Dubai's Emaar Q2 profits up 29%, despite property sales dropping

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(AFP/Getty Images)

(AFP/Getty Images)

Dubai's largest developer Emaar Properties reported a 28.6 percent rise in second-quarter net profit on Monday, marginally beating forecasts, but revenue from property sales in the emirate dropped.

The builder of the world's tallest tower Burj Khalifa made a net profit of AED868 million ($236.3 million) in the three months ending June 30, compared with AED675 million a year before, it said in a statement to Dubai's bourse.

The outcome beat an average forecast of AED839.8 million for the period.

Emaar's earnings are seen as an key indicator for Dubai's real estate market, which has recovered in the last two years after collapsing following the global economic crisis in 2008.

However, renewed speculative buying and new project announcements have pushed up prices, making them unaffordable to many and thus slowing sales, raising fears of another property market bubble.

Property consultant JLL said in its latest report that there had been a marked slowdown in the volume of residential sales in Dubai in the second quarter.

Emaar sold properties in Dubai worth AED3.12 billion during the quarter, down from AED3.29 billion in the same quarter last year, Reuters calculations showed, based on half-year figures.

The company's revenue for the quarter dropped to AED2.81 billion from AED3.11 billion, the statement said. But revenue from its malls, retail and hospitality business grew by 12 percent.

Emaar Malls Group, a division of Emaar Properties, will look to sell a quarter of its shares to the public on the Dubai stock market when it lists later this year.

Shares of Emaar ended 3 percent up, before the announcement of the results.

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