A research by Global Investment House has forwarded that the year 2009 experienced a decline by 25% in corporate profits of listed companies in the UAE, with four main sectors witnessing sharp drops.

The real estate and financial sector woes pulled down the overall corporate profits, which plunged to Dh31.38 billion from Dh41.96 billion recorded in the previous year, since a series of external and domestic shocks including global economic slowdown, plummeting oil receipts, and tightening of global trade hit the UAE economy adversely.

The property firms were the ones which were hit the hardest since their profits fell 74.4 per cent to Dh2.2 billion from Dh8.7 billion in 2008, amidst an enormous decline in rental and sale prices.

Furthermore, the banking sector recorded a drop by 21.67 pct in profits from Dh17.64 billion in 2008 to Dh13.82 billion in 2009. The hiking bad debts amidst the global financial crisis and regional problems that resulted in heavy provisions were the reason for the dismal performance of the banking sector.

But the economic plunge did not affect 10 banks from posting an increase in profit in 2009. It should be noted that 9 of these 10 banks are listed on the Abu Dhabi Securities Exchange. In Dubai, profit was posted by only Commercial Bank of Dubai, listed on the Dubai Financial Market (DFM).

The largest profit surge was seen by Invest Bank, which was among the gainers in banking sectors, as it hiked notable 6033.44 per cent with total profits reaching Dh288.52 million, and earnings per share for the period under review rising to Dh0.25 in 2009, compared to Dh0.004 a year earlier.

Insurance companies also posted a combined profit decline of 6.63 per cent to Dh1 billion in 2009.

Annual profits declined for all but two property firms, with some blue chip companies posting the biggest decline in profits.