Dubai: Aldar Properties, Abu Dhabi's largest real estate developer, posted a third quarter net profit of Dh144 million yesterday after announcing earlier in the week it was to cut almost a quarter of its workforce as part of a major restructuring.
The company posted a nine-month profit of Dh460.4 million following a loss of Dh1.5 billion in the same period last year, according to an emailed statement.
The Abu Dhabi Government supported Aldar in January with a multi-billion dirham package that enabled it to continue with various projects. The company has sold numerous assets including Ferrari World, the world's largest indoor theme park, to ease its burden of debt amid tough operating conditions in the capital's real estate market.
Aldar, which posted a loss of Dh731.2 million in the third quarter of 2010, said revenues for the nine months to September stood at Dh4.6 billion, compared to Dh932.4 million in the year-before period. The net assets of the company grew 11.6 per cent in the nine-month period compared to December 31, 2010, and rose 1.9 per cent during the third quarter.
"These are really good results for Aldar and the market will react positively," said Mousa Haddad, head of the equity trading desk at National Bank of Abu Dhabi. "I was expecting Aldar's results to come in much lower," he added.
Difficult climate
Aldar's stock gained 0.98 per cent to Dh1.04 on Abu Dhabi's bourse before the results were announced. Last month it revealed its chief financial officer of five years would be replaced by Greg Fewer, an executive at Mubadala, in signs of growing influence of the government in the company.
Aldar is operating in a difficult climate with a report issued by Arqaam Capital recently claiming that Abu Dhabi's construction sector was fast becoming the worst in the GCC.
It said UAE developers were set to experience a difficult quarter as cut-throat price competition and a scale-down in government plans hit ongoing projects.
Last week the Tourism Development and Investment Company (TDIC) announced its three flagship museum projects on Saadiyat Island would be delayed, just weeks after the developer cancelled a major construction contract for the Frank Gehry-designed Guggenheim Abu Dhabi. "There has been continued delivery across our core developments with the hand-over of significant numbers of residential units at Al Zeina in Al Raha Beach and considerable progress on large-scale fee-based projects such as Al Falah, the Cleveland Clinic and Masdar," said Ali Eid Al Mheiri, Chairman of Aldar Properties.
"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," he added.
During the third quarter of 2011, Aldar delivered Al Zeina, one of the first new beachfront residential developments in Abu Dhabi. It also completed the first phase of Motor World, a development for new and used car showrooms.