Sorouh profit up 34pc
Abu Dhabi, July 31, 2012
Abu Dhabi's Sorouh Real Estate , which is in merger talks with larger rival Aldar Properties, reported a 34 percent rise in second-quarter net profit on Tuesday, beating analyst estimates.
The second largest developer by market value in Abu Dhabi made a net profit of 148.2 million UAE dirhams ($40.35 million), compared to 110.4 million dirhams in the prior-year period, the company said in a statement on the Dubai bourse.
The estimates beat two analysts' forecasts which had estimated net profit between 57.5 million dirhams and 132 million dirhams.
Revenues for the quarter reduced to 681.3 million dirhams from 1.2 billion dirhams in the prior-year period. The company said earnings were helped by revenue from government housing projects.
'We are continuing to invest across our development portfolio to ensure that we meet the demand for high quality product with a pipeline of some 7,000 units,' said Abubaker Seddiq Al Khouri, managing director of Sorouh.
The developer announced earlier this year that it may merge with Aldar in a state-backed tie-up that could create a company worth about $15 billion in assets.
Sorouh said the due diligence process for the merger is 'well underway'.
Abu Dhabi's property market is facing challenges as a huge supply of high-end homes are expected to enter the market this year. Property prices in the emirate are expected to fall another 5 percent in 2012, a Reuters poll showed. - Reuters