Nakheel’s First Half Net Profit Up 54% To Dhs1.85bn

Dubai developer Nakheel posted a net profit of Dhs1.85 billion in the first half of this year, up 54 per cent compared to Dhs1.2 billion in H1 2013, it said in a statement on Wednesday.

Strong revenue from property development along with improving performance in Nakheel’s retail, leasing and leisure businesses contributed to these results, the company said.

The property firm’s positive first half-year result follows a recent announcement to prepay all of its Dhs7.9 billion bank debt in August – nearly four years ahead of schedule.

Nakheel handed over 627 units to customers in the first half of this year while the retail and leasing businesses witnessed almost full occupancy of the available units for lease.

The government-owned firm said earlier this year that it is planning to invest almost Dhs12 billion in new retail and leasing projects.

Nakheel’s leisure business also saw an improved performance on previous years, the statement said without giving further details.

“These robust financial results reflect the growth witnessed in the real estate sector in Dubai, where Nakheel continues to play a strategic role,” said Ali Rashid Lootah, chairman of Nakheel.

“Since the financial year ending 2010, Nakheel has reported a year-on-year increase in net profit. Our financial performance reflects the strength of the underlying business, increasing investor trust and confidence in Nakheel and the on-going support of the government of Dubai.”

The firm also announced strong first quarter results, with profits up 28 per cent to reach Dhs629 million.

Nakheel is currently developing a range of new projects in the residential, retail, leasing and hospitality sectors.

Retail projects include Nakheel Mall, The Pointe, Deira Islands Mall, Deira Islands Night Souk along with extensions to Dragon Mart and Ibn Battuta, community retail centres at Jumeirah Park, Al Furjan, International City, Discovery Gardens and Badrah.

It is developing residential and retail leasing units at Warsan Village and a new community of 1,000 villas.

Nakheel is also ramping up its leisure portfolio with plans to to build 10 hotels ranging from five star luxury establishments to simpler, budget-style accommodation over the next five years. Among them are The Palm Tower on Palm Jumeirah, several establishments at Deira Islands and hotels at Dragon Mart and Ibn Battuta.

Nakheel’s Palma Residences complex on Palm Jumeirah, Dragon Mart phase two, community centres at Discovery Gardens and Jumeirah Park and a three star hotel at Dragon Mart are due for completion this year, the firm said.

“With the bank debt repaid ahead of time and new cash generating assets coming on stream, Nakheel is well on course to further strengthen its business and financial position going forward,” Lootah said.