Al Mazaya profits surge by 117% to Dhs351m in H1 2008

Earnings per share (EPS) reached 90 fils against the 49 fils reported in the first half of 2007.

The company posted a profit of Dhs172m for the second quarter of 2008, also up 55% as compared to the Dhs111m reported for the same period in 2007.

Following a board meeting held at the company's headquarters yesterday afternoon, which was attended by Al Mazaya Chairman, Rashid Al Nafisi, Executive Manager and CEO, Eng. Khalid Esbaitah, and Board members Omar Al Quoka, Fahad Al Ibrahim and Nasser Al Attar, Eng Esbaitah said,

"The company's profits continue to increase on a balanced average, with a continuous growth in the investments and projects that Al Mazaya is executing locally and regionally."

Esbaitah added that the company's projects and investments were carried out in accordance with a five year plan. These investments are starting to bear fruit as the current projects reach advanced stages. The DIFC-based Sky Gardeners residential project has contributed significantly to this leap, after the luxurious tower was completed and sold to UAE firm, Amlak. Sky Gardens, a project of First Dubai Real Estate Development Company, a 77.85%-owned subsidiary of Al Mazaya Holding, was sold to Amlak at a profit of Dhs999m, Dhs652m of which went to Al Mazaya. The company intends to include Dhs361m from the amount in the current year's budget, while the remaining Dhs291m will be transferred to the budget for next year.

Esbaitah said that the Sky Gardens tower is an embodiment of the recent series of successes achieved by Al Mazaya, adding that the company's profits this year will include other projects such as Queue point in Al Liwan, the Dhs2.1bn middle income groups project, already 90% sold and expected to yield a return of Dhs694m, which will be included as per progress. Construction is underway at Queue point, and it is scheduled for handover by end of 2009, and profits will therefore be included in the 2009 financial results. Business Avenue Towers and the "Icon Towers" residential project in Jumeirah Development have already sold out, with profits to be included in the 2008 and 2009 financial results. Construction work has been completed on "Icon Towers", while substantial progress has been made on Business Avenue Towers.

Esbaitah went on to say that Al Mazaya has expanded its lucrative investments and increased its real estate assets in Dubai through acquiring the Al Mazaya flagship tower, a 60-storey state-of-the-art iconic office tower on Sheikh Zayed Road, and a 28-storey building in Downtown Jebel Ali, set to attract financial institutions and prominent companies. Both projects are planned for long term investment in the rental market, with over 12% annual ROI. Al Mazaya has also sought to increase its Kuwait assets by retaining one luxurious tower under development in Kuwait Business Town, and its two landmark projects in Kuwait's Shuwaikh Industrial Area, namely "Seven Zones", and the BOT project, Mazaya Health Clinic.

Esbaitah said that Al Mazaya's strategic plan was developed according to sophisticated calculations to guarantee a balanced and continuous growth in shareholders' profits and to protect the company from risks. The company has developed a significant portfolio of diverse mega projects which ensure balanced growth and stable returns for a minimum of five years to come.

According to Esbaitah, the company has also made other important strides toward achieving horizontal expansion and diversifying investments to take a sizable portion of the ongoing real estate boom in the GCC countries. Al Mazaya has launched two residential projects in Oman, a commercial project on the prestigious Bahrain Financial Harbour, and a mega residential project in Al Ahsa, KSA. Mazaya Qatar and Mazaya Saudi, two real estate subsidiaries of Al Mazaya Holding, were established in Qatar and KSA, respectively, in a move of tremendous progress that will translate into additional returns to boost the company's financial position over the coming few years. The expansion plan has been accompanied by the establishment and management of investment portfolio and funds, such as the 50% stake of the $100m Al Madar Fund, recently stated to be generating excellent returns, and the $15m Al Mazaya Investment Portfolio, with returns expected in 2009.

Esbaitah added that Al Mazaya has a lot of real estate and investment projects coming up, with particular focus on Dubai, where the company has acquired nine multi-purpose plots of land in Downtown Jebel Ali. "In Kuwait, Al Mazaya is keen to achieve His Highness the Amir Sheikh Sabah Al-Ahmad Al-Jaber Al-Sabah's aspiration to turn Kuwait into a commercial and financial center, and to realize this vision on the ground through its initiatives to launch "Neira Financial Centre" and "Yammar Heritage Village"," he concluded.