DUBAI, 29 January 2006 — Emaar Properties, the world’s largest real estate firm in terms of market capitalization, yesterday boasted record profits of 4.731 billion dirhams ($1.289 billion) for 2005, up by 180 percent from the previous year.
The Dubai-based real estate giant, which has a market capitalization of more than $40 billion, announced “record annual profits of 4.731 billion dirhams for the year ended Dec. 31, 2005.” “This corresponds to a net profit increase of 3.040 billion dirhams or 180 percent. Net profit for fiscal year 2004 was 1.691 billion dirhams,” it said.
In 2005, “property revenues increased by ... 59 percent to 8.361 billion dirhams ($2.27 billion),” compared to the previous year, it said. “Significantly, the earnings per share increased to 0.85 dirhams per share for the year 2005 from 0.33 dirhams per share for the year 2004,” it said.
Emaar Chairman Mohamed Ali Alabbar said “to date, Emaar has handed over 12,800 homes to owners in Dubai and launched over 50 real estate projects across the region.” “We aim to build Emaar into the most valuable brand for the real estate sector globally,” he said.
Emaar’s regional expansion represents a total investment of more than 150 billion dirhams ($40.8 billion). The company lists the Dubai government as the largest of its 41,000 shareholders and boasts a $7.7-billion asset base.
When completed, Emaar’s Burj Dubai tower in Dubai will stand some 800 meters (2,500 feet) high, comfortably taller than any building currently standing in the world.
“This is of course much lower than expected,” said Mohamed Alami of Naeem Brokerage in Dubai. “People were expecting much more growth.”
The company’s shares sank 2.43 percent to close at 21.8 dirhams even though the results were released after the market closed. Traders said the market had been bracing for a disappointing outcome.
Dubai-based investment bank Shuaa Capital had forecast Emaar’s 2005 profit to reach 5.14 billion dirhams and traders told Reuters last week they were expecting the company to post profits exceeding 5 billion dirhams.
Analysts said Emaar’s weaker-than-expected performance could cause a ripple effect when the market reopens today. “We are expecting the shares to go down tomorrow and we expect the whole market to go down because Emaar is leading the market,” said Wadah Al Taha, head of research at National Bank of Abu Dhabi.