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Aldar reports 26% decline in Q1 profits to Dh493 million

Aldar reports 26% decline in Q1 profits to Dh493 million


Abu Dhabi, UAE


Aldar Properties, Abu Dhabi’s leading property development, management and investment company, has reported a 26 percent decline in net profits to Dh493 million, compared to the first quarter of 2018, ‘owing to legacy other income events’, the developer said in a statement.


“Adjusting for these legacy other income events and minorities, net profit attributable to shareholders up 4 percent to Dh553 million,” it said.


However, its gross profit of Dh723 million in the first quarter of 2019, was line with the first quarter of 2018. The net profit decline took place at the backdrop of a 20 percent year-on-year increase in revenue to Dh1.76 billion in the first quarter of 2019, compared to Dh1.47 billion in the first quarter of 2018.


The company’s asset management net operating income rose 9 percent to Dh431 million, driven by last year’s asset acquisitions. Its development sales totalled Dh1.0 billion in the first quarter of 2019, up 49 percent from the year earlier, driven by successful launch of Alreeman.


Talal Al Dhiyebi, Chief Executive Officer of Aldar Properties, “[The year] 2019 is off to a great start. Our strong sales reinforce Abu Dhabi’s favourable supply and demand dynamics as seen with Alreeman and Lea. 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.”


Recent government reforms, including the introduction of freehold title for foreign buyers within investment zones in Abu Dhabi, are enhancing the long-term attractiveness of real estate sector. In addition, the Abu Dhabi Government’s fiscal stimulus programme – Ghadan 21, and new measures to encourage business growth, are already starting to spur the economy and will increase the allure of the Emirate as a place in which to live, work and invest.


In line with Aldar’s strategy of growing its portfolio of high quality assets and optimising the value for shareholders, the Asset Management business continued to make strong progress in the first quarter of 2019, including a 94 percent growth in net operating income (NOI) versus Q1 2018 in the hospitality segment, supported by major events across Abu Dhabi including the Special Olympics and IDEX that led to higher occupancy.


In March, Aldar acquired full ownership of Etihad Plaza and Etihad Airways Centre in a Dh1.2 billion non-cash transaction that unwound three existing joint venture agreements with Etihad, a deal which is expected to add approximately Dh100 million in net operating income on an annualised basis.


In March, Aldar sold Al Murjan Tower for Dh289 million for an implied 6.6 percent yield, in line with Aldar Investments’ strategy to realise value and redeploy capital in new high-potential opportunities.


On the Development Management front, Aldar reported a strong quarter, delivering on its strategy of activating its land bank to deliver and sell projects on time quality and cost.