Dubai property giant Emaar reports 20% bump in profits

A logo of Dubai's Emaar Properties is seen on a building in Dubai, United Arab Emirates January 12, 2018. (Reuters)
Updated 10 November 2019

Dubai property giant Emaar reports 20% bump in profits

  • Emaar reported that over the first nine months of the year net profits rose just 2.3 percent to $1.2 billion

DUBAI: Dubai construction and hospitality giant Emaar Properties on Sunday reported a rise in interim profit results, posting higher sales despite an economic downturn that has depressed the property industry.
The company, which owns the world’s tallest tower, Burj Khalifa, said it posted $362 million in net profit in the third quarter, up 20 percent from $302.4 million in the same period last year.
Dubai is defined by its beachfront skyscrapers and man-made islands, but it is stuck in a five-year property downturn with analysts saying there will be no relief in the near term.
The government in 2018 introduced a raft of rescue measures including easy visa terms for expatriate buyers and permanent residency permits for big investors. And in September, a top-level committee was established to rebalance the market.
Emaar, the largest property firm in the Middle East, reported that over the first nine months of the year net profits rose just 2.3 percent to $1.2 billion, from $1.18 billion in the corresponding period of 2018.
Sales in the first three quarters of 2019 hit $3.44 billion, a surge of 25 percent on the same period last year.
The growth was attributed to the “resilient performance of the property, malls and hospitality business,” the company said in a statement posted on the Dubai Financial Market website.
Since 2002, Emaar has delivered some 59,000 residential units in Dubai and other global markets.
Besides real estate, Emaar has a number of malls, including Dubai Mall, the world’s most visited shopping center, and several hotels.

Virtual oil summit planned amid ongoing market volatility

Updated 04 April 2020

Virtual oil summit planned amid ongoing market volatility

  • Meeting follows call from Saudi Arabia for urgent meeting and telephone diplomacy between Kingdom, Russia and the US

DUBAI: Leaders of the global oil industry are planning a crucial “virtual” summit next Monday amid ongoing volatility in crude prices and falling energy demand.

The meeting follows a call from Saudi Arabia on Thursday for an urgent meeting and a round of telephone diplomacy last week involving the Kingdom, Russia and the US, as well as meetings between policymakers and oil industry executives.

The summit is expected to involve the 11 members of OPEC as well as other oil producers from the OPEC+ group.

But exactly which countries will take part in the summit was still up in the air last night. 

Russian President Vladimir Putin was holding talks with executives from the country’s major oil companies before deciding whether or not to participate. The Russian leader has previously indicated his willingness to get involved in talks to help resolve the crisis in the global energy industry, but Russia was also the country that refused to take part in a round of deeper production cuts proposed by Saudi Arabia in Vienna last month, sparking the current price war.

In response to that refusal, the Kingdom increased production and lowered its selling prices. On Sunday, Saudi Aramco, which has pushed output to a record 12.3 million barrels per day, is scheduled to announce its “official selling prices” (OSP) for the month of May, expected to show a continuation of the deep levels of discount to attract customers, especially in Asia, in the battle for global market share. 

Brent crude continued its rollercoaster ride on global markets on Friday, dipping nearly 5 percent before hitting a high of 17.5 percent up at $34.91, before paring gains to about $33.

The options for the producers at Monday’s meeting are limited, in the face of an unprecedented drop in global oil demand. By some estimates, more than 20 million barrels of daily demand was lost last month, the biggest ever contraction in oil history.

Saudi Arabia and Russia, which between them produce around 23 million barrels per day, are unlikely to be willing to take all the pain of bigger cuts without an offer from the Americans.

US President Donald Trump tweeted on Thursday that he expected between 10 million and 15 million barrels of oil to be taken out of supply, but he did not specify where this would come from. Meetings were expected to take place at the White House with oil industry executives and policymakers on Friday.

Daniel Yergin, Pulitzer Prize-winning oil expert, said: “The ‘when,’ ‘how’ and ‘who’ of the potential deal remain unclear. And the larger the universe of players the more difficult it will be to implement an agreement.”

OPEC+ consists of the 11 OPEC members, led by Saudi Arabia, plus 10 non-OPEC producers, of which Russia is by far the biggest.

The involvement of the US in the Monday meeting is also unclear. America is not an OPEC member, but US oil executives have attended OPEC deliberations in the past. American participation in any new rounds of output cuts will be constrained by the fact that the US oil industry is made up of private companies — as opposed to state-directed corporations — whose interests diverge.

While big players including Exxon Mobil and Chevron might be willing to take some advice from the White House, the smaller companies in the Texas shale fields are more focused on the immediate financial repercussions of the past month’s volatility.