Damac Properties’ (Damac) management (Hussein Sajwani, Chairman; Adil Taqi, CFO) held a conference call to discuss the 3Q16 results. Below are the main highlights from the call:   Market has become more difficult. Management has mentioned that the market has become more difficult, given increased macroeconomic challenges, with profitability margins showing early signs of weakness. The compromise in margins came mostly from Akoya Oxygen, but not from the company’s project in the Business Bay area. Management’s focus will continue to be on deliveries and collection.   2016 contracted sales to exceed AED7bn, as guided. Management confirmed that the company is on track to meet its 2016 contracted sales target of at least AED7bn (EFGe: AED7.1bn). 4Q16 and 2017 launches will come with a focus on Aykon (with an aim to cash de-risk the project, being the company’s most recent addition) and in Akoya Oxygen (to bring-in relatively higher profitability margins). Guidance on 2017 was promised for 4Q16 call.   Guidance reiterated for 2016 deliveries of 2,700 to 3,000 units. 9M16 deliveries were 1,300 units, of which 800 units were in 3Q16. This leaves c1,400 to the target, of which c400 units were successfully delivered post the quarter’s close. Akoya will make up most of the remaining balance. The release of cash from the escrow account related to the to-be-delivered units may not take place fully in 4Q16, whereby a portion is expected in 1Q17.   No pressure to replenish land bank. Management indicated that there is no need to replenish land bank in the short-term, yet, it remains open for good opportunities, should those arise.    2016 dividend payment likely to be consolidated into one final payment, payable next year. While the board-guided dividend payment for 2015-16 will be met, management will recommend consolidating the payment into one, payable post the company’s AGM for 2016, which is planned to be held in April/May 2017. (Mai Attia, Sara Boutros, company)   DAMAC (DU): AED2.19 as of 6 Nov 2016, Rating: Neutral, FV: AED2.30 per share, MCap: USD3,610 mn, DAMAC UH / DAMAC.DU