Sorouh Real Estate
Q1 Profit Up 16pc

ABU DHABI - Sorouh Real Estate, the second largest property developer in Abu Dhabi showed rise in net profit by 16 per cent as revenues grew significantly to Dh978 million in the second quarter against the first three months of the year.

By Haseeb Haider

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Published: Fri 24 Jul 2009, 1:25 AM

Last updated: Sun 5 Apr 2015, 10:30 PM

However, net profit fell 71 per cent in the first half of the year to Dh281 million from Dh977 million in 2008. Improvement in revenues, which reached Dh978 million against Dh335.6 million in the first quarter led to substantial growth in net profit to Dh151 million in the second quarter up against Dh130 million in comparable period.

Revenues for the first half year 2009 were Dh1.314 billion against Dh1.693 billion in the same period a year earlier. “These results are in line with the previous guidance given at the Q1 2009 results and reflect the company’s strategy to focus on cash conservation along with prudent management of operating costs,” the real estate company said in a statement.

The company maintains a strong balance sheet with net assets of Dh5.9 billion, as at the end of the second quarter 2009 slightly higher than Dh5.7 billion in first three months of the year. The business has seen strong growth of 63 per cent in its investment properties to Dh1.4 billion.

The property firm has Dh4.9 billion of cash on its balance sheet. Total bank borrowings are Dh 150 million, representing a debt to equity ratio of 2.53 per cent, this excludes the outstanding amounts of the asset-backed Sukuk Certificates issued in the third quarter of 2008, a non-recourse facility.

During the period, Sorouh launched new customer initiative for The Gate Towers offering a price reduction and assisting customers to find suitable financing for their property purchases.

Despite the tough economic environment, long term demand remains promising in the emirate and the company is actively managing its cash position, Mounir D. Haidar, Chief Executive Officer of Sorouh said.

“This makes us well-placed to capitalise on our strong position when the markets recover,” he added.

All of Sorouh’s Abu Dhabi projects remain on track with the core focus being on maintaining delivery schedules. Golf Gardens 1 is largely complete with villas starting to be handed over from 1 July 2009; Sun Tower and Sky Tower, at the entrance to SHAMS Abu Dhabi on Al Reem Island have both topped out 100 days ahead of schedule and are scheduled to be handed over during the first half of 2010.

The Gate Towers enabling work has been completed and construction has started for the foundations; Alghadeer project near Dubai is progressing to the construction phase. Work on Golf Gardens II, a residential rental community district adjacent to Golf Gardens I has started.

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