Emaar Properties PJSC (DFM: EMAAR) has announced robust Q1 2023 financial results attributed to good property sales performance and operational excellence across its businesses.
Key Accomplishment Highlights
Emaar reported revenue of AED 6.3 billion (US$ 1.7 billion) in the first quarter of 2023, supported by increased tourism, retail sales and demand for real estate projects in Dubai. Emaar recorded an EBITDA and net profit for the first quarter of 2023 of AED 4.0 billion (US$ 1.1 billion) and AED 3.2 billion (US$ 873 million), respectively, which is an increase of 26 per cent and 43 per cent, respectively, compared to the first quarter to 2022.
In the first quarter of 2023, Emaar’s group property sales reached AED 9.2 billion (US$ 2.5 billion), an 11 per cent increase compared to Q1 2022. Emaar’s revenue backlog from property sales increased to AED 55.7 billion (US$ 15.2 billion), which will be recognised as revenue in the coming years.
Mohamed Alabbar, Founder of Emaar, said: “Emaar’s financial performance during the first quarter demonstrates our capability to continually enhance our performance through effective management of its operational efficiencies. As a direct consequence of our enhanced capacity to scale our operations, we have seen both an increase in EBITDA and a widening of margins. Owing to Emaar’s unwavering commitment to innovation, talent and operational excellence, the company is in a position to increase sales, lift profitability, and drive customers happiness and shareholders value.”
UAE Build-To-Sell Property Development
Emaar Development PJSC (DFM: EMAARDEV), a majority-owned subsidiary of Emaar, has recorded property sales of AED 8.6 billion (US$ 2.3 billion) in the first quarter of 2023, a growth of 26 per cent compared to the first quarter of 2022. Emaar’s property development revenue in UAE amounted to AED 3.6 billion (US$ 970 million) in the first quarter of 2023. We successfully launched seven new projects in the UAE during Q1 2023.
During the first quarter of 2023, international real estate operations of Emaar achieved property sales of AED 627 million (US$ 171 million) and generated revenue of AED 420 million (US$ 114 million), representing 7 per cent of Emaar’s overall revenue. The financial results of our international operations were primarily driven by the profitable operations in Egypt.
Shopping Mall, Retail and Commercial Leasing
Shopping mall, retail and commercial leasing operations saw a 7 per cent increase in revenue for Q1 2023 compared to the same period in the prior year, reaching AED 1.4 billion (US$ 388 million). Emaar recorded an EBITDA of AED 1.7 billion (US$ 474 million) from its shopping mall, retail and commercial leasing portfolio in the first quarter of 2023, representing an increase of 114 per cent from the same period in 2022. This achievement is attributed to recognising the gain on sale of Namshi of AED 700 million (US$ 191 million) and improved operational profitability complimented by high levels of tenant sales which grew by around 30 per cent compared to Q1 2022. Prime mall assets managed by Emaar Malls Management have reported an occupancy rate of over 95 per cent.
Hospitality, Leisure, and Entertainment
Emaar’s hospitality, leisure and entertainment businesses recorded a revenue of AED 884 million (US$ 241 million) in Q1 2023, reflecting a growth of 17 per cent compared to Q1 2022. This performance was the result of the continuing rebound in tourism and high domestic spending. The hotels in UAE under the Hospitality arm of Emaar, including managed hotels, achieved average occupancy of 75 per cent during the first quarter of 2023.
Emaar’s diversified portfolio of recurring revenue-generating businesses, including malls, hospitality, leisure, entertainment, and leasing, collectively recorded AED 2.3 billion (US$ 629 million) in revenue during Q1 2023, representing an increase of 11 per cent compared to Q1 2022. Revenues from these businesses constitute 37% of Emaar’s overall revenue.