Aldar Properties half-year net soars to $86.1m
Developer sees reversal of fortunes after strong sales period
Aldar Properties, Abu Dhabi’s biggest developer, said net profits for the second quarter and first six months rebounded into the black a year after posting heavy losses, as residential sales boosted the bottom line.
Net profits for the second quarter reached AED 127.3m ($34.66m), strongly reversing the AED 475.3m ($129.41m) the previous year. In this time the company began its handover of the first phase of the Al Zeina residential development at Al Raha beach.
After-tax gains for the half-year totalled AED 316.4m ($86.14m), against a loss of AED 475.3m ($47.72m) last year, as revenue for the sales of completed units in projects such as Al Gurm, Al Bandar and Al Raha Gardens reached AED 1.56bn ($424.7m), more than ten times the AED 427m ($116.26m) posted for last year’s first six months. Of this total, AED 832.1m ($226.5m) derived from land and unit sales, AED 189.6m ($51.6m) from rent from investment properties, AED 177.1m ($48.21m) from project management and asset management services and AED 361.6m from the group’s operational businesses, which includes hotels and schools.
Total recurring revenue leapt to AED 728.3m ($198.3m), up from AED 354.6m ($96.54m)
“These figures reflect our efforts and we are encouraged by the continued increase in recurring revenue from our investment portfolio and operational businesses,” said Ali Eid AlMheiri, chairman of Aldar Properties who joined the company from Mubadala Infrastructure earlier this year. “The second half of the year will see continued delivery with the significant handover of residential units at Al Raha Beach and further progress across our development portfolio.”
The results represent a remarkable turnaround for the listed developer, which posted losses of AED 12.65bn ($3.44bn) for 2010 due to the continued slump in the property market that led to write-downs and weighty adjustments to its property portfolio in line with so-called fair-value accounting.
By the end of the year the company had announced the transfer of assets to the government, including the car-themed amusement park Ferrari World, and the issuance of a AED 2.8bn ($762m) convertible bond, bought by the Mubadala, the state-backed investment vehicle.
The first half of 2011 also saw the company finish and lease the largest IKEA store in the Middle East in the capital, the delivery of Al Raha Gardens Plaza, Sheikha Salama mosque in Al Ain and the completion of the first phase of Motor World, a showroom facilities for car firms. All 100 units are scheduled to open before the end of the year.
Aldar also saw one-off income from its transfer of assets to the government for the last half-year, an ongoing policy that last year saw Ferrari World, its car themed amusement park, transferred to state control along with the surrounding utilities in AED 5.5 bn ($1.5bn) deal.
The company expects to see further delivery of the Al Zeina units as well as proceeds from the completion of Al Muneera and an Aldar Academy, a project close to completion by a Wates-Al Fara’a joint venture, set in Al Bateen.
Aldar shares closed down 6.25% to AED 1.2 in afternoon trading in Abu Dhabi Sunday.