Dar Al Arkan Real Estate Development Co. · TADAWUL:4300
Dar Al Arkan Real Estate Development — Q3 2016 Earnings Presentation
27 slides from Dar Al Arkan Real Estate Development's earnings presentation, 2016
Slide 1: Investor Presentation Q3, 2016
Investor Presentation Q3, 2016 www.alarkan.com
Slide 2: Table of Contents
Table of Contents I. Macro-economic & Sector Overview II. Company Overview & Financial Performance III. Company Activities IV. Investment Summary V. Appendix i. P&L ii. Balance Sheet
Slide 3: I. Macro-economic & Sector Overview
I. Macro-economic & Sector Overview
Slide 4: Macroeconomic Overview
Macroeconomic Overview KSA construction industry suffers from the burden of austerity measures taken by the govt. to curb fiscal deficit in 2016. However, stabilizing oil prices and readjustment of the economy to new price levels is expected to bring development spending back online in 2017. • The e
Slide 5: KSA Demographic & Tourism
KSA Demographic & Tourism Despite short term challenges, the fundamentals of young population growing proportionately in size, reducing family size, increasing middle- class and a sizeable affluent population keeps the long-term growth potential for the Real Estate Sector in place. • Majority of the
Slide 6: KSA Real Estate Development
KSA Real Estate Development The aim of the White Land Tax is to increase availability of land within the urban boundaries for development of affordable housing. The first stage of the tax implementation is for end-2016 and will target large undeveloped land plots within planned master developments.
Slide 7: KSA Real Estate Development (Contd.)
KSA Real Estate Development (Contd.) The Saudi Govt. is taking various initiatives to spur housing development in the country by collaborating with other countries and by engaging private investors. National Transformation Plan: Ministry of Housing (MoH): • The National Transformation Program 2020 w
Slide 8: KSA Real Estate Overview
KSA Real Estate Overview KSA Real Estate Market has seen a marked slowdown since the beginning of the year as economic uncertainty impedes growth. Despite introduction of new reforms, investors & buyers remain cautious. • Although KSA real estate market is backed by strong underlying fundamentals in
Slide 9: KSA Real Estate Overview – Riyadh Land Transactions
KSA Real Estate Overview – Riyadh Land Transactions Buyers and Investors continued their cautious stance as they seek attractive entry points to invest in land. • Economic uncertainty and implementation of White Land Tax Riyadh’s Land Transaction Volume continued to take its toll on the land market.
Slide 10: KSA Real Estate Overview – Residential & Office Market
KSA Real Estate Overview – Residential & Office Market Economic uncertainty continues to impact demand for commercial office space. Increase in supply in the short term is expected to put pressure on both occupancy levels and office lease rates. Sale price per sqm for villas and apartments continues
Slide 11: KSA Real Estate Overview – Retail & Hospitality
KSA Real Estate Overview – Retail & Hospitality Retail segment was adversely affected due to lower consumer confidence. Hospitality segment also remained subdued due to lack of leisure and business tourism in the month of July-August. • After showing signs of stability in 1H2016, retail lease rates
Slide 12: II. Company Overview & Financial Performance
II. Company Overview & Financial Performance
Slide 13: Company overview
Company overview Dar Al-Arkan – A leading real estate developer in Saudi Arabia • Largest listed real estate developer in Saudi Arabia Increasing investments in leasing assets As at 30 Sep 2016: 100% 2% • Market Capitalization: SAR 4.8 bn (US$ 1.3 bn) 17% 17% Property management • Total number of em
Slide 14: Financial Performance
Financial Performance Q3, 2016 Profitability Revenue (SAR mn) Recurring Revenue (SAR mn) • Revenue increased 14% to SAR 618 mn (2015, Q3 1,000 40 SAR 541 mn) due to higher land sales. 750 30 • Land sales revenue SAR 583 mn (2015, Q3: SAR 500 924 20 506 mn), higher by 15% due to mix and quantity of 3
Slide 15: Financial Performance … cont’d
Financial Performance … cont’d Q3, 2016 Balance Sheet Cash Flow Q3 2016 (SAR mn) 2,500 • Liquidity Position: Cash balance increased to SAR 1.6 bn inspite of increase in working capital. YoY the cash balance has increased by 2,000 283 626 mn. DAAR is well positioned to meet its 618 upcoming Sukuk rep
Slide 16: Financial Performance … cont’d
Financial Performance … cont’d Q3, 2016 Funding • Net debt stands at SAR 4,483 mn Gross Debt/Capitalization Q3, 2016 Debt Profile (SAR mn) (Q2, 2016 SAR 4,630 mn) gross debt / capitalization stands at 25% 30% 26% 26% 27% 26% 26% 26% 25% 25% • Maturities are well spread and cash Murabaha 30% manageme
Slide 17: III. Company Activities
old y DI sla By DAR ALARKAN Ill. Company Activities
Slide 18: Land Development
Land Development Substantial and Geographically Diverse Land Bank • Land plots are purchased based on thorough analysis : Land revenue & gross margin (SAR Millions) — Target large cities with supply / demand gap 38.7% 44.8% 42.0% 44.2% 45.6% 44.3% 3,000 42.9% 43.0% 43.5% 50% 39.3% — Follow expansion
Slide 19: Properties
Properties Al Qasr Community Al Qasr Mall Others Al-Qasr Community by Numbers Al-Qasr Mall by Numbers Built-up Area (sqm) 1.2mn Built-up Area (sqm) 230k Housing Capacity 13,000 Total # Residential Units 3,051 GLA (sqm) 76k Total # Villas 254 # Leasable Units 429 Total # Apartments 2,797 # Villas for
Slide 20: Residential and Commercial Development
Residential and Commercial Development Shams Ar Riyadh Juman Shams Al Arous and Al Tilal Shams Ar-Riyadh is Dar Al-Arkan’s second Juman is located in Dammam and will be an Shams Al Arous is the Company’s third Master Master Planned Community and is located in integrated, Master Planned community pro
Slide 21: IV. Investment Summary
IV. Investment Summary
Slide 22: Investment Summary
Investment Summary 1 Healthy and growing real 2 3 estate sector in Saudi Arabia Longstanding land price Progress with revenue driven by favorable underlying appreciation with some recent diversification through leasing demographics and continued weakening from macro and off plan sales supportive leg
Slide 23: V. Appendix
old y DI sla By DAR ALARKAN V. Appendix
Slide 24: Financial Performance – Income Statements
Financial Performance i) Income Statements SR in 000s FY 2013 FY 2014 FY 2015 Q3, 2015 Q3, 2016 2015 (9 months) 2016 (9 months) Revenue 2,931,168 3,056,060 2,211,349 540,949 617,571 1,791,995 1,459,735 Cost of revenue (1,778,097) (1,756,805) (1,228,117) (298,790) (372,376) (989,550) (838,249) Gross
Slide 25: Financial Performance – Balance Sheet
Financial Performance ii) Balance Sheet SR in 000s FY 2013 FY 2014 FY 2015 Q3, 2015 Q3, 2016 Cash 2,279,132 2,310,196 1,001,061 950,997 1,577,457 Accounts Receivables 1,364,297 1,747,778 1,948,687 1,954,339 1,717,592 Pre-paid Expenses 484,201 816,697 974,809 987,481 691,964 Project in Progress-ST 44
Slide 26: Disclaimer
Disclaimer THIS PRESENTATION IS NOT FOR PUBLICATION, RELEASE OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, INTO AUSTRALIA, CANADA, JAPAN OR THE UNITED STATES. THIS PRESENTATION IS NOT AN OFFER OR SOLICITATION OF AN OFFER TO BUY OR SELL SECURITIES. IT IS SOLELY FOR USE AT AN INVESTOR PRESENTATION AND IS P
Slide 27: Dar Al-Arkan – Built for Life
1H) {Ht old II yl DAR AL-ARKAN ls BUILT FOR LIFE
Dar Al-Arkan Real Estate Development — Q3 2016 Earnings Presentation on 6ix