Amlak Finance, a leading specialised Islamic real estate financier in the Middle East, has reported a net loss of Dh272 million ($74 million) for the full-year 2018 compared to Dh51 million ($14 million) net profit the previous year.

Announcing the results for the year ended December 31, 2018, Amlak said it had recorded a 16 per cent increase in its revenue for 2018 from sale of properties under development compared
to the previous year.

This increase was mainly related to the infrastructure development completion and sales of plots in
Nad Al Hamar project, it stated.

Amlak said the revenues from financing business activities fell nine per cent to Dh173 million from Dh191 million in 2017.

The company’s total revenues including unrealized fair value loss related to investment properties plunged to Dh307 million in 2018, down by 29 per cent from Dh432 million in 2017; a decrease due to a more conservative approach in assets valuation.

Operating costs increased by 17 per cent to Dh146 million in 2018, compared to Dh125 million in
2017, including operating costs of joint ventures relating to real estate development.

Meanwhile Amlak's rental income increased by 5 per cent during 2018 to Dh64 million, compared to Dh61 million in 2017.

An increase mainly due to a one-off expenses related to renegotiation of existing restructuring terms and litigation expenses.

During 2018, the Group recorded an impairment charge of Dh206 million compared to an
impairment reversal of Dh0.4 million for 2017. This is mainly related to advances paid towards
the acquisition of units in two under-development real estate projects, said the Emirati real estate firm.

The profit distributable to financers stood at Dh112 million for 2018, a decrease of 10 per cent
compared to Dh125 million for 2017. This decrease is due to the early payment made to
financiers in January 2018.

Commenting on the results, Chairman Ali Ibrahim Mohammed said: "It had been a challenging year for the real estate sector in the UAE and across the region. The on-going global trade concerns, fluctuating oil prices and softening of the real estate market has had an adverse impact on investors’ sentiment."

"Despite these challenging circumstances, Amlak has and will continue to identify the right kind of opportunities that can co-exist with the changing environment focusing on our strategy and steering the company through new market realities," stated Mohammed.

"We have worked closely with all our stakeholders and are pleased with the execution and implementation of our projects. With a more positive outlook for the market anticipated for
2019 and beyond, we have put in place clear strategies to ensure maximum value for our
shareholders, providing leading customer service, nurturing our employees as well as fulfilling our
Corporate Social Responsibility (CSR)," he added.

Managing Director and CEO Arif Abdulla Alharmi said: "While investors’ sentiment in
the real estate market has dampened due to economic uncertainty, the UAE government has
announced a number of new initiatives to improve the overall market sentiment and provide
tangible returns to investors."

"Aligned with these initiatives and despite the challenging property market, Amlak continued to provide our customers with innovative products and services that stimulate the local market," noted Alharmi.

"In 2018, Amlak faced a loss due to increased impairment driven by the adoption of a more prudent approach in valuing real estate assets, however, we were able to complete some key infrastructure projects including the sales of plots in Nad Al Hamar project which is a testament to our commitment and position in the market," he added.

"We aim to continue working on our business goals and focus our trajectory in a positive direction," he added.-TradeArabia News Service