Project Gazelle – PMO Committee Uploads/IR_Analyst_PPT_Q2-2015.pdf · 2016-02-02 · Net profit...

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00 Disclaimer

■ Net profit up 18% to AED 601 million

■ Investment properties gross profit up 92% to AED 299 million in Q2 2015 due to contribution of fully leased residential portfolio and Yas Mall

■ Property development gross profit up 27% to AED 135 million despite lower revenues as margins improve

■ Lower finance costs – down 46% in quarter

■ Strong cash flow generation following collection of AED 1.2 billion Government of Abu Dhabi receivable

■ Further AED 1.1 billion reduction in debt to AED 7.1 billion during the quarter

■ Earnings per share of 8 fils in Q2 2015 (Q2 2014: 6 fils)

01 Q2 2015 Results Q2 Net Profit AED 601 million, up 18% versus Q2 2014

Retail

■ 340 units now trading at Yas Mall. Yas Mall is fully leased and expected to be fully occupied by year end

Residential

■ 4,800 unit strong residential portfolio achieved occupancy of 98% as at 30 June 2015

Office

■ Office portfolio achieved 91% leasing as at 30 June 2015, following further leasing agreements signed (30 Jun 2014: 86%)

Hotels

■ H1 2015 occupancy across the hotel portfolio at 81%, in line with H1 2014

02 Q2 Operational Highlights Continued recurring revenue asset stabilisation

Development launches

■ 2,000 units across three residential developments announced at CityScape: Mayan, Meera and West Yas

Q2 Development sales

■ Nareel Phase II land plots sold out

■ Meera Phase I apartments sold out

Development announcements

■ Main construction contracts awarded at Ansam and Al Hadeel and both making good progress

■ H1 development sales of AED1.9bn

Development management projects

■ Abu Dhabi Plaza project in Kazakhstan progressing well

03 Q2 Operational Highlights (cont’d) Development

04 Business overview

Property development management Asset management Adjacent Businesses

Property Development • Current projects – Ansam, Hadeel, Nareel,

Merief, Meera and Al Raha Beach • Upcoming projects – Mayan Development Management • Development management projects

including Abu Dhabi Plaza Kazakhstan • National Housing Initiative – no active

projects

Retail • 470,000 sqm GLA across 27 assets • Yas Mall: 100% leased Residential • 4,800 units across 10 developments • 98% leased as at 30 Jun 15 Office • 184,000 sqm GLA across 6 assets • 91% leased as at 30 Jun 15 Hotels • 2,536 keys across 9 hotels • 81% occupancy in H1 2015

Schools • Aldar Academies – 100% owned • 5,500 student seats across 6 schools Property & Facilities Management • Khidmah - 60% owned Construction • Pivot – 60% owned

Property

Development

Development

Management

Investment

Properties

Hospitality &

Leisure

Operative

VillagesLand sales National Housing Residential Hotels Yas Island OVs Aldar Academies

Unit sales Commercial Yas Links Al Ain OV Khidmah

Other (transfer

fees etc)

Retail Pivot

Property

management fees

Property

DevelopmentConstruction

Investment

PropertiesHotels

Operative

VillagesLeisure Schools

Land sales National Housing Residential Hotels Yas Island OVs Yas Links Aldar Academies

Unit sales Pivot Commercial Al Ain OV

Development

management fees

Property

management fees

Retail

Khidmah

Adjacent

Businesses

Development

management fees

Other (transfer

fees etc)

Property & Development Mngt Asset Management

Ne

w s

egm

en

talr

ep

ort

ing

Pri

or

segm

enta

lre

po

rtin

gUpdates to segmental reporting

05

Reasons for segmental changes

■ Realign segments with management’s view and strategic guidelines

■ Better align communication of business strategy to market

No change to reported recurring revenues – same asset classes included

Recurring revenue assets

Shift into Property & Development management segment

Shift to Asset Management segment

Shift to Adjacent Businesses segment

Red

Green

Blue

Legend

Why now

■ Mandatory from 1 January 2018, with option to early adopt

■ Ready to adopt today

Impact on Aldar financials

■ Subject to contract terms agreed – revenue recognition will be over-time or point-in-time

■ Major impact on off-plan development sales as will predominantly recognise revenue over-time under IFRS 15 versus old IAS 18 revenue recognition based on Aldar contracts

■ Adoption effective from 1 January 2015

■ Therefore AED 54 million adjustment to 1 January 2015 opening balance retained earnings (H1 2015 Financial Statements Note 2)

06 IFRS 15 early adoption and impact

AED millions Q2 2015 Q2 2014 Remarks H1 2015 H1 2014

Revenues 1,106 2,194 2,285 3,913

Direct costs (612) (1,869) (1,193) (3,241)

Gross profit 494 325 1,092 673

Gross profit Margin 45% 15% 48% 17%

SG&A expenses (94) (106) (182) (199)

Depreciation and Amortization (51) (58) (102) (113)

Gain on disposals 6 58 14 58

Share of profit from associates/ JVs 21 17 40 11

Other Income 330 272 478 697

Finance expense (62) (113) (124) (263)

Finance income 21 30 39 69

Fair value losses, provision/ reversal for

impairments(64) 83 (82) 32

Net Profit for the period 601 509 1,172 965

Attributable to:

Owners of the Company 599 506 1,168 959

Non-controlling interests 2 3 4 6

Profit for the period 601 509 1,172 965

Basic and diluted earnings per share (fils) 0.08 0.06 0.15 0.12

Profit and Loss Improved gross profit margins and quality of earnings

07

Lower development revenue given 2014 Gate handovers, partly offset by growth in recurring revenues

Improved margins supported by growth in recurring revenues and higher margins on new development revenues

Q2 2015 includes infrastructure provision reversal and infrastructure recoveries

Significant reduction in interest expense following refinancing efforts over the past 24 months

Net fair value losses taken on short leases in Investment Property portfolio asset and provisions taken

592

75 9 28 36

313

67 25 27 27

353

214

0

200

400

600

800

0

100

200

300

400

500

600

700

Investment Properties Hospitality & Leisure Operative Villages Adjacent Businesses DevelopmentManagement

Property Development

Segmental Gross Profit Performance

AE

D M

illio

ns

AE

D M

illio

ns

795

302

58

438

44

470

289

72

232 122

649

0

200

400

600

800

1,000

1,200

1,400



Segmental Revenue Performance

AE

D M

illio

ns

AE

D M

illio

ns

Half year 2015 segmentation performance analysis

08

¹ Recurring revenues assets include Investment Properties, Hospitality & Leisure, Operative Villages, Schools (Aldar Academies) and Property & Facilities Management (PFM) (Khidmah) H1 2015 recurring revenues excludes Pivot revenue of AED205m (H1 2014 revenue: AED39m) H1 2015 recurring revenue gross profit excludes Pivot gross loss of AED5m (H1 2014 gross loss: AED9m)

H1 2015 recurring revenues of AED1,388 million (H1 2014: AED 1,024 million) ¹

H1 2015 recurring revenue gross profit of AED707 million (H1 2014: AED 440 million) ¹

2,728

09 Balance Sheet Continued strengthening of balance sheet as collect receivables and pay down debt

AED millions As at 30 Jun

2015

As at 31 Dec

2014Remarks

Property, plant and equipment 3,125 3,200 Decrease due to net depreciation charge partially offset by additions during period

Investment properties 14,679 14,401 Increase principally due to transfer of leased Gate units

Development work in progress 2,965 2,871 Increase due to capex incurred on projects

Inventory 2,081 2,758 Reflects the recognition of cost of sales for units handed over during the quarter and

transfer of leased Gate units to IP

Receivables 6,756 9,619 Mainly reflects the collection of Government of Abu Dhabi receivables

Cash 5,250 4,664 Net increase principally due to collection of Government of Abu Dhabi, partly offset by

debt repayments during the first half

Other Assets 1,047 1,036

Total Assets 35,903 38,549

Equity 18,897 18,373 Net increase due to H1 2015 net profit of AED 1.2 bn, partly offset by payment of

2014 final dividend

Debt 7,098 9,170 Decrease due AED2.1bn repayment of debt during the first six months

Payables, Advances and Other Liabilities 9,908 11,006 Movement principally due to the settlement of contractor payables

Total Liabilities and Equity 35,903 38,549

Net Debt to Equity(excluding restricted cash) 14% 30%

Net Debt to Equity(including restricted cash) 10% 25%

Government transaction cash flows Clear outlook on remaining government receivables

10

¹ Cash collected in H1 2015 ² Cash flow timing depends on handover of related assets ³ Excludes AED0.8bn of on-balance sheet infrastructure recoverables outstanding as at 30 June 2015 (31 March 2015: AED2.0bn). During Q2, payments of 574m and 592m were received in April and June respectively.

ALDAR Government Deals AED millions

Transaction (AED in millions) H1 2015¹ H2 2015 2016 2017 Total H2 2015 – 2017

Sale of F1 Race Track - 348 348 348 1,044

Sale of Al Raha Beach Land and Yas Island Assets ² - - 908 - 908

Sale of Central Market and Units & Infrastructure in Al Raha Beach 1,318 - - - -

Shams Infrastructure Reimbursement & Sale of Gate units ² - - 300 - 300

1,318 348 1,556 348 2,252

■ Total of AED 2.5 billion in total Government receivables collected in first half of 2015:

■ AED 1.3 billion received in relation to Central Market transaction during Q1

■ AED 1.2 billion received in relation to infrastructure recoverables during Q2

Q2 2015 Summary 11

■ Stabilisation of investment property assets

• Investment property assets continue to stabilise and drive better quality earnings

• Yas Mall set to be fully operational by year end

■ Balance sheet continues to strengthen

• Debt strategy on track following further AED1.1bn payment in quarter

• Collection of AED1.2bn in infrastructure recoverables during the quarter

■ Clear development plan in place

• Strong sales performance across projects

• Abu Dhabi real estate market fundamentals remains supportive

Q&A 12

■ Questions?

Development project summary table As at 30 June 2015

13

¹ Sold units includes all units where a sales purchase agreement (“contract”) has been signed. This does not include sales reservations and pending sales contracts.

² Sold units sales value is the total value of the sold unit contracts. This does not include sales reservations and pending sales contracts.

Project Location Recognition Launch date

Sold units ¹

Sold unit sales value (AEDm) ²

Revenue recognition %

Expected completion

Ansam Yas Island Over-time 2014 472 777 4% 2017

Hadeel Al Raha Beach Over-time 2014 211 420 7% 2017

Nareel Abu Dhabi Island Over-time 2015 30 433 49% 2017

Land plot Khalifa City Point-in-time 2015 1 100 100% 2015

Merief Khalifa City Over-time 2015 274 610 0% 2017

Meera Shams Abu Dhabi Over-time 2015 115 159 0% 2018

Land plot Al Raha Beach Point-in-time n/a n/a 908 0% 2016

Total 1,103 3,407 11%

14

795

302

58

438

44

592

75 9 28 35

648

353

0

100

200

300

400

500

600

700

800

900



New Segmental Performance – H1 2015

AE

D M

illio

ns

(5)

919

285

110 58

17

205

608

72 16 9 4 (5)

692

388

0

100

200

300

400

500

600

700

800

900

1,000

InvestmentProperties

Hotels Schools Operative Villages Leisure Construction Property Dev. &Sales

Old Segmental Performance – H1 2015

AE

D M

illi

on

s

H1 2015 segmental reporting analysis – new and old

Recurring revenues and gross profit of AED1,388 million and AED707 million respectively ¹


¹ Recurring revenues assets include Investment Properties, Hospitality & Leisure, Operative Villages, Schools (Aldar Academies) and Property & Facilities Management (PFM) (Khidmah)

H1 2014 segmental reporting analysis – new and old

15

470

289

72

232

122

313

67 25 27 27

214

0

100

200

300

400

500

600



New Segmental Performance – H1 2014

AE

D M

illio

ns

564

271

98 72

18

137

331

63 17 25 4 1

232

0

100

200

300

400

500

600

700

InvestmentProperties

Hotels Schools Operative Villages Leisure Construction Property Dev. &Sales

Old Segmental Performance – H1 2014

AE

D M

illio

ns

2,753

2,728

¹ Recurring revenues assets include Investment Properties, Hospitality & Leisure, Operative Villages, Schools (Aldar Academies) and Property & Facilities Management (PFM) (Khidmah)



H1 2015 reclassified segmental reporting explanations

16

Old Segment

H1 2015 (AEDm)

New segment H1 2015 New segmental reporting (AEDm)

Net movement (AEDm)

Explanation

Investment properties

Revenue: 919 Gross Profit: 608 GP margin: 66%



Revenue: (124) Gross Profit: (16)

• Khidmah (P&FM) moved from Investment Properties to Adjacent Businesses. Reported revenue and gross profit is reclassified under new Adjacent Businesses segment.

Hotels Revenue: 285 Gross Profit: 72 GP margin: 25%

Hospitality and Leisure


Revenue: 17 Gross Profit: 4

• Leisure has been absorbed into Hotels segment and renamed Hospitality and Leisure

Schools Revenue: 110 Gross Profit: 16 GP margin: 15%

Adjacent Businesses



• New reporting segment consolidating three adjacent businesses – Schools (Aldar Academies), Property and Facilities Management (P&FM) (Khidmah) and Construction business (Pivot)

Operative Villages


Operative Villages


Revenue: - Gross Profit: -

• No change to segment reporting

Leisure Revenue: 17 Gross Profit: 4 GP margin: 24%

n/a n/a Revenue: (17) Gross Profit: (4)


H1 2015 reclassified segmental reporting explanations (cont’d)

17

Old Segment

H1 2014 Reported (AEDm)


Net movement (AEDm)

Explanation

Construction Revenue: 205 Gross loss: (5) GP margin: (2)%

Development Management


Revenue: (161) Gross Profit: 40

• Construction business (Pivot) has been reclassified within new Adjacent Businesses segment in line with group strategy

• Construction segment has been renamed Property management

• Development management fees (ie. Govt projects such as Abu Dhabi Plaza) also reclassified from old Property Development & Sales into new Development Management segment

• National Housing remains unchanged

Property Development and sales





• Development management fees (ie. Govt projects such as Abu Dhabi Plaza) were reclassified into new Development Management segment

Net impact Revenue: nil Gross Profit: nil

• Resegmentation results in nil impact on disclosed revenue and gross profit

H1 2014 reclassified segmental reporting explanations

18

Old Segment



Net movement (AEDm)

Explanation






• Khidmah (P&FM) moved from Investment Properties to Adjacent Businesses. Reported revenue and gross profit is reclassified under new Adjacent Businesses segment.

Hotels Revenue: 271 Gross Profit: 63 GP margin: 17%

Hospitality and Leisure




Schools Revenue: 98 Gross Profit: 17 GP margin: 23%

Adjacent Businesses



• New reporting segment consolidating three adjacent businesses – Schools (Aldar Academies), Property and Facilities Management (P&FM) (Khidmah) and Construction business (Pivot)

Operative Villages


Operative Villages


Revenue: - Gross Profit: -

• No change to segment reporting

Leisure Revenue: 18 Gross Profit: 4 GP margin: 22%

n/a n/a Revenue: (18) Gross Profit: (4)


H1 2014 reclassified segmental reporting explanations (cont’d)

19

Old Segment



Net movement (AEDm)

Explanation

Construction Revenue: 137 Gross Profit: 1 GP margin: 1%

Development Management


Revenue: (15) Gross Profit: 26

• Construction business (Pivot) has been reclassified within new Adjacent Businesses segment in line with group strategy

• Development management fees (ie. Govt projects such as Abu Dhabi Plaza) also reclassified from old Property Development & Sales into new Development Management segment

• National Housing remains unchanged

Property & Development and sales

Revenue: 2,753 Gross Profit: 232 GP margin: 8%


Revenue: 2,728 Gross Profit: 214 GP margin: 8%


• Development management fees (ie. Govt projects such as Abu Dhabi Plaza) were reclassified into new Development Management segment

Net impact Revenue: nil Gross Profit: nil

• Resegmentation results in nil impact on disclosed revenue and gross profit

Project Gazelle – PMO Committee Uploads/IR_Analyst_PPT_Q2-2015.pdf · 2016-02-02 · Net profit...

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