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TECOM GROUP’S Q1 2023 NET PROFIT GROWS 34% TO
AED 255 MILLION AS OCCUPANCY RATES INCREASE FOR
FIFTH CONSECUTIVE QUARTER
• Q1 2023 revenue at AED 514 million, a 6% year-on-year increase on the back of sustained occupancy
levels and high retention rates
• Occupancy rate for commercial and industrial assets reached 87%, the fifth quarter of sequential growth
and a 7% increase from Q1 2022
• Substantial growth in Funds from Operations (FFO1) to AED 359 million, a 44% increase from Q1 2022
• AED 200 million dividend distributed in April 2023, making up a total AED 400 million paid out to
shareholders for H2 2022
Dubai, UAE, 2 May 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
AED ‘000s First Quarter
YoY%
(Unless otherwise stated) 2023 2022
Revenue 513,784 485,111 6%
EBITDA 398,805 349,435 14%
EBITDA Margin 78% 72% 6%
Net Profit 255,133 190,262 34%
Operational Highlights
Commercial and Industrial – As of 31 March 2023 31 March 2022 YoY%
Occupancy Level 87.1% 80.6% 6.5%
Retention Rate 95.4% 94.6% 0.8%
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.
1
Funds from Operations = Cash from operations (including net financing costs and income) before changes in working capitalLooking 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.
---ENDS---Note to Editors:
Definitions
TECOM Group has an integrated portfolio of real estate assets, spread across 10 strategically located business districts
in Dubai. These business districts serve 6 industry sectors. We refer to each sector we serve as a Cluster, which consists
of one or more business districts operating in the same industry.
- Technology Cluster: Consists of Dubai Internet City and Dubai Outsource City.
- Media Cluster: Consists of Dubai Media City, Dubai Studio City and Dubai Production City.
- Education Cluster: Consists of Dubai International Academic City and Dubai Knowledge Park.
- Science Cluster: Consists of Dubai Science Park.
- Design Cluster: Consists of Dubai Design District.
- Manufacturing Cluster: Consists of Dubai Industrial City.
More broadly, the Company provides real estate solutions across three segments: Commercial Leasing, Land Leasing
and Industrial Leasing.
• Commercial Leasing. TECOM Group provides state of the art built-to-lease (BTL) and built-to-suit (BTS)
properties across office and retail spaces including purpose-built business centres and HQs tailored to
customer specifications as well as industry specialised facilities (e.g. sound stages, film studios, university
campuses, lab facilities, etc.). Typically, BTL properties have a lease term of 1 to 5 years and BTS properties
have lease terms of 10 years and over.
• Industrial Leasing. Warehouse space, showrooms and worker accommodation facilities utilised by large
corporates and other businesses to accommodate their employees. Typically, lease terms for Industrial
Leasing are 1 to 5 years.
• Land Leasing. Available land within our various business districts for which infrastructure (e.g. roads, water,
electricity, sewage) is already in place or will be put in place allowing us to lease the land or utilise it for our
planned future investments. Typically, lease terms for Land Leasing are between 30 to 50 years.
TECOM Group also provides an array of value-added government and business services (e.g. visa, immigration,
licensing, etc.) including services promoting individual talent, start-ups and entrepreneurship through our dedicated
platforms axs, in5, gofreelance, marketplace.ae and D/Quarters respectively, as well as advertising, property and venue
management services specific to each industry / district. Collectively we refer to these services as Services & Others.
MEDIA ENQUIRIES INVESTOR RELATIONS ENQUIRIES
TECOM Group P.J.S.C Mutaz Albadri Ghaith Zghaibi
media@tecomgroup.ae ir@tecomgroup.ae
Brunswick Group tecomgroup@brunswickgroup.comTTEECC66MM GGRROOUUPP
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Sentiment: neutral