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DAMAC aims to reduce debt to $1.3bn - CFO

DAMAC aims to reduce debt to $1.3bn - CFO
Taqi also stressed that cancellations and defaulting rates are below 5%
Damac
DAMAC
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By: Amr Adel

Dubai – Mubasher: DAMAC Properties aims at reducing the current debt level from $1.4 billion (AED 5.1 billion) to $1.3 billion (AED 4.7 billion) by the end of 2017.

The debt volume is less than half of the equity, which affirms the company’s financial viability, the company’s chief finance officer (CFO), Adil Taqi said on Monday.

The total equity amounted to $3.5 billion (AED 13 billion) by the end of the first half of 2017, while debts, including loans, Sukuk and other liabilities, have reached $1.4 billion (AED 5.1 billion), Taqi added.

The company’s situation is good in terms of liquidity, which amounts to $2.3 billion (AED 8.6 billion), DAMAC’s CFO said, noting that the liquidity is ready for financing the current project of the company.

The CFO expects that the debt collection rate will grow to $1.6 billion (AED 5.9 billion) in the end of 2017 from $1.4 billion (AED 5.1 billion) in 2016.

Taqi also stressed that cancellations and defaulting rates are below 5%.

Taqi stated that the company will deliver 5,500 units to customers within 18 months, from July 2017 to the end of 2018 and targets the delivery of other 2,800 units in 2017.

DAMAC has already delivered 1,100 residential units in its DAMAC Hills project during H1-17, and expects to deliver the remaining units in the remaining months of 2017, DAMAC’s Group CFO told Mubasher.

DAMAC had completed the delivery of 19,000 units across its portfolio of projects until the end of June, with some 44,000 units still underway at various stages of development, he added.

The top official told Mubasher that DAMAC currently doesn’t plan to issue new Sukuk because it has the required liquidity to fund its projects.

When asked about the real estate sector in the UAE, Adil Taqi said that it is one of the growing sectors in the market. However; he did not expect a major growth in the real estate sector in Dubai this year.

The CFO praised the role played by the Real Estate Regulatory Authority (RERA), namely monitoring offers and payment plans provided by real estate development companies in Dubai for the sake of commitment assurance.

 

Translated by: Muhammad Abdulwakeel