Dubai real estate giant Nakheel posts surge in profits
Dubai's Nakheel real estate giant, hit badly during the global debt crisis, said Wednesday its profits surged 54 percent in the first half of 2014 to reach $502.7 million, AFP reported.
The government-owned entity, which built Dubai's palm-shaped island and a cluster of isles in the form of a world map, said its net profits hit 1.85 billion dirham ($502.7 million), compared to 1.2 billion dirham in the first six months of 2013.
It said strong revenues from property development as well as improving performance in retail, leasing and leisure businesses contributed to the results.
"These robust financial results reflect the growth witnessed in the real estate sector in Dubai," said Nakheel's chairman Ali Rashid Lootah.
The company that was fully acquired by the government over its debt woes said last month it will repay all remaining bank debts of $2.15 billion in August, ahead of schedule.
Nakheel had piled up a mountain of debt during five years of rapid growth in Dubai's property sector, before the global financial crisis hit the Gulf emirate in 2009.
The company was part of the government-linked Dubai World group, which sent jitters in global markets when it signalled in autumn 2009 that it was facing difficulties paying off debts totalling around $24.9 billion.
The government intervened to buoy the group, bolstered by $20 billion in aid from neighbouring oil-rich Abu Dhabi.
As part of the restructuring of Nakheel, the government injected $9.5 billion converted into equity, separating the company from Dubai World and becoming fully owned by the government.
Economic growth in Dubai has been steady thanks to the trade, transport and tourism sectors after contracting 2.9 percent in 2009. The property sector is also recovering after taking a nosedive during the crisis.