(Adds quotes, details from earnings call)
By Stanley Carvalho
ABU DHABI Feb 14 Aldar Properties
expects lower sales in 2017, its chief financial officer said on
Tuesday after the builder of Abu Dhabi’s Formula One circuit
reported flat fourth-quarter profit.
Net attributable profit fell to 727.9 million dirhams
($198.2 million) for the three months to Dec. 31 from 734.6
million a year earlier, Reuters calculated from Aldar's annual
That beat a forecast by analysts at SICO Bahrain of 496.0
million dirhams but fell short of a forecast of 849.0 million
dirhams from analysts at EFG Hermes.
The results come against a backdrop of a slowing economy and
property market in the oil-rich capital of the United Arab
While supply remains under control, consolidation in
government, oil and financial services sectors combined with
weaker sentiment continues to affect demand, consultants JLL
said in January.
Average rents in Abu Dhabi have fallen by about 5 percent
year on year, due to job losses and cuts in public expenditure.
Sales prices of apartments and villas have dropped by 11
percent year on year, JLL said.
Aldar's fourth-quarter revenue increased to 1.4 billion
dirhams from 1.1 billion dirhams a year earlier.
Aldar booked provisions of 100 million dirhams in the fourth
quarter of 2016.
For the full year, Aldar reported total sales of 3.5
That is likely to fall to 3.0 billion dirhams in 2017 as
Aldar focuses on affordable housing, Chief Financial Officer
Greg Fewer said on an earnings call.
“We are seeing some headwinds in the market right now,” he
In line with its guidance, Aldar plans to bring around 1500
new units into the Abu Dhabi market in 2017, the same as in
2016, Chief Development Officer Talal al Dhiyebi said on the
“We are looking at launching large-scale developments later
in the year but our focus in 2017 is tapping into affordable
segments where we are seeing strong demand,” he said.
The company may also refinance its $750 million sukuk
maturing in 2018, Fewer said, without elaborating. Aldar agreed
with banks to refinance loans worth 1.8 billion dirhams with
longer maturities, Fewer told Reuters in August.
Aldar's board proposed paying a dividend of 11 fils per
share for 2016, according to the statement, up from 10 fils per
share for the previous year.
($1 = 3.6720 UAE dirham)
(Additional Reporting by Tom Arnold, editing by Jasn Neely)