Shares in Dubai’s Union Properties (UPP) dropped on Tuesday, after the company reported a wider year-on-year third quarter (Q3) earnings loss for 2018.

Q3 2018 loss attributable to shareholders amounted to 61.8 million UAE dirhams ($16.8 million) compared to a loss of 45 million UAE dirhams for the same period last year.

Revenue for the period amounted to 145.7 million dirhams, versus 116.3 million dirhams a year ago.

Shares in UPP dropped 0.95 percent on Tuesday, and the stock was the fourth-most active stock in terms of volumes, dragging Dubai’s index to close 0.98 percent lower for the day.

“Union Properties is still facing persistent operating challenges,” Selima Mrabet, an analyst at Tunisia-based equities research firm AlphaMena told Zawya by email.

The company reported a yearly net loss for 2017 of 2.38 billion UAE dirhams, compared to a net profit of 211.4 million UAE dirhams for 2016, which was due to a large, one-off loss declared in the second quarter of last year relating to a write-off in the value of some of the land held in its Dubai Motor City district. (Read more)

UPP’s stock price has dropped 36 percent so far this year. A Thomson Reuters index of UAE real estate shares has declined in value by 26.4 percent since the start of the year as the market has continued to soften as prices decline. (Read more)

“The stock has displayed a negative share price momentum since the release of disastrous FY 2017 figures.” Mrabet said.

“Clearly, investors lost appeal because of a huge lack of visibility boosted by the demand drop and the price softening.”

Mrabet added that AlphaMena maintains a sell recommendation on the stock.

The company announced to the Dubai Financial Market in September that it was “not considering any merger” after rumours had emerged about a potential tie-up with another Dubai-based developer. (Read more)

Elsewhere in the region, Abu Dhabi’s index gained 0.25 percent on Tuesday, while Qatar’s index dropped 0.96 percent, Oman’s index edged 0.28 percent lower, Bahrain’s index dropped 0.26 percent and Kuwait’s index edged 0.13 percent higher.

By 14:43 GST, Saudi Arabia’s index was trading 0.16 percent lower on Tuesday and Egypt’s blue chip index EGX30 was trading 0.6 percent lower.

(Reporting by Gerard Aoun; Editing by Michael Fahy)

(Gerard.aoun@refinitiv.com)

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