Dubai Holding Commercial Operations Group net profit increases 177% in 2013 to AED3.3 billion

Dubai Holding Commercial Operations Group net profit increases 177% in 2013 to AED3.3 billion

  • Total revenues increased by 27 % to AED11.6bn
  • Normalised EBITDA grew to AED5.5 billion
  • Estimated asset value of AED116 billion
  • Debt to equity ratio decreased to 0.6

"Dubai Holding, global investment holding company, today announced the financial results for its business group, Dubai Holding Commercial Operations Group (‘DHCOG’ or the ‘Group’), for the fiscal year ending 31 December 2013.

The Group continues to grow, delivering strong top and bottom line results. Net profits grew by 177 per cent to AED3.3 billion. During the year, total revenues reached AED11.6 billion, an increase of 27 per cent. Of these, recurring revenues stood at AED 6.9 billion, up 10.7 per cent. Normalised EBITDA grew to AED5.5 billion, while estimated total assets stood at AED116 billion.

Over the past few years, DHCOG has made it a priority to service, repay, or negotiate all its liabilities, and has generated sufficient liquidity to service these liabilities in a timely manner.

The Group has serviced all public and bank debts and repaid them upon maturity, negotiated settlements with contractors and made timely payments, and continued development of infrastructure and construction, to hand over completed units to its customers. This has resulted in reduction of these liabilities from AED36.7 billion in 2009 to AED19.2 billion in 2013.

DHCOG has made remarkable progress in managing its public and bank debts and has achieved an 8 per cent annual reduction from AED15.2 billion in 2009 to AED10.9 billion in 2013. The Group’s debt-to-equity ratio dropped from 1.04 in 2009 to 0.6 in 2013, well within the optimal range and industry norms."

Ahmad Bin Byat, Chief Executive Officer of Dubai Holding, said; “Over the past few years, DHCOG has focussed its efforts to ensure that we are able to meet our financial obligations when due. Our tough strategic decisions have paid off and in 2013 DHCOG tripled net profits, with its core commercial operations generating improved recurring and sustainable revenues. The Group continues to play a significant role in the development of Dubai’s cityscape bringing high quality residential, commercial and tourism infrastructure meeting the demands of a fast growing city.

“We are proud that our hospitality arm is one of the very few home-grown brands that have achieved significant success internationally. At the same time, it is also encouraging to see that international businesses continue to choose DHCOG’s platform of business parks to establish their base in the region. We will continue to deliver pivotal projects to address new market opportunities and ensure Dubai remains the Middle East’s primary business and tourism hub.”

DHCOG concluded the year with a healthy cash balance of AED3.9 billion. The Group’s consistently solid operating performance, strong cash flows, bond and debt repayments led Moody’s Investors Service to upgrade and assign a positive outlook to all of DHCOG’s ratings. "

"Operational highlights and outlook
DHCOG’s four businesses, which operate in 24 countries with 20,000 employees, are: Jumeirah Group (‘Jumeirah’), TECOM Investments (‘TECOM’), Dubai Properties Group (‘DPG’) and Emirates International Telecommunications (‘EIT’).

Dubai continues to be the foundation of Jumeirah’s business and a platform for future growth. Last year, Jumeirah started the construction of Madinat Jumeirah Phase IV, a 430 room resort development opposite Burj Al Arab, which is on track to be completed in 2016.

Jumeirah continued its international expansion with the opening of the Jumeirah Messilah Beach Hotel & Spa in Kuwait, making it the 22nd resort across 11 destinations in 10 countries of operations. Jumeirah also signed two important management contracts in Russia and Oman. At the same time, construction is also currently underway on three of Jumeirah’s five managed hotels in China and one in Bali.

Home to over 4,500 businesses, including major multinationals and many of the Fortune 500 companies that employ over 70,000 individuals,TECOM saw strong increase in overall commercial office occupancy.

In addition to providing a platform to businesses, TECOM is supporting Dubai in elevating the supply of skilled workforce through 400 educational programs offered by institutions based within TECOM’s business parks.

In 2013, His Highness Sheikh Mohammed Bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE and Ruler of Dubai, issued a decree, establishing Dubai Design District or “d3”, to strengthen Dubai’s position as a design and fashion capital. TECOM was entrusted to develop and operate d3, supporting enterprises within the value chain. The first phase of the business park is set to launch in 2015. TECOM also launched in5 Innovation Hub, an incubator that supports entrepreneurship."

"SmartCity Malta completed infrastructure for phase I and continues to build its first set of buildings, while construction has begun on the first building in SmartCity Kochi.

DPG made significant efforts in stabilising the business and capitalising on market opportunities.

DPG re-launched and made progress with key projects such as Bay Square, Mudon, Culture Village and Central Park.

DPG has already established itself as a strong player in the leasing business, with maximum occupancy rates of 99% achieved across its residential leasing portfolio of 25,000 units and 89% across its commercial portfolio of over 1.17 million square feet.

In 2013, DPG handed over more than 1,700 residential units and welcomed 23 million visitors to its destinations.

The underlying performance of EIT’s portfolio companies has been encouraging. Du continues to report unprecedented performance with improved revenues and net profit before royalties. Go, Axiom and Interoute delivered stable results while Tunisie Telecom achieved a better share of the mobile market, despite the market challenges. Overall, EIT continues to focus on managing its portfolio to create further value.

Ahmad Bin Byat concluded: “We remain committed to a number of Nation-building initiatives, we will continue to explore new investment opportunities that will further diversify our portfolio in line with our strategic objectives and ensure above market returns for our Shareholder.”

To view an infographic on DHCOG's performance, click here.


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