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Abu Dhabi, UAEWednesday 19 December 2018

Nakheel reports 5% rise in first quarter 2018 net profit

Net income for three months to the end of March 2018 climbed to Dh1.55bn

Nakheel’s stand at the Dubai Property Show in Mumbai in 2016 displaying a scale model of the Palm Jumeirah. Rebecca Bundhun / The National
Nakheel’s stand at the Dubai Property Show in Mumbai in 2016 displaying a scale model of the Palm Jumeirah. Rebecca Bundhun / The National

Dubai property developer Nakheel reported a 5 per cent increase in first-quarter net profit on the back of strong performance from its retail, hospitality and leasing portfolios.

The master developer of the palm-shaped islands off Dubai's coast said on Wednesday net income for three months to the end of March 2018 climbed to Dh1.55 billion, according to an emailed statement. The company did not provide other quarterly financial performance details.

“It has been an impressive start to 2018, with our first quarter results reflecting our ongoing delivery and diversification as per our business plan,” Nakheel chairman Ali Rashid Lootah, said. The company’s residential leasing, hospitality and retail business “continued to perform robustly,” he said.

The property market in Dubai is facing some headwinds with rental values and sale prices in some areas still under pressure. Analysts say the market is expected to turn the corner in 2018 as the government continues to spend on infrastructure in the run-up to hosting Expo2020 and the pace of economic growth picks up with the rebound in oil prices.

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The company has signed about Dh5bn in construction contracts since the start of the year, including a Dh4.2bn contract for Deira Mall and a Dh385 million contract for its first joint venture at Deira Islands.

The first three months of the year also saw significant construction progress at several of the company's residential, retail and hospitality projects, the company said.

The government-controlled developer reported a fourth-quarter net profit jump of 58 per cent to Dh1.67 and a 14 per cent rise in its full-year 2017 net income to Dh5.67bn. Nakheel attributed its improved profitability to its efforts to diversify its revenue streams.