By Andy Sambidge
Developer turns around fortunes after reporting AED1.5bn loss in year earlier period
Abu Dhabi-based Aldar Properties has announced that it made a nine-month net profit of AED460.4m ($125.3m) compared to a net loss of AED1.5bn in the same period last year.
Revenue for January to September rose to AED4.693.3bn, compared to AED932.4m for the same period in 2010, the developer said in a statement.
Abu Dhabi’s biggest property developer said on Monday it will slash its workforce by 24 percent as it seeks to cut costs.
The developer plans to shed 105 jobs to match its manpower needs to its scaled-back construction schedule, the company said.
The company said it had pocketed AED2.7bn from the sale of land during the period while residential property sales increased to AED913.6m following the completion and handover of Al Gurm, Al Bandar and Al Raha Gardens.
Aldar said rental income from investment properties, which include Aldar’s commercial office and retail portfolio, almost doubled to AED537.3m.
It said revenue for the third quarter rose to AED3.132.9bn compared to AED505.4m in Q3 2010, predominantly driven by a AED2.6bn land sale to the Abu Dhabi Government which was announced in January.
Net assets of the company grew 11.6 percent in the nine months ended September 30 and Aldar ended the nine-month period with AED2.277.8bn in cash and bank balances.
During the third quarter of 2011, Aldar said it completed the first phase of Motor World, a destination for new and used car showrooms and servicing facilities in Abu Dhabi.
All 100 units in this phase are leased and tenants will now begin the process of fitting out their showrooms, with rental income to begin in the fourth quarter of 2011.
Ali Eid AlMheiri, chairman of Aldar Properties, said: “This period has seen good progress in areas of strategic importance to the business.
"The development of our operational businesses such as Aldar Academies, with three new schools across Abu Dhabi, and our hotels division has been particularly encouraging and we fully expect this momentum to continue into the final quarter.”
Aldar Properties is building thousands of homes and offices across the UAE capital, but concerns have been raised about the company's ability to repay a massive debt pile and the government's growing stake in the company.
The developer was rescued by a $5.2bn bailout by the Abu Dhabi government this year, after it struggled to stay afloat in the wake of a recession that halved property prices across the UAE.
In January, the state-controlled firm sold assets including a Ferrari theme park and convertible bonds to the government for AED19.2bn to pay off its debt.