Full Year and Fourth-Quarter Results

Abu Dhabi, 31 January 2013: Sorouh Real Estate PJSC (“the Company” or “Sorouh”), the Abu Dhabi-based real estate developer (ADX: SOROUH), today announced its full year and fourth-quarter results for the period ended 31 December 2012.

Financial Highlights:

 Full Year Highlights

• Sorouh records another strong yearly performance with net profit of AED507.5m, 32 % up on full year 2011.

• 2012 revenue of AED3bn was mainly driven by National Housing projects, compared to the handover of Sun and Sky units in 2011. Leasing income increased by 25% year on year to AED217m reflecting successful lease-up of units in new developments such as Sun and Sky Towers, Al Murjan and the BOUTIK retail outlets, as well as continued high occupancy in established properties.

• Occupancy across leasable properties remains high and Sorouh continues to see good leasing interest from residential, corporate and retail clients.  The Company is confident of reaching its stated goal of AED600m of annualised recurring revenues by the end of 2015. The value of the investment properties portfolio increased by nearly AED800m to AED4.1bn, mainly as a result of the addition of Boutik Al Ain and leased units in Sun and Sky into the portfolio.

• 2012 continued to see strong investment in properties under development, which bodes well for delivery in 2013. These deliveries will drive cash flow and profit from handovers as well as continue to boost recurring revenues.

• Sorouh’s financial position remains robust and the balance sheet is strong. Cash collections in 2012 amounted to AED3.2bn and the company had AED1.3bn of cash on its balance sheet as of 31 December 2012. The company has started to amortise its club loan making repayments of almost AED400m to date. The loan will be fully repaid by June 2014.

• Gearing at year end was low, at 34%. Shareholder equity increased by AED297m to AED6.7bn. Net asset value per share is AED2.55, compared with AED2.43 as of the end of 2011.

Fourth Quarter Highlights

• Sorouh continued its strong performance in the fourth quarter of 2012, with net profit of AED118.9m, an increase of over 21% on the same period last year.

• Revenue from National Housing totalled AED443m in the fourth quarter, up 41% per cent from the same period in 2011.  

• The leasing portfolio generated AED67m of revenue in Q4, up 43% per cent compared to the same period in 2011.

Abubaker Seddiq Al Khouri, Managing Director, Sorouh, commented:

“It has been another year of strong profit growth and I am particularly pleased to see our recurring income grow. We have seen a great deal of operational progress across the development properties and National Housing projects, most of which are nearing completion. 

“Sorouh’s delivery pipeline for 2013 is very strong, with over 7,000 units coming to market. These deliveries will strengthen cash flow and improve profitability. Meanwhile, the proposed merger with Aldar will enhance shareholder value by bringing together two complementary businesses that will have a more diversified and balanced portfolio along with significant future growth opportunities.”

Q4 2012 Development Portfolio Update

Shams Abu Dhabi

• Sun & Sky Towers are now an established community with over 1,000 families living at the development along with key commercial tenants. The development won the best mixed-use award at Cityscape Abu Dhabi and Cityscape Global in 2012.

• BOUTIK Sun & Sky is generating solid footfall driven by Abu Dhabi’s first Waitrose supermarket, together with numerous other retail operators, including Italianissimo, La Brioche, Yogen Fruz and Café Macondo, among others.

• Commercial tenants at Sky Towers include the Austrian Embassy, Agthia Group, Al Ramz Financial Services, Advanced Integrated Systems and Arabian Construction Company.

• The Gate Towers are nearly 95% complete and advancing rapidly. At present, all sections of the penthouse bridge structure have been raised and locked in place. The development won Construction Week’s award for best tower project in 2012.

• During the quarter, Sorouh and Evolvence Knowledge Investments Limited (EKI) announced the launch of Repton School Abu Dhabi due to open in September 2013 on Shams Abu Dhabi.  The new school will be spread across two campuses, the first of which is a 7,000 square metre site for 520 children from nursery to year two.  Facilities including two multi-purpose halls and a swimming pool will see the delivery of British education synonymous with tradition, expertise and experience.  The second campus will open in 2014 for children in year three and over.

 alghadeer

• The development is 90% complete and progressing well, with infrastructure development and the construction of the residential buildings moving at a rapid pace. The development is on track for phased completion and delivery in the first quarter of 2013.   

 Saraya

• All infrastructure works at the Saraya master-planned development, near the Abu Dhabi Corniche, are complete and five plots are currently under construction by sub-developers. This is a positive development for the location and is a catalyst for other sub-developers. It has also created an interest in the secondary market for the sale of land plots.

National Housing:

• Construction at Phase One and Two of the Watani Development is substantially complete. Work continues on Sorouh’s two other National Housing projects, at Ghuraibah in Al Ain and Al Sila’a in the Western Region.  

Investment Properties – Residential:

al rayyana

• Remediation design is currently underway and tenants are expected to be able to move back into the development in the third quarter of 2013.

Al Murjan

• All retail space has now been leased with Spinneys, the high-end supermarket chain, as the anchor tenant. 90% of residential units have been leased as at end of Q4 2012.

Investment Properties – Hospitality and Retail:

BOUTIK Al Ain

• Carrefour, the anchor tenant for the property, commenced operations in December 2012. An aggressive leasing programme is currently being pursued with 65% of the property having lease agreements and MOUs.

 Tilal Liwa

• Tilal Liwa, the hotel located in the Western Region, remains profitable and cash-flow positive with occupancy of 73% for 2012.

Awards in 2012

Sorouh won several awards during the year, including;

• GCC Developer of the Year Award (Construction Week)
• Developer of the Year Award (Big Project)
• Gate Towers – Best Tower Project (Construction Week)
• Sun and Sky Towers – Best Mixed Use Development (Cityscape Abu Dhabi)
• Sun and Sky Towers  - Best Commercial-Mixed Use Development (Cityscape Global)

Potential Merger

On 21 January, the boards of Sorouh Real Estate and Aldar Properties recommended a merger between the two companies to their shareholders. Shareholders are scheduled to vote on the merger at their respective extraordinary general meetings (EGMs) on 21 February. For more details on the merger and the EGMs, please go to

www.aldar-sorouh.com.