DUBAI Jan 8 Dubai's DAMAC Properties
expects to maintain its 25 percent cash dividend policy for 2016
despite profit declines in the first three quarters, its group
chief financial officer said on Sunday.
The developer's board set a minimum 25 percent cash dividend
target in 2014 for the following two years. The board followed
the recommendation in 2015, however, is yet to announce a
dividend for 2016.
"There is no reason to speculate we will not adhere to
this," Adil Taqi told Reuters at DAMAC's headquarters in Dubai,
adding that it would be unlikely to be more than the target and
would require regulatory approval.
Profit at DAMAC, which is building a $6 billion golf complex
with Donald Trump, fell 23 percent to 2.84 billion dirhams
($773.23 million) in the nine months to September, according to
Dubai's property market, where DAMAC's business is
concentrated, has softened over the past two years as buyers
became more cautious amid weaker oil prices and cuts to regional
The market is likely to move "sideways" in 2017 compared
with 2016, when the company expects to reach around 7 billion
dirhams in sales, Taqi said.
"I don't envisage huge growth."
The majority of buyers in 2017 will continue to be from the
Gulf Arab region, wider Middle East and India, sales to Chinese
investors look set to grow though Western Europe "might not be
so important" due to a weak pound, he added.
DAMAC expects Dubai's market to rebound in the "second or
third quarter of 2019" in the lead up to the Expo 2020 world's
fair the emirate is set to host.
"I think this will be phenomenal for Dubai," Taqi said.
He also said DAMAC was considering its options for
refinancing debt maturing over the next two years, including a
$100 million sukuk in March, of which it has already paid off
$25 million, and $650 million sukuk in 2019.
($1 = 3.6729 UAE dirham)
(Reporting by Alexander Cornwell; Editing by Alison Williams)