Emaar Properties Q4 profit near-flat after Address hotel fire write-down

Emaar makes a write-down of $82 million after fire at the Address Downtown hotel, which had the most expensive average daily rate and highest occupancy in the first nine months of 2015

Dubai's Emaar Properties, builder of the world's tallest tower, reported near-flat quarterly net profit on Wednesday after taking a write-down related to a fire at one of its hotels on New Year's Eve.

The 301 million dirham ($82 million) write-down stalled an earnings boom at the government-linked developer, which had reported rising net income in the preceding 10 quarters.

Emaar made a net profit of 1.03 billion dirhams in the three months to Dec. 31, down from 1.05 billion dirhams a year earlier, a bourse statement said.

An analyst at SICO Bahrain had forecast Emaar's fourth-quarter profit would be 1.08 billion dirhams.

The write-down related to the fire at the Address Downtown hotel. Previous company documents show that, of the six Emaar hotels for which it provided a detailed breakdown, the Address Downtown commanded the most expensive average daily rate and highest occupancy in the first nine months of 2015.

Emaar said that accounting rules required it to recognise the write-off in the year the loss occurred, but it can record subsequent insurance payouts as income.

"The hotel is completely insured and the company is confident of recovery of loss from the insurance," Emaar said.

Its hospitality and leisure unit's annual revenue was 1.67 billion dirhams, accounting for 12 percent of the company's total revenue of 13.67 billion dirhams.

The company also restated its 2014 results following its adoption of new accounting standards. This increased its 2014 fourth-quarter profit by about 20 percent from 861 million dirhams previously.

Emaar's quarterly revenue was 3.81 billion dirhams, against 2.41 billion a year earlier.

The developer's 2015 profit was 4.08 billion dirhams, up from 3.67 billion dirhams in 2014.

Related:
Join the Discussion

Disclaimer:The view expressed here by our readers are not necessarily shared by Arabian Business, its employees, sponsors or its advertisers.

Please post responsibly. Commenter Rules

  • No comments yet, be the first!

All comments are subject to approval before appearing

Further reading

Features & Analysis
Forgotten fees: the challenge of investing in Dubai property

Forgotten fees: the challenge of investing in Dubai property

Investors attracted to low service charges at some Dubai residential...

3
Dubai real estate: which way will it go?

Dubai real estate: which way will it go?

In this special report, Arabian Business analyses the state of...

1
Diving for answers: What's happened to Dubai Pearl?

Diving for answers: What's happened to Dubai Pearl?

The mysterious inability of a $6bn mega-project on prime land...

9
Most Discussed
sponsoredTracking