj Khalifa and its surrounding downtown development of flats, hotels and shops. Revenues from the firm's foreign ventures will start to come through this year, with delivery of projects in India, Egypt and Saudi Arabia.
Emaar posted a fourth-quarter net profit of Dh720 million (US$196m), up from a net loss of Dh2.43 billion for the same period in 2008. The company's earnings suffered last year as property prices fell and its US unit, John Laing Homes, became one of the most high-profile casualties of the American property slump when it filed for bankruptcy. "If they hadn't taken an impairment on their US business earlier in the year, the figures would have been stronger," said Majed Azzam, a property analyst at Al Futtaim HC Securities. Mr Azzam added that the firm's exposure to the retail and tourism sectors could help it achieve stronger profits this year, despite a weak property market.
"Emaar's exposure now is mainly tourism and retail," he said. "We're also going to see stronger results from international ventures, as they will deliver them more aggressively." Last year, Emaar opened two new hotels in Dubai: The Address Dubai Mall and The Address Dubai Marina. Meanwhile Dubai Mall, one of the world's largest shopping centres, attracted 37 million visitors in its first year of operation.
Last month, the company opened Burj Khalifa, part of the Dh73.4bn Downtown development. Mohamed Alabbar, the chairman of Emaar, said that while Dubai would remain an integral part of the developer's plans, the company would increasingly focus on middle-income housing in emerging markets for future growth. @Email:agiuffrida@the national.ae