Dubai’s Emaar Properties Q2 net profit rises 16%

Dubai’s Emaar Properties, builder of the world’s tallest tower, reported a 16 per cent rise in second-quarter net profit on Sunday as other income increased and it received more money in income tax credits.

The developer, in which Dubai’s government owns a minority stake, made a net profit of Dhs 1.18bn ($321.3m) in the three months to June 30, up from Dhs 1.02bn on the prior-year period, Emaar said in a statement.

SICO Bahrain had forecast Emaar’s second-quarter profit would be Dhs 817m.

The developer has now reported rising profits in nine straight quarters and achieved its latest increase despite relatively sluggish revenue growth and with analysts noting a marked slowdown in Dubai’s recently resurgent property sector.

Emaar’s second-quarter revenue was Dhs 3.48bn, up from Dhs 3.34bn a year earlier. Cost of revenue rose 11 per cent to Dhs 1.63bn.

The firm’s other income swung to a gain of 144 million dirhams from a small loss a year ago and it also received income tax credits of Dhs 90m versus Dhs 6m in the second quarter of 2014.

For the first half of this year, Emaar’s net profit rose 12 per cent to Dhs 2.21bn as revenue increased 13 per cent to Dhs 6.50bn.

Emaar generated 6.12bn in Dubai property sales in the first half of 2015.

It did not provide a comparative figure for the same period of last year, but consultants have noted a substantial slowdown in the emirate’s property sector.

Home sales shrank by about two-thirds in the first half of 2015, and prices also slipped, with further declines expected over the rest of the year, property consultants JLL said in a report last week.