Abu Dhabi property big gun Sorouh finishes on a Dh500m high

In its last ever full year results before a merger with Aldar, Sorouh said that consolidated net profits showed a 32 per cent hike on 2011 figures.

Abu Dhabi developer Sorouh has closed out 2012 with a profit, ahead of its merger this year with Aldar. Jaime Puebla / The National
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Abu Dhabi's second biggest listed property developer Sorouh announced a Dh507.5 million net profit for 2012 as it prepares to merge with rival Aldar.

In its last ever full year results posted on the Abu Dhabi Securities Exchange today, Sorouh said that consolidated net profits showed a 32 per cent hike on 2011 figures.

Profits for the three months to the end of December 2012 were 21 per cent higher than for the same period the previous year at Dh118.9 million.

The company whose flagship projects include Sun & Sky Towers on Reem Island which completed last year and the 3,500 apartment The Gate, also on Reem, which is set to be completed this year, said that 2012 revenue of Dh3 billion was mainly driven by its National Housing projects such as Al Watani, Al Ghuraibah in Al Ain and Al Silla in the Western Region.

Revenues from National Housing projects for the final three months of the year stood at Dh443m, a 41 per cent increase on the same period in 2011.

Sorouh, which agreed to sell around 700-800 flats in The Gate and infrastructure works at Shams Reem Island to the Abu Dhabi government for Dh3.2 billion as part of its merger agreement last month, said that the company had Dh1.3 billion on its balance sheet on 31 December 2012.

It added that leasing income increased by 25 per cent over the year to Dh217 million as more tenants signed up to its Boutik shopping mall on Reem Island, and its Sun & Sky and Al Murjan schemes.

In the final quarter alone the leasing portfolio generated revenues of Dh67 million - 43 per cent more than during the same period the previous year.

The company said the value of its investment properties portfolio increased by nearly Dh800m during the year to Dh4.1bn, mainly as a result of it completing work on its Boutik Al Ain shopping centre and Sun and Sky flats.

"Sorouh's delivery pipeline for 2013 is very strong, with over 7,000 units coming to market," said Sorouh managing director, Abubaker Seddiq Al Khouri.

"These deliveries will strengthen cash flow and improve profitability. Meanwhile, the proposed merger with Aldar will enhance shareholder value by bringing together two complementary businesses that will have a more diversified and balanced portfolio along with significant future growth opportunities."

Meanwhile it was good news for tenants at Sorouh's Al Rayyana scheme close to Abu Dhabi golf course. The development which was evacuated after a section of the car park collapsed in autumn 2012 has remained empty as the developer undertakes remediation design. Sorouh said it believed tenants would be able to move back to the scheme in the third quarter of 2013.

It said The Gate scheme was now 95 per cent complete while its Alghadeer scheme on the Dubai border was 90 per cent complete and on track to start delivery during the first three months of the year. It said it had completed infrastructure works at its Saraya development close to the Abu Dhabi Corniche and sub contractors were currently constructing five plots of land.