UAE developer Aldar to return to profit in 2011
Abu Dhabi, April 17, 2011
Indebted developer Aldar Properties does not foresee any further impairments on its property portfolio in the near future, and will return to profit in 2011, the company's top official said on Sunday.
Sami Asad, Aldar's chief executive officer, also said the company, Abu Dhabi's largest property developer by market value, was not in need of any more immediate funding, after a government bailout earlier this year.
'We don't foresee any impairments in the near future. We are working to manage our finances,' Asad told Reuters in an interview. 'Managing cash flow remains a priority. We can't ignore it.
But we have enough finances to manage our present projects. Our focus is now on delivery of projects.'
Asad said Aldar would put over 2,000 residential units up for sale in 2011 and will be giving out construction contracts for the Yas mall next month.
Aldar was thrown a $5.2 billion lifeline by Abu Dhabi in January and announced plans to sell properties such as Ferrari theme park, the world's first park based on Italian sports car and racing teams. The Abu Dhabi government owns about 31 per cent of Aldar.
Asad said the firm may have to reach out to banks if project feasibility studies showed a need for additional financing, and said the company would look at issuing a $1.5 billion bond as the need arose. Shareholders recently approved the potential bond issue.
The builder of the Yas Marina Formula One circuit reported its largest-ever quarterly loss in the fourth quarter last year, taking writedowns of 11.3 billion dirhams in 2010, 10.8 billion dirhams of it booked in the final quarter.
But Asad said the company expects to return to profitability at some point in 2011. Aldar shares rose 2.5 per cent on the Abu Dhabi bourse at 0935 GMT.-Reuters