Aldar Properties (Aldar) has reported its financial results for 4Q2015. Net income came in at AED735 million (+5.5% Y-o-Y), while revenue came in at AED1,124 million (-11.4% Y-o-Y). 2015 net income totaled AED2,537 million, beating Bloomberg consensus estimate of AED2,030 million, and up 13.5% Y-o-Y. 2015 revenue was AED4,586 million, in line with Bloomberg consensus estimate and down 30.3% Y-o-Y, on a 69.3% drop in revenue from property development, which was partially compensated by a 37.1% jump in recurring income. Gross profit from recurring revenue grew by 35% Y-o-Y to AED447 million in 4Q2015, and by 51% for the full year to AED1,537 million, with margins expanding on the portfolio by 439 bps to 46.4%. This was mainly driven by the stabilisation of key assets including Yas Mall (occupancy rate: 96% in December 2015). Occupancy rate for Aldar’s hotel portfolio is at 79%, in line with 2014. The company’s residential and office portfolios are almost fully leased, with occupancy rates at 98% and 95%, respectively. Management aims to grow its net operating income from recurring sources to AED2.2 billion by 2020, representing 40% growth. Gross debt as of the end of the year fell by 35% to reach AED5,947 million. This comes in line with the company’s policy for debt, setting a ceiling for debt at 35% to 40% of the value of the investment properties and operating businesses. Aldar is looking to extend the duration of some loans, including its USD750 million sukuk, due in 2018. The board has proposed AED.10/share cash dividend for 2015, implying a dividend yield of 4.2% on yesterday’s closing price. Starting 2016, the board plans to recommend to shareholders the distribution of between 65% to 80% of free cash flow from investment properties and 100% owned operating companies. This will be supplemented by a discretionary percentage of the total realised cash profits on the completion of development projects. (Company disclosure, Bloomberg)