By Nikhil Pereira
Firm reports 21% increase in revenue to AED 2.01 billion in Q2 2020 driven by strong development business performance
Abu Dhabi’s Aldar Properties reported a 2% increase in net profit for Q2 2020, supported by revenue from its development business, which overcame Covid-19 lockdown challenges with "innovative financing packages" and digital solutions for customers.
Aldar reported a second quarter profit of AED 484 million ($132m), and revenues of AED 2.01 billion ($574m) - a 21% increase on the same period last year.
The property firm said revenue growth was driven by "robust demand for its prime developments and infrastructure-enabled land", with "steady fee income from its third-party development management business" also helping to boost its quarterly figures."The Abu Dhabi real estate market is being underpinned by government incentives for home buyers, fiscal stimulus measures and programmes to promote private sector growth," Aldar said in its earnings statement.
Talal Al Dhiyebi, CEO of Aldar said, “Aldar’s development business had a stand-out quarter, adapting quickly to arrange innovative financing packages and to roll out digital solutions, ensuring service excellence for our customers. This drove growth in revenue and profits, and strong cashflow generation.
"Our prime investment properties continue to perform solidly, and as the most efficient platform for real estate ownership in the region, we are looking at attractive opportunities to expand our diversified portfolio.”
Aldar’s development management business recorded AED 1.27 billion in development revenues in the second quarter, an 83% year-on-year increase.
The growth was driven by “strong progress” at projects under development, robust inventory sales and the company’s fee-based business, including the AED 5 billion of contracts with the Abu Dhabi Government announced in 2019.
Aldar said second quarter development sales stood at AED 505 million, for projects at Nareel Island and Yas Acres, along with land plot sales on Saadiyat Island.
Meanwhile, Aldar’s asset management business reported a 21% year-on-year decline in net operating income, with hospitality and retail properties temporarily closed for much of the period.
Occupancy rates across the investment properties portfolio, which includes residential, retail, and commercial assets, stood strong at 88%.