Abu Dhabi real estate firm starts 2009 on a positive note

The results reflect UAE real estate firm's strategy to develop its earnings profile by increasing recurring income for long term profitability

Abu Dhabi's leading real estate firm, Sorouh Real Estate PJSC announced its results for the first quarter of 2009. Net profit for the 1st quarter 2009 was Dh130.4m representing an increase on 4th quarter 2008 (Dh45.9m) but a decrease against 1st quarter 2008 (Dh361.5m). Earnings per share for the period were 5 fils per share (Q1 2008: 14 fils).

The results reflect the Company's strategy to develop its earnings profile by increasing recurring income for long term profitability. This will be achieved by retaining more property for development and subsequent sale and lease, despite the short term impact on the income statement. The results also reflect the decision to sell less land which is currently not reflective of its intrinsic value.

The Company maintains a strong balance sheet with net assets as at the end of the 1st quarter 2009 of Dh5.7bn (FY 2008: Dh5.9bn). Notably the business has seen strong growth of 63% in its investment properties to Dh1.4bn.The Company has low gearing and retains Dh5.9bn of cash on its balance sheet.