16/02/2018 05:39 AST
Union Properties, a leading real estate developer in the UAE, has reported a net loss of Dh2.3 billion ($626 million) for the 12 months ending December 31, 2017 (equivalent to Dh0.55 loss per share) compared to a net profit of Dh211 million in the corresponding period of last year.
Announcing the financial results for the 12 months ending December 31, 2017, Union Properties said the UAE real estate developer delivered revenues of Dh640 million in the 12 months ending December 31, 2017, compared with Dh960 million for the same period of 2016.
Total assets stood at Dh5.6 billion as of December 31, 2017, compared with Dh7.9 billion at the same time in the prior year. While shareholders' equity was Dh2.6 billion as of December 31, 2017, compared with Dh5 billion last year.
The Dubai developer said most of the losses recorded were related to Dh2.8 billion of provisions booked in the second quarter of 2017 for the re-assessment of some of the company's assets, which reflected the new management team's prudent approach to risk.
On the results, Chairman Nasser Butti Omair bin Yousef said: "Last year was a major turning point for Union Properties, where we successfully mapped out a comprehensive growth strategy spanning across our operations."
"We have worked internally to ensure they reflect the new growth directions we are heading towards. This enables us to enhance the efficiency of our operations, diversify our investment portfolio and expand our business by entering new markets to achieve long-term, sustainable growth. We look forward to further achievements in 2018 and beyond," he added.
During the second half, Union Properties achieved significant milestones such as unveiling the new master plan for Motor City and launching several new projects and subsidiary companies that will contribute to the long-term growth of the group.
"Our recent decisions such as selling our stake in Emicool and buying shares in Palm Hills will contribute towards strengthening our portfolio, expanding our operations and development projects as well as supporting our growth strategy," noted bin Yousef.
"This comes at a time where we seek to strengthen the group's efficiency and maximize its potential for opportunities in the UAE and around the world," he added.
In line with its strategy to further diversify operations and revenue sources, Union Properties also established two fully-owned subsidiary companies in the third quarter of 2017: Union Malls, which offers retail and leisure options in Union Properties developments, and Al Etihad Hotel Management, which develops and manages luxury hotels and furnished residences in Dubai.
In October, the Dubai developer set up a new investment arm, UPP Capital Investment, which comes within the framework of the real estate group's diversification strategy.
The new entity, a specialist in direct and indirect property investments, also provides in-house expertise to support Union Properties' long-term growth strategy, it added.
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