The Dubai-based developer, Union Properties reports a huge loss of Dh966.75 million loss for the year 2021 as compared to the 2020’s profit of Dh200.98 million.
The company, which owns Motor City, also saw a sharp decline in its non-current asset base, being valued at Dh3.69 billion against Dh5.22 billion from 2020.
Accumulated losses now are approaching the Dh3 billion mark – at the end of 2021, this was at Dh2.92 billion. Its share capital is Dh4.28 billion.
Union Properties had a tough year, with changes at the Board of Directors and management levels. It came under federal investigation over a deal that was entered into by a former senior member of the board.
The UP stock came under pressure on the DFM, with heavy trades totaling 820,000 plus. The stock is trading at 24 fils. For some time now, the developer had been talking about a three-year turnaround strategy, which would have seen it shed some assets and also commit to launching new projects at Motor City. The management is yet to confirm whether the latest losses require more changes to that plan.
Union Properties had been through some tough times since 2017-18, with legacy issues acting as a millstone on its financials. At the end of 2020, when it reported a profit, it was felt some of these issues were now in the past.
However, the latest financial results reveal the developer’s ‘gain from the loss of control over a subsidiary’ as Dh352 million while revenue from customer contracts recorded as Dh398.69 million in comparison to 2020’s revenue of Dh375. 86 million.