Dar Al Arkan Real Estate Development Co. · TADAWUL:4300
Dar Al Arkan Real Estate Development — Q1 2017 Earnings Presentation
24 slides from Dar Al Arkan Real Estate Development's earnings presentation, 2017
Slide 1: Investor Presentation Q1, 2017
Investor Presentation Q1, 2017 www.alarkan.com
Slide 2: Table of Contents
Table of Contents Content Page No. 1. Investment Summary 3 2. Macro & Micro Economic Overview 4 2.1 Macroeconomic Overview 5 2.2 KSA Current Housing Market Situation 7 2.3 Government Real Estate Sector Initiatives 8 3. DAAR’s Overview & Strategic Positioning 10 3.1 DAAR’s Overview – Current Operatio
Slide 3: Investment Summary
Investment Summary 1 2 3 A substantial and Longstanding land price Progress with revenue geographically diverse land appreciation with some recent diversification through leasing, bank with rigorous approach to weakening from macro off plan sales, housing and acquisition and current focus on uncerta
Slide 4: 2. Macro & Micro Economic Overview
2. Macro & Micro Economic Overview 4
Slide 5: 2.1 Macroeconomic Overview
2.1 Macroeconomic Overview National Transformation Plan NTP (2020) aims to rebalance and diversify the economy through private sector inclusion. Stabilizing oil prices and NTP to spur the economic growth in 2017 and beyond Oil Price Recovery and Declining Deficit Projected in Over 7% Rise in Budget
Slide 6: 2.2 KSA Real Estate Sector Overview
2.2 KSA Real Estate Sector Overview Medium to long term prospects for real estate seem positive backed by strong fundamentals including, favorable demographics, government support and increased affluence Continuous Reduction in Residential and Commercial Transactions Value Construction Cost Benefitt
Slide 7: 2.2 KSA Current Housing Market Situation
2.2 KSA Current Housing Market Situation Increasing young population in urban centers & work force will increase demand for home ownership in the future thus putting pressure on existing housing supply shortage Total Saudi Population Population Under 29 Home Owners MoH Supply Target Population Home
Slide 8: 2.3 Government Real Estate Sector Initiatives
2.3 Government Real Estate Sector Initiatives The government is keen on enhancing the performance of the real estate sector in the Kingdom and, in coordination with various authorities, is taking various measures, projects and initiatives that support supply and reinforce demand Off –plan sales will
Slide 9: 2.3 Government initiative update during Q1 2017
2.3 Government initiative update during Q1 2017 MOH REDF Number of citizens provided loans by Number of distributed products during Q1 2017 REDF 4,500 2,538 60,000 54,918 4,000 3,500 3,265 50,000 3,000 567 2,346 34,600 1,329 1,339 40,000 2,500 2,000 381 30,000 1,500 142 328 483 Land 1,000 1,942 146
Slide 10: 3. DAAR’s Overview & Strategic Positioning
3. DAAR’s Overview & Strategic Positioning 10
Slide 11: 3.1 DAAR’s Overview – Current Operations
3.1 DAAR’s Overview – Current Operations Dar Al-Arkan is the largest listed real estate developer in the Kingdom of Saudi Arabia, with assets of over SAR 24.5 bn (US$ 6.5 bn), continuously diversifying across the real estate sector. Dar Al Arkan has successfully created a portfolio of recurring as
Slide 12: 3.2 Financial Performance – Q1, 2017 Profitability
3.2 Financial Performance – Q1, 2017 Profitability Historical Quarter Revenue (SAR mn) 800 722 618 600 529 541 419 435 408 410 360 400 200 0 Q1-15 Q2-15 Q3-15 Q4-15 Q1-16 Q2-16 Q3-16 Q4-16 Q1-17 In Q1, 2017 revenue decreased 17% to SAR 360 mn (2016, Q1 SAR 435 mn) driven by slower than expected land
Slide 13: 3.2 Financial Performance – Q1, 2017 Profitability
3.2 Financial Performance – Q1, 2017 Profitability Recurring Revenue (SAR mn) Gross Profit (SAR mn) & Margin (%) 400 60% 40 46% 45% 44% 45% 43% 43% 42% 300 40% 38% 45% 30 20 39 200 30% 33 35 35 37 37 35 37 331 33 229 242 245 10 100 181 191 184 170 15% 136 0 0 0% Q1-15 Q2-15 Q3-15 Q4-15 Q1-16 Q2-16 Q
Slide 14: 3.2 Financial Performance – Q1, 2017 Cash Flow
3.2 Financial Performance – Q1, 2017 Cash Flow DAAR continues to generate cash from operations, reduce net debt and restrict investments to land development Cash Flow Q1, 2017 (SAR mn) 1,500 127 1,000 57 360 138 500 875 582 - Starting Cash Revenue OPEX and Working Debt Repayment Development of Endin
Slide 15: 3.2 Financial Performance – Q1, 2017 Funding
3.2 Financial Performance – Q1, 2017 Funding Gross Debt / Capitalization Q1, 2017 Debt Profile (SAR mn) 40% 30% 30% 26% 26% 25% 25% 22% 22% Murabaha, 39% 20% Sukuk, 61% 10% 0% 2014 2015 Q1-16 Q2-16 Q3-16 Q4-16 Q1-17 • In Q1 2017, Gross debt was 5,224 mn, which reduced marginally • Moody's has upgrad
Slide 16: 3.3 Land Development
3.3 Land Development Geographic Split of Dar Al-Arkan’s Land Bank Land Bank (as a % of total Asset) Others, 2% Makkah, 21% 56% Riyadh, 12% Jeddah, 65% Land Revenue & Gross Margin (SAR Millions) Book Value of Total Land Bank: SAR 13.7 bn 3,000 42.0% 44.8% 50.0% 44.2% 44.5% 39.3% 40.6% DAAR has a di
Slide 17: 3.4 Residential & Commercial Development
3.4 Residential & Commercial Development Parisiana South is a new “for Sale” project that was launched as part of DAAR’s strategy to diversify revenue and provide housing for families in Riyadh. Parisiana South consists of 97 residential units located in the southern part of Al Qasr community ne
Slide 18: 3.4 Residential & Commercial Development – Cont’d
3.4 Residential & Commercial Development – Cont’d Shams Al Riyadh Juman Shams Al Arous & Al Tilal Shams Al-Riyadh by Numbers Juman Project by Numbers Shams Al-Arous by Numbers Total area (sqm) 3.2 m Total Area (sqm) 8.2 m Total net area (sq m) 938K No of Residential units to be 1,160 leased DAAR’s H
Slide 19: 3.4 Property Management & Leasing
3.4 Property Management & Leasing Al-Qasr Mall by Numbers Al-Qasr Community by Numbers Built-up Area (sqm) 230k Built-up Area (sqm) 1.2mn Residence Capacity 13,000 GLA (sqm) 76k Total # Residential Units 3,051 # Leasable Units 429 # Villas for Leasing 102 # Floors 4 # Apartments for Leasing 2,447 Pa
Slide 20: 4. Appendix
4. Appendix old y DI sla By DAR ALARKAN
Slide 21: 4.1 Appendix I – Income Statement
4.1 Appendix I – Income Statement SR in 000s FY 2014 FY 2015 FY 2016 Q1, 2016 Q1, 2017 Revenue 3,056,060 2,211,349 1,870,229 434,607 360,329 Cost of revenue (1,756,805) (1,228,117) (1,079,537) (243,607) (224,636) Gross profit 1,299,255 983,232 790,692 191,000 135,693 % 42.5% 44.5% 42.3% 43.9% 37.7%
Slide 22: 4.2 Appendix II – Balance Sheet
4.2 Appendix II – Balance Sheet SR in 000s FY 2014 FY 2015 FY 2016 Q1, 2016 Q1, 2017 Cash 2,310,196 1,001,061 582,087 1,484,322 874,570 Accounts Receivables 1,747,778 1,948,687 1,839,470 1,573,400 1,662,279 Pre-paid Expenses 816,697 974,809 743,508 977,325 736,727 Developed Land -ST 794,145 437,185
Slide 23: 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 24: {Ht old II yl
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