By Ben Roberts www.constructionweekonline.com
Emaar Properties, the Dubai developer, yesterday reversed its decision not to pay a dividend for 2010 by agreeing to pay 10% of the company’s share value.
In an annual general meeting on Monday Mohammed Alabbar, chairman of the company behind the Burj Khalifa, suggested a change to the proposal to cancel a dividend to pay around 8.2% of share capital, according to minutes of the meeting. After considering its ability to meet other financial obligations, the board agreed on a 10%-of-share-value limit.
Emaar cancelled its dividend for 2009 after the equivalent meeting a year ago. Last year net operating profits last year increased by nearly a third against 2009, the revenue increasing by almost half, as it handed over 3,500 units, including 770 in the Burj Khalifa.
Newswires report a heated discussion between the company and its shareholders, with investors initially demanding 30% in cash. Alabbar argued that the amount they were demanding would compromise the cash position it needs to maintain with creditors.
Emaar Properties saw net operating profits rise by nearly a third against 2009, with revenues increasing by almost half, although its fourth quarter results missed the average earnings forecast by a series of analysts compiled by Bloomberg. Fourth quarter revenues rose against the third quarter by 38% to AED3.83billion.
Recurring income from malls, retail and hospitality made a significant contribution to the real estate company’s top line as revenues rose 44% to AED12.15billion, up from AED8.413billion.
After-tax operating profits rose 31% to AED3.03billion against AED2.324billion in 2009, with the fourth quarter gaining marginally against the third. But net income fell 62% to AED 274 million from AED 720 million a year earlier.
A $500 million bond listed on the Luxembourg Stock Exchange was heavily over subscribed last year.
The company’s shares were trading at their highest level for six weeks just before midday on Tuesday, rising 2.5% from its opening price to AED 3.26.
Meanwhile, Al Hassan Engineering, the Omani contractor, said it would pay a dividend of 15% of the company’s paid-up capital, following the conclusion of its annual general meeting.