Bloomberg the Company & Products

Bloomberg Anywhere Login

Bloomberg

Connecting decision makers to a dynamic network of information, people and ideas, Bloomberg quickly and accurately delivers business and financial information, news and insight around the world.

Company

Financial Products

Enterprise Products

Media

Customer Support

  • Americas

    +1 212 318 2000

  • Europe, Middle East, & Africa

    +44 20 7330 7500

  • Asia Pacific

    +65 6212 1000

Communications

Industry Products

Media Services

Follow Us

Emaar Retreats as Dividend Proposal Disappoints: Dubai Mover

March 20 (Bloomberg) -- Emaar Properties PJSC retreated the most in two weeks after a 10 fils cash dividend for 2011 proposed by the board of the United Arab Emirates’ biggest developer fell short of investor expectations.

Emaar, developer of the world’s tallest tower in Dubai, slumped 2.6 percent, the most since March 7, to 2.97 dirhams at the 2 p.m. close in the emirate. The decline dragged Dubai’s DFM General Index 1.5 percent lower to 1,643.31. Emaar also paid a 10 fils dividend for 2010 after it hadn’t initially proposed one. That decision was made after a heated three-hour meeting between shareholders and executives.

“There were speculations about dividend as high as 15 fils,” said Dubai-based Fadi Al Said, who oversees $250 million as senior investment manager at ING Investment Management for the Middle East and North Africa. “Since the company maintained the dividend, it may be a positive sign that it’s comfortable with its financial position.”

Emaar, owned 31 percent by Dubai’s government, didn’t distribute dividends in 2009 and 2008, according to data compiled by Bloomberg. Its profit plunged 89 percent and 54 percent those years, respectively, as the company that derives more than 90 percent of revenue domestically suffered when Dubai’s real-estate crash dragged home prices down 65 percent from a mid-2008 peak.

Profit Doubles

The developer said last month its fourth-quarter profit more than doubled to 716 million dirhams ($195 million), beating analysts’ estimates. Recurring income from hotels and malls grew to 41 percent of revenue last year compared with 24 percent in 2010.

The shareholders are scheduled to meet on April 23 to discuss the dividend proposal, the company said in a statement to the Dubai Financial Market today. Emaar said yesterday that it may expand its board to 11 members from eight and replace four directors.

Emaar’s shares have gained 16 percent this year compared with a 21 percent advance for the benchmark Dubai Financial Market General Index. Fifteen analysts recommend investors buy Emaar shares, two have a hold rating and one a sell recommendation, according to data compiled by Bloomberg.

To contact the reporters on this story: Zainab Fattah in Dubai at zfattah@bloomberg.net; Zahra Hankir in Dubai at zhankir@bloomberg.net

To contact the editor responsible for this story: Claudia Maedler at cmaedler@bloomberg.net

Please upgrade your Browser

Your browser is out-of-date. Please download one of these excellent browsers:

Chrome, Firefox, Safari, Opera or Internet Explorer.