TECOM Group’s revenue surges 28%

Published: February 10, 2023

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TECOM Group introduced a 12 per cent year-on-year improve in income to AED 1.97 billion and a report 28 per cent progress in internet revenue to AED 725.62 million for the monetary yr ended December 31, 2022.

The outcomes confirmed robust demand for the Group’s business and industrial properties, supported by Dubai’s robust macroeconomic surroundings and buoyant enterprise and client confidence.

Malek Al Malek, Chairman of TECOM Group, stated, “Since our profitable IPO in July 2022, TECOM Group continued to grasp unparalleled achievements, demonstrating stable outcomes and rewarding shareholders with enticing returns.

“As per our declared dividend coverage, we’ve got distributed AED 200 million in money dividends to our shareholders in November 2022. Following our distinctive FY 2022 efficiency, the Board of Directors has really helpful an interim dividend fee of AED 200 million to be distributed in April 2023, which can carry the full dividend to AED 400 million for the second half of 2022.

“We remain committed to distributing a total dividend of AED 800 million per annum in our first three years of being a listed company, subject to the Board of Directors and General Assembly required approval,” he added.

Abdulla Belhoul, Chief Executive Officer of TECOM Group, stated, “The robust progress in our occupancy charges in 2022 signifies a pointy return in demand for high quality business and industrial actual property belongings in Dubai and displays the attractiveness of TECOM Group’s specialist actual property choices.

“I am encouraged by the progress we have made this past year, particularly in increasing the value of our investment property portfolio by nearly 10 per cent, as well as increasing and enhancing our high-quality customer base to reach more than 9,500 including companies and freelancers, which represents a 22 per cent YoY growth,” he defined.

As of December 31, 2022, the occupancy stage for business and industrial belongings was 86 per cent, registering the fourth quarter of sequential progress and a considerable improve from the year-end 2021 occupancy stage of 78 per cent.

Customer retention charges stood at 92 per cent, surpassing market expectations and reaffirming the unparalleled buyer choices offered by TECOM Group.

Over the yr, greater than 1,700 new prospects joined the enterprise districts that cater to 6 completely different strategic sectors – Technology, Media, Education, Science, Design and Industry – with excessive demand for each ‘built-to-suit’ and ‘built-to-lease’ properties.

Earnings earlier than curiosity, taxes, depreciation and amortization (EBITDA) elevated by 15 per cent year-on-year to AED 1.35 billion and the EBITDA margin expanded to 68 per cent in FY 2022, in comparison with 66 per cent in FY 2021.

The greater EBITDA and EBITDA margin was resulting from improved income high quality from all of the completely different enterprise segments and enhanced working bills administration.

Net revenue grew by a report 28 per cent year-on-year to AED 725.62 million, according to the top-line constructive efficiency, which was additionally supported by the resilience of the financial surroundings in Dubai and the upward pattern in its actual property market.

Funds from operations (FFO) stood at AED 1.20 billion, representing a 19 per cent year-on-year improve, a testomony to enhanced operational effectivity throughout all income-generating belongings.

Recurring free money stream elevated to AED 964 million, up 21 per cent year-on-year, on the again of wholesome accounts receivables and efficient money conversion. TECOM Group has a well-balanced portfolio of belongings with short- and long-term contracts, supporting the predictability of money stream.

At the top of 2022, TECOM Group maintained a extremely managed value of debt and wholesome debt profile with a loan-to-value (LTV) ratio of 14.5 per cent and internet debt of AED 3.08 billion.

The sturdy efficiency and general constructive actual property market sentiment resulted in a rise within the honest worth of our funding property portfolio by 9.7 per cent since March 2022 from AED 19.41 billion to AED 21.29 billion.

An enticing annualised dividend yield of seven.1 per cent (based mostly on closing share worth on thirtieth December 2022) is among the many prime returns for shareholders who’ve invested in firms listed on the Dubai Financial Market (DFM).

The Company additionally launched the fourth quarter (This fall) 2022 outcomes. It reported a rise in revenues by 4 p.c YoY to AED 493.66 million resulting from an increase in new prospects and progress in occupancy charges which noticed an eight p.c improve from the identical interval in 2021.

TECOM Group’s high-quality buyer base noticed many new high-profile organisations be a part of certainly one of its specialised enterprise parks and present prospects taking further area to broaden operations.

EBITDA for the quarter stood at AED 260 million and internet revenue at AED 87 million, impacted primarily by elevated depreciation expense following the supply of recent built-to-suit tasks and extra capital expenditure (CAPEX) on the enhancement of present belongings and better working prices on account of the return to regular exercise ranges in comparison with final yr.

TECOM Group offers actual property options throughout three fundamental segments: Commercial Leasing, Industrial Leasing and Land Leasing. The Company additionally affords a spread of value-added companies to facilitate the creation of distinctive ecosystems in its ten enterprise districts for its prospects.

FY 2022 income for the business section elevated by 17 per cent year-on-year to AED 1.06 billion, pushed by a sustained improve in occupancy charges to 85 per cent and robust above-target retention charges throughout all clusters of 92 per cent.

Dubai’s expansionary financial system and robust demand from manufacturing prospects drove greater occupancy and retention charges for each the business and industrial leasing segments.

Land Leasing continues to get pleasure from the identical stage of EBITDA margin at 84 per cent, whereas income marginally decreased by 2.7 per cent in FY 2022. However, the Group maintained a excessive retention price of over 95 per cent, anticipating this section to develop additional over the approaching years according to Dubai’s financial system.

FY 2022 income for the Services and Others section elevated by 19 per cent YoY to AED 216 million, pushed by a robust improve in demand for presidency and registration companies (axs) because of the easing of COVID-19 restrictions and a subsequent improve in new enterprise established in Dubai.

Higher EBITDA and EBITDA margins for the Services & Others section are owed to an enhancing top-line and decrease common and administrative bills resulting from operational effectivity enhancement.

Source web site: www.dubai92.com

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