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Q1 net profit down by 26% despite revenue hike at Aldar in Abu Dhabi

Developer says launch of Alreeman drove a 49% year-on-year increase in development sales, worth $272.3m, during Q1 2019

Aldar's revenues grew in Q1 2019.
Aldar
Aldar's revenues grew in Q1 2019.

Net profits declined by 26% at UAE real estate developer Aldar Properties in Q1 2019, despite a 20% revenue spike at the Abu Dhabi Securities Exchange-listed development giant during the period.

For the three months ending 31 March, 2019, Aldar's net profit was valued at $134m (AED492.5m), a 26% decline compared to 2018’s corresponding figure of $182m (AED668.5m) owing to “legacy [and] other income events”.

Aldar – the developer behind beachfront homes Mamsha Al Saadiyat and the $544.5m (AED2bn) Alreeman, among others – said revenues grew by 20% on Q1 2018 to hit $479.2m (AED1.76bn) during Q1 2019.

The group said its January 2019 launch of Alreeman, located close to the Abu Dhabi International Airport, drove a whopping 49% increase in development sales, which hit $272.3m (AED1bn) in Q1 2019.

April 2019 saw Aldar launch its Lea waterfront residential project on Yas Island – the home of Yas Mall, Ferrari World, and Warner Bros World – in response to what chief executive officer, Talal Al Dhiyebi, described as “pent-up demand” for such properties in the UAE capital.

Speaking on the group’s Q1 2019 results, Al Dhiyebi said the developer’s “strong sales reinforce Abu Dhabi’s favourable supply and demand dynamics as seen with Alreeman and Lea”.

He continued: “Our high-quality asset management portfolio is well balanced and showing the benefits of its strategic diversification. Our strategy is optimised to take advantage of the opportunities stemming from pro-growth government initiatives.”

Aldar announced the creation of Aldar Investments, the region’s largest diversified real estate investment company, in September 2018.

The launch followed an Abu Dhabi Executive Council Decree that extended full onshore real estate ownership rights to Aldar Properties and its subsidiaries in Abu Dhabi.

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Construction Week - Issue 741
May 11, 2019