TECOM Group announces 34% growth in net profit for Q1 2023

TECOM Group PJSC (DFM: TECOM), (the “Company” or the “Group”), the creator of specialised business districts and vibrant communities, today announced its financial results for its fiscal 2023 first quarter ended 31 March 2023.

The Group delivered a strong financial and operational performance, reporting a 6% year-on-year (YoY) increase in revenues to AED 514 million and a 34% YoY increase in net income to AED 255 million.

Financial Highlights

Operational Highlights

Abdulla Belhoul, Chief Executive Officer, TECOM Group, said:

“TECOM Group’s solid first quarter results, are not just a testament to the success of our long-term growth strategy, but also a reflection of the underlying business confidence in Dubai and the thriving business ecosystem in the emirate.

The sustained growth in our occupancy demonstrates the continued demand for our specialised assets and reaffirms Dubai’s position as a global hub for investment, innovation, and entrepreneurship. We believe we are well positioned to continue to capitalise on the booming real estate market in Dubai.

Looking ahead, our outlook for the rest of the year is positive, particularly with the prospect of higher rental rates, continued growth in occupancy and the immense potential that the city offers to businesses of all sizes and from all sectors. We will maintain our focus on maximising value to our shareholders and all our stakeholders.”

Q1 2023:

- Revenue for the first quarter of 2023 came in at AED 514 million, an increase of 6% YoY that is driven by a significant increase in our commercial and industrial occupancy rates compared to the same period last year.

- EBITDA increased 14% to AED 399 million, primarily driven by top line growth and lower operational expenses.

- Net profit grew 34% YoY to AED 255 million, underpinned by strong growth in revenues, enhanced operational efficiencies and sustained growth across all business segments.

- Funds from operations (FFO) reached AED 359 million, a 44% increase on Q1 2022, due to strong collections and continued high levels of customer retention.

Key Operational Activities

Through its provision of business districts, TECOM Group continues to support many industries that drive Dubai’s diversification agenda and economic growth. In Q1 2023, TECOM Group witnessed:

- The announcement by AstraZeneca on its intention to move to Dubai Science Park with new sustainable offices ahead of COP28.

- The successful launch and first edition of Dubai Fashion Week (DFW), which recorded a 55% increase in RSVP’s compared to the 21st edition of Arab Fashion Week in March 2022. M Normandie French Business School inauguration of its first regional campus at Dubai Knowledge Park

- The opening of THRYVE™ factory, the first 100% plant-based meat factory in the Middle East, in Dubai Industrial City.

- Silver Line Gate Group (one of the Middle East’s leading suppliers of milk powder) announcement to build an AED 200 million manufacturing facility at Dubai Industrial City in line with Dubai Economic Agenda D33, the UAE food security agenda and Make it in the Emirates.

- Al Khayyat Investments breaking ground on its largest fulfilment centre to date in Dubai Industrial City.

Dividend

TECOM Group shareholders approved a dividend payment of AED 200 million, that was paid in April 2023. This follows a AED 200 million pay-out which was distributed in November 2022, taking the total dividend payment for the second half of 2022 (H2) to AED 400 million.

As per the dividend policy set out in the IPO prospectus, TECOM Group is committed to paying a total dividend amount of AED 800 million per annum over the first three years of being a listed company. The next dividend payment will be distributed in September 2023, subject to shareholder approval, and will cover the first half of 2023.

News Source: Dubai Media Office