The Abu Dhabi developer Aldar Properties compensated for a drop in government income in the first quarter of this year by boosting property and land sales.
In a statement to the Abu Dhabi bourse on Tuesday, Aldar said that profit attributable to shareholders stood at Dh636 million in the first three months of this year, 2 per cent lower than the year-earlier profit of Dh649m.
The result beat analysts’ expectations and lifted Aldar’s shares.
The shares closed up by 1.8 per cent on Tuesday after rising as much as 2.3 per cent in intraday trade.
For the quarter, Sico Bahrain had forecast that Aldar would make a net profit of Dh509.07m, EFG Hermes forecast Dh600m and NBAD Securities, Dh561 million.
Aldar said the reason net profit fell in the latest quarter was that in last year’s first quarter it had received a profit boost from Dh219 million in government grants for building infrastructure assets, which were not repeated this year.
Aldar’s gross profit – which does not include government contributions – was Dh753m, an increase of 39 per cent compared with the Dh542m it made in Q1 2016.
Revenue grew by 28 per cent to Dh1.58 billion, driven by revenue booked on developments under construction and land plot sales.
Aldar said that it had sold more than Dh100m of land plots to investors and developers in various locations across Abu Dhabi. The developer declined to say exactly how much land it had sold during the quarter.
Aldar also said that it had agreed off-plan sales with customers that would eventually be worth Dh1bn during the quarter, mostly at its West Yas and Yas Acres projects on Yas Island.
“We have a tremendously active portfolio of off plan development,” said Greg Fewer, chief financial officer at Aldar.
“When we grow our gross profits in the way that we have, it’s a reflection of our strong sales and it’s a reflection of the construction activity we are seeing across our portfolio on site. In addition it’s a reflection that we have a very large and very valuable land bank in Abu Dhabi, which investors are showing increasing interest in,” he said.
Sanyalak Manibhandu, the head of research at NBAD Securities, said it was maintaining its buy rating on the stock and might raise its forecast for the stock price.
“Aldar’s revenues include Dh534m in property development and sales,” Mr Manibhandu noted. “Included in this is Dh120m in land plot sales which account for half of the favourable variance in the top line.”
Aldar’s jump in revenue comes despite a series of dismal market reports by property brokers reporting that house prices and rents in Abu Dhabi are falling as the city is hit by large-scale company lay offs and government cut backs following falls in the global oil price.
Last week, CBRE reported that residential rents fell 8 per cent in the first three months of the year compared with the same period a year earlier while office rents are 5 per cent lower.
But Aldar said that by tapping into demand for smaller, cheaper off-plan apartments in Abu Dhabi, it had been able to find buyers for the first three towers it plans to develop at its The Bridges project on Reem Island.
“From Aldar’s point of view we consider it exceptional demand [at The Bridges],” said Talal Al Dhiyebi, the chief development officer at Aldar. “For the first time in many years we are reaching out to that affordability level. There are still lots of people in Abu Dhabi who are employed in various sectors who are within that price point. So we’re tapping into that segment which exists in the market.”
In February, Aldar said that it expects property sales to fall this year to about Dh3bn, from Dh3.5bn in 2016, as the company focuses on building mid-market homes.
Aldar received the promise of billions of dirhams from the Abu Dhabi government after the global financial crisis. The company said that payments are still being made by the government in return for the company building infrastructure at government developments.
lbarnard@thenational.ae
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THE SPECS
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Formula Middle East Calendar (Formula Regional and Formula 4)
Round 1: January 17-19, Yas Marina Circuit – Abu Dhabi
Round 2: January 22-23, Yas Marina Circuit – Abu Dhabi
Round 3: February 7-9, Dubai Autodrome – Dubai
Round 4: February 14-16, Yas Marina Circuit – Abu Dhabi
Round 5: February 25-27, Jeddah Corniche Circuit – Saudi Arabia
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Name: Abeer Al Shahi
Emirate: Sharjah – Khor Fakkan
Education: Master’s degree in special education, preparing for a PhD in philosophy.
Favourite activities: Bungee jumping
Favourite quote: “My people and I will not settle for anything less than first place” – Sheikh Mohammed bin Rashid.
Milestones on the road to union
1970
October 26: Bahrain withdraws from a proposal to create a federation of nine with the seven Trucial States and Qatar.
December: Ahmed Al Suwaidi visits New York to discuss potential UN membership.
1971
March 1: Alex Douglas Hume, Conservative foreign secretary confirms that Britain will leave the Gulf and “strongly supports” the creation of a Union of Arab Emirates.
July 12: Historic meeting at which Sheikh Zayed and Sheikh Rashid make a binding agreement to create what will become the UAE.
July 18: It is announced that the UAE will be formed from six emirates, with a proposed constitution signed. RAK is not yet part of the agreement.
August 6: The fifth anniversary of Sheikh Zayed becoming Ruler of Abu Dhabi, with official celebrations deferred until later in the year.
August 15: Bahrain becomes independent.
September 3: Qatar becomes independent.
November 23-25: Meeting with Sheikh Zayed and Sheikh Rashid and senior British officials to fix December 2 as date of creation of the UAE.
November 29: At 5.30pm Iranian forces seize the Greater and Lesser Tunbs by force.
November 30: Despite a power sharing agreement, Tehran takes full control of Abu Musa.
November 31: UK officials visit all six participating Emirates to formally end the Trucial States treaties
December 2: 11am, Dubai. New Supreme Council formally elects Sheikh Zayed as President. Treaty of Friendship signed with the UK. 11.30am. Flag raising ceremony at Union House and Al Manhal Palace in Abu Dhabi witnessed by Sheikh Khalifa, then Crown Prince of Abu Dhabi.
December 6: Arab League formally admits the UAE. The first British Ambassador presents his credentials to Sheikh Zayed.
December 9: UAE joins the United Nations.
The past Palme d'Or winners
2018 Shoplifters, Hirokazu Kore-eda
2017 The Square, Ruben Ostlund
2016 I, Daniel Blake, Ken Loach
2015 Dheepan, Jacques Audiard
2014 Winter Sleep (Kış Uykusu), Nuri Bilge Ceylan
2013 Blue is the Warmest Colour (La Vie d'Adèle: Chapitres 1 et 2), Abdellatif Kechiche, Adele Exarchopoulos and Lea Seydoux
2012 Amour, Michael Haneke
2011 The Tree of Life, Terrence Malick
2010 Uncle Boonmee Who Can Recall His Past Lives (Lung Bunmi Raluek Chat), Apichatpong Weerasethakul
2009 The White Ribbon (Eine deutsche Kindergeschichte), Michael Haneke
2008 The Class (Entre les murs), Laurent Cantet
Profile of Bitex UAE
Date of launch: November 2018
Founder: Monark Modi
Based: Business Bay, Dubai
Sector: Financial services
Size: Eight employees
Investors: Self-funded to date with $1m of personal savings
Crops that could be introduced to the UAE
1: Quinoa
2. Bathua
3. Amaranth
4. Pearl and finger millet
5. Sorghum
The Library: A Catalogue of Wonders
Stuart Kells, Counterpoint Press
COMPANY PROFILE
Name: Almnssa
Started: August 2020
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Based: Gaza
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RESULTS
Main card
Bantamweight 56.4kg: Mehdi Eljamari (MAR) beat Abrorbek Madiminbekov (UZB), Split points decision
Super heavyweight 94 kg: Adnan Mohammad (IRN) beat Mohammed Ajaraam (MAR), Split points decision
Lightweight 60kg: Zakaria Eljamari (UAE) beat Faridoon Alik Zai (AFG), RSC round 3
Light heavyweight 81.4kg: Taha Marrouni (MAR) beat Mahmood Amin (EGY), Unanimous points decision
Light welterweight 64.5kg: Siyovush Gulmamadov (TJK) beat Nouredine Samir (UAE), Unanimous points decision
Light heavyweight 81.4kg: Ilyass Habibali (UAE) beat Haroun Baka (ALG), KO second round
COMPANY%20PROFILE
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Five expert hiking tips
- Always check the weather forecast before setting off
- Make sure you have plenty of water
- Set off early to avoid sudden weather changes in the afternoon
- Wear appropriate clothing and footwear
- Take your litter home with you