Damac posts first loss since 2010
Leading Dubai-based developer Damac Properties, reported on Tuesday a net loss of Dh36.9 million in 2019 - its first annual loss since 2010.
Damac, which owns the only Trump-brand golf course in the Middle East, posted a fourth quarter loss of Dh169.5 million compared with a Dh57 million profit in the corresponding 2018 period, according to calculations by analysts. In 2018, the developer made a net profit of Dh1.15 billion.
Damac's full-year revenue fell 28.2 per cent to Dh4.4 billion as the firm said it focused on handing over units to customers and developing existing projects.
In a statement, the developer said it had booked sales of Dh3.1 billion and delivered close to 4,700 units. Shareholders' equity stands at Dh14.1 billion while the firm's assets were valued at Dh23.8 billion. The company said it focused throughout 2019 on deliveries and execution of projects in the construction pipeline. The year marked the first deliveries in the master development Akoya alongside other projects in Dubai.
Hussain Sajwani, Chairman, Damac Properties, said in Dubai, the group's primary market, it maintained focus on completing and handing over units in the development pipeline.
"We have selectively launched fewer projects in softer market conditions to avoid adding new commitments and focus on selling completed and near completion inventory," said Sajwani, who last year called for a freeze on new residential projects for up to two years by developers in Dubai to facilitate a recovery in Dubai's troubled market.
Sajwani said Damac's cash and liquidity management remains of paramount importance for Damac, given the cyclical nature of the industry it operates in.
"We have historically paid for its land and debts commitments on or ahead of schedule. Damac continues to maintain a healthy financial and liquidity position and has reduced gross debt by Dh1.6 billion in last 18 months,'' he said.
"Thanks to the reform-oriented leadership of this country, the market is poised for a long-term upswing. From announcing long-term visas to boost demand, to the establishment of the Higher Committee for Real Estate to create a balance between supply and demand, government initiatives remain the key driver for the sector's growth," Damac chairman said.
"We look forward to 2020 as Dubai gears up to host the world for Expo 2020. The short- and long-term impact of this global event will undoubtedly boost all sections of the economy, which will have a positive impact on the real estate sector," said Sajwani.
Senior vice-president Niall McLoughlin said the results were affected by non-cash items including provisions for impairment on development properties and for "doubtful debts" worth Dh165 million. - email@example.com
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