Sorouh profits surge on real estate handovers

Drop in bad debt provisions pushes Abu Dhabi developer to AED125m net profit
Sorouh profits surge on real estate handovers
Sorouh said in June it will continue to focus on the delivery of existing projects in its home market in 2011
By Reuters
Thu 28 Jul 2011 10:23 AM

Sorouh Real Estate reported a four-fold surge in
second-quarter net profit as Abu Dhabi's second largest property developer handed
over more units and saw a sharp drop in bad debt provisions.

Sorouh made a net profit of AED125m ($34m) compared with AED31m
in the same period last year, it said in a statement on Thursday.

Profits for the first half were AED202m, up 33 percent from
the prior year period.

Revenues for the quarter was AED1.22bn, most of which was
derived from ongoing handover of units in Sun and Sky Towers, revenues from
housing projects awarded by the government and income from rental portfolio.

Sorouh's year-ago revenue stood at AED189.8m.

Provisions for doubtful debt dropped to AED6.2m for the
quarter, down from AED41m during the same period last year.

The developer said in June it will continue to focus on the
delivery of existing projects in its home market in 2011 and has no plans to
expand abroad just yet.

Most Abu Dhabi developers have been focusing on completion
and delivery of existing projects after suffering big losses during the global
financial crisis, which put an end to a six-year construction boom.

Sorouh reported a 42 percent drop in first-quarter profit, after the firm saw no land sales in the first quarter and made less money on property handovers.

It won AED.89bn worth of contracts awarded by Abu Dhabi's Urban Planning Council (UPC) in April.

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