Union Properties Exceed Forecast With Dh317m Earnings

Union Properties reported second quarter earnings of Dh317 million, compared to consensus of Dh163 million and the company's estimate of Dh178 million. The net income was driven mainly by the recognition of Dh231 million for revaluation gains related to the company's investment portfolio. Al Mal Capital research had projected Dh56 million-revaluation gain.

Operationally, top line growth remains strong with revenues improving roughly 60 per cent over the same period last year. There was a seasonal decline of 2.5 per cent in revenues relative to 1Q 2008.Revenues for the quarter came in at Dh919 million relative to the company's expectations of Dh881 million.

Contracting revenues continue to be the main driver in the short term for the company's results accounting for roughly Dh300 million in revenue growth compared to the same period last year. There was a nearly 17 per cent increase in administration and general expenses relative to 1Q 2008. However, this was more than offset by the exceptional growth along all the business lines.