(Bloomberg) -- Aldar Properties PJSC plans to develop more mid-market residential homes in Abu Dhabi and focus on boosting recurring income, its chief financial officer said after second-quarter revenue tumbled.
The builder of the Ferrari theme park posted a 5.7 percent decline in second-quarter profit to 620 million dirhams ($169 million) as revenue declined 20 percent to 1.35 billion dirhams, according to a company statement. Still, net income beat the 582 million-dirham average estimate of two analysts on Bloomberg.
Projects like The Bridges, which caters to households with monthly income of 20,000 dirhams to 30,000 dirhams, represent a “rich vein of business delivering underserved, middle-income product in investment zones in Abu Dhabi,” CFO Greg Fewer said in an interview with Bloomberg TV. “There is more of that to come.”
Aldar, partly owned by an Abu Dhabi sovereign wealth fund, has been boosting its recurring income, with money generated from malls, hotels, leased homes and offices, to guard against volatility in residential sales. The company had an occupancy rate of about 90 percent across its residential and office portfolio as well as Yas Mall. Occupancy in hospitality was 78 percent.
Abu Dhabi's largest developer continues to assess opportunities for “high-quality assets to grow recurring revenues,” it said in the statement.
The shares of Aldar have declined 11 percent this year, compared with a gain of 1.4 percent for Abu Dhabi's benchmark index.
--With assistance from Hussein Slim
To contact the reporters on this story: Claudia Maedler in Dubai at cmaedler@bloomberg.net, Tracy Alloway in Abu Dhabi at talloway@bloomberg.net.
To contact the editor responsible for this story: Shaji Mathew at shajimathew@bloomberg.net.
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