Aldar earnings up 4% in fourth quarter

Abu Dhabi - The earnings rose to Dh750 million in the quarter. For the full year, the net profit rose 13 per cent year-on-year to Dh2.6 billion from Dh2.3 billion in 2014.

 Aldar Properties has earned four per cent year-on-year more net profit in the fourth quarter of 2015.
The earnings rose to Dh750 million in the quarter. For the full year, the net profit rose 13 per cent year-on-year to Dh2.6 billion from Dh2.3 billion in 2014.
Mohamed Al Mubarak, CEO of Aldar Properties, said: "2015 was another successful year for Aldar with development sales of Dh3 billion and gross profit from recurring revenue up by 49 per cent. Our focus on stabilising recurring revenue assets has significantly improved the quality of our earnings and provided clarity on long-term cash flow."
"Delivering shareholder value remains a priority for Aldar. Our continued success has created a more stable and mature company," the chief executive officer said.
"Our business remains underpinned by a healthy balance sheet, stable operating environment, and strong fundamentals. Consistency in delivering growth from a high quality portfolio of assets and a strong pipeline of developments gives me great confidence in Aldar's future."
The Board of Directors recommended a cash dividend of 10 fils per share for 2015, up 11 per cent from 9 fils in 2014.
With a stabilised asset base and higher quality of earnings, the Board has concluded that now is the right time to formalise a progressive policy for dividend recommendations, linked to the underlying cash flow performance of the business.
With effect from financial year 2016, the Company's dividend policy will be to recommend returns to shareholders, in the form of annual dividends, of between 65 per cent to 80 per cent of distributable free cash flow from the investment properties and 100 per cent owned operating companies. This will be supplemented by a discretionary percentage of the total realised cash profits on the completion of development projects.
In the fourth quarter, gross profit from recurring revenues increased by 35 per cent to Dh447 million versus Dh332 million in the same period of 2014.
Full-year gross profit from recurring revenues rose 49 per cent to Dh1.5 billion in 2015, underpinned by the stabilisation of key assets including Yas Mall, as well as an overall improvement in the operational performance across all asset classes. In addition to underpinning a progressive dividend policy, Aldar's stabilised asset base gives the Company confidence in targeting net operating income from recurring revenue assets of Dh2.2 billion by 2020, representing growth of 40 per cent. As previously announced, this will be supported by an investment programme of Dh3 billion, of which 30 per cent has already been committed to date. In 2015, a greater proportion of revenue was derived from recurring revenue assets, whereas in 2014 the primary driver of revenues was development handovers. This change in revenue mix explains the reduction of 30 per cent in overall revenues in 2015.
During 2015, Aldar continued to strengthen its balance sheet through the collection of receivables and further deleveraging, providing a solid platform for future growth.
Yas Mall has reached a stabilised trading occupancy, delivering a high quality shopping experience through a wide variety of household brands such as Apple, Nike, Zara, Debenhams and Adventure HQ.
Since opening, Yas Mall has attracted over 20 million visitors.
The residential portfolio is fully leased with continued demand for Aldar products.
Hotel portfolio occupancy was in line with 2014 and continues to outperform the wider Abu Dhabi market.
During the year, the property developer launched four residential projects; three sold out, one ongoing. Dh3 billion development sales in 2015 across over 900 units.
- haseeb@khaleejtimes.com