ABU DHABI // Aldar Properties saw its second quarter profits more than double to Dh1.2 billion (US$326.7 million) compared to the same quarter last year, officials said yesterday. The largest developer in Abu Dhabi, with some 72,000 employees and Dh14.5bn worth of projects under development, is maturing as a company and starting to see a steady stream of income and business, analysts said.
"This quarter and indeed the first six months of the year reflect that its business is beginning to take shape, its income streams are beginning to contribute in a clearer fashion," said Sana Kapadia, an analyst at EFG-Hermes. She said that while revenues beat expectations, costs were higher than expected. Analysts' forecasts for Aldar's second quarter profit ranged from Dh801.83m to Dh1.5bn, according to Reuters, which conducted a survey last month.
Shafqat Malik, the chief financial officer of Aldar, said the company had benefited from land sales in particular. Of the Dh1.2bn of profit, Dh773m, or 64 per cent, came from the sale of plots of land. Aldar still has a land bank of 38 million square metres, a resource that is likely to fuel earnings for years to come. Mr Malik said the second quarter saw a continuation of a strategy the company started in the fourth quarter of last year, when it began selling apartments and land.
Aldar's profit for the first half of the year was Dh2.6bn, an increase of 168 per cent from Dh970m in the first half of last year. The amount of projects under development rose by 74 per cent to Dh14.5bn in the first half, compared to Dh8.3bn in the same half last year. One of the largest projects the company announced in the second quarter was Motor World - a Dh11bn, 3.5 million square metre development that will bring all the major car businesses of the capital under one roof. Aldar also announced Al Ruwais, a 30,000 square metre mall near the Saudi Arabian border.
Mr Malik said the company also had a successful period for raising financing, bringing in a total of Dh9.52bn in the first six months. In April, Aldar announced a Dh2.2bn ijara, or ≠sharia-≠compliant home financing concept, and last month it issued a Dh3.75bn sukuk, an Islamic bond, which was well subscribed. Since it was formed in 2004, Aldar has delivered several individual buildings, including Al Mamoura on Muroor Rd, but it is expected to begin finishing part of its major projects next year. These projects include components of Yas Island and Raha Beach. Aldar is also building two small island projects off the shore of Abu Dhabi Island - Coconut Island and Al Gurm - as well as a new Central Market and a major part of the Shahama-Saadiyat motorway that will connect Sheikh Zayed Rd directly with Abu Dhabi Island.
Aldar's share price lost Dh0.15 in trading yesterday, closing at Dh12.25. The price has gained about 21 per cent in the past six months. @Email:email@example.com