Amlak Finance PJSC, a leading specialized real estate financier in the Middle East, has earned a group net profit of Dh87.4 million in the first of the current year (H1 2016), compared to Dh14.6 million for the same period last year.
Amlak says, in a press release, that the H1 results were supported by strong revenue growth in Q1 generated from one-off sale of land plots. Increased provisioning also impacted the results in Q2 caused by some customer accounts becoming delinquent as well as a general fall in real estate prices against mortgage assets giving rise to a reported net loss of Dh35.5 million in the second quarter of 2016.
Amlak’s total revenue reached Dh465 million in H1 2016 compared to Dh 214 million in H1 last year. The strong revenue performance was driven by income generated from the real estate investment business as the company registered Dh134 million from the partial sale of land projects in Q1 and Dh19.6 million in the 2nd quarter totalling Dh153.7 million in the first half of 2016. Revenue from financing business activity fell 29% in H1 2016 to Dh 104.6 million from Dh147.4 million for the same period last year due to a further decline in the real estate financing portfolio. Rental and other income and share of results from associates improved by 5% to Dh49 million compared to the same period last year.
The total assets of the group stood at just under Dh6.8 billion in H1 2016, representing a 2% decrease from the same period last year. On the back of net profits, shareholders equity improved to Dh1.63 billion from Dh1.58 billion at the end of December 2015.
“Our overall H1 profitability remains strong. We reported strong results in Q1. However, the second quarter’s operating performance was impacted by the higher than anticipated provisioning in Q2. We follow and strictly abide by a prudent provisioning policy to reduce balance-sheet risk and enhance financial reporting transparency to the highest levels, said Arif Alharmi, Managing Director of Amlak, while commenting on the results.
“Our long-term focus will firmly remain on growing our balance sheet and income from property financing which is a core business activity. We will also continue to enhance operational efficiency, risk management procedures and customer service. We will also remain committed pursue new sources of funding as a top priority in our strategic plan,” he added.
About Amlak Finance
Established in 2000, Amlak Finance was the first specialized home and real estate finance provider in the UAE. As an Islamic finance company, all Amlak business operates under the principles of Shari’a law.
Amlak offers ready and under construction property financing and as well as investor financing products and services. Amlak operates in Egypt and Saudi Arabia providing products and services in response to the local demand.
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