BEIRUT: Real estate development company Solidere’s net profit in 2013 surged by 148.1 percent to $39.7 million compared to $16 million in 2012 despite the economic slowdown and tense political situation in Lebanon and the region, the company said Monday.
The statement added that the consolidated profits of the company, which includes its investments abroad, has reached $42.6 million.
“This profit was more than double compared to the results in 2012 which was $16 million and this outcome was achieved despite the economic slowdown and the tense situation in Lebanon and the region,” the statement said.
Solidere added that the overall situation had an adverse impact on real estate rents.
“But the company, in an attempt to preserve the sustainability of investments and rents, offered moral and financial support to the investors and this has caused a slight drop [5 percent] in rents but in return the company was able to achieve substantial reduction (15 percent) in expenses, operation costs and real estate maintenance of rented properties.”
It added that the revenues generated from the sales of land soared by 48 percent to reach $95 million in 2013 and this indicates to the company’s efforts to achieve additional land sales.
But Solidere noticed that the sales of land designated for development improved slightly in 2013 compared to 2012.
Revenues from miscellaneous services improved in 2013.
Revenues from the fast Internet service for example jumped by 36 percent to reach $4 million.
Solidere also managed to slash administrative and general expenses by 17 percent to $28 million in 2013 compared to $34 million in 2012.
“The company intends to continue to reduce administrative and general expenses as well as operation costs and even withhold for five years the development projects as of 2014,” the statement said.
Solidere has also increased its provisions to reach $23 million which affected the revenues of the company as well.
It added that some investors who rented space and restaurants in BCD failed to pay their dues on time. The outstanding deeds on land sales which the company was not able to collect were estimated at $8 million.
However, Solidere stressed that the company still enjoyed high value property assets that are ready to be sold or for development.
The size of these properties is 1.8 million square meters with a value of $7.2 billion.
The rented built properties in BCD have a value of $1.5 billion and this includes the new movie theaters which were completed in 2013.
“The company still has cash liquidity valued at $165 million in addition to financial bonds from land sales operations and valued at $505 million,” Solidere said.
Solidere added that it hadassigned FFA Private Bank, which is specialized in properties, to conduct an independent assessment of the company’s assets and the results showed that the value of these assets reached $8.9 billion.
Sources said Solidere may not pay dividends to its shareholders this year.