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TECOM GROUP 9-MONTH NET PROFIT JUMPS 20% WITH
REVENUES INCREASING TO AED 1.6 BILLION
• 9-month revenue increased by 7% YoY to AED 1.6 billion, driven by high occupancy levels across the
portfolio as the Group continues to witness strong demand from existing and new customers
• 9-month EBITDA rose 14% YoY to AED 1.2 billion and the EBITDA margin expanded to 78%, as the
Group continues to realise gains from asset and operational optimisation strategies
• Net profit in Q3 2023 increased by 34% YoY to AED 283 million, demonstrating the Group’s ability to
take advantage of favourable market conditions to continue delivering profitable growth
• The Group will begin the development of new storage & logistics facilities with a total GLA of 200,000
sq.ft. in Dubai Science Park
Dubai, UAE, 31 October 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
the third quarter (Q3) and the 9-month period of the year ending 30 September 2023. The Group
delivered a strong financial and operational performance, reporting a 7% year-on-year (YoY) increase in
revenue to AED 1.6 billion and a 20% YoY increase in net profit to AED 768 million in the first nine months
of year 2023.
Financial Highlights
AED Millions 9 Months %Change Q3 %Change
(Unless otherwise stated) 2023 2022 (YoY) 2023 2022 (YoY)
Revenue 1,590 1,480 7% 541 490 10%
EBITDA 1,234 1,087 14% 410 364 13%
EBITDA Margin 78% 73% 4% 76% 74% 1%
Net Profit 768 639 20% 283 212 34%
Operational Highlights
Commercial and Industrial 30 September 2023 30 September 2022 YoY%
Occupancy Level 88.5% 83.5% 5%
Number of Customers 10,800+ 9,200+ 17%Abdulla Belhoul, Chief Executive Officer, TECOM Group, said: “Our
outstanding financial and operational performance over the nine-month period
reflects our ability to take advantage of Dubai’s favourable market conditions as
we continue to successfully push ahead with our strategy of optimising our
diverse portfolio and sustaining high occupancy rates.”
“Our 10 business districts are almost near full capacity, with our existing
customers continuing to renew their leases with us and new customers coming on board.
This is a testament to the strong demand for our quality assets and unique, fully serviced strategic
locations underpinned by buoyant business conditions. We are very proud of the growing, diverse and
quality customer base we have built and will continue to focus our efforts on being the go-to destination
for international and regional businesses. Furthermore, our business model, which includes a balance
between long-term and short-term leases, enables us to take advantage of rising prices while providing
us with greater revenue stability and visibility.”
Financial Highlights
Nine Months 2023:
• Revenue increased by 7% YoY to AED 1.6 billion, supported by the continued improvement in
occupancy levels and the sustained strong customer retention rates across the Group’s portfolio.
o Occupancy level for commercial and industrial assets reached 88.5% as of 30 September
2023, a notable increase from the 83.5% occupancy rate recorded in the year-ago period.
This was predominately driven by growing demand for quality office space and industrial
storage & logistics facilities.
o The Group saw an increase of 17% in the number of new customers, adding more than
1,600 new customers.
o Customer retention rate stood at 89% by the end of the 9-month period of 2023,
reaffirming the Group’s unique offering and high customer satisfaction rates.
• EBITDA increased by 14% YoY to AED 1.2 billion and the EBITDA margin expanded by 4% to reach
78% in 9M 2023, mainly driven by improved revenue quality and enhanced cost efficiencies, in
line with Group’s strategy to optimise its core business.
• Net profit grew by 20% YoY to AED 768 million in line with the positive top-line performance and
strong growth across all business segments, underpinned by the continued boom that the real
estate market in Dubai is witnessing.
• Funds from operations (FFO) stood at AED 1.1 billion, representing an increase of 22% YoY, driven
by improved operational efficiencies across all assets.
• The Group maintained a healthy debt profile with a loan to value (LTV) ratio of 14.2% and a 7.1x
EBITDA-to-interest ratio, driven by prudent financial management and continued hedging against
rising interest rates.
Q3 2023:
• Revenue increased by 10% YoY to AED 541 million and saw a strong sequential growth since the
beginning of the year as the Group continues to take advantage of the favourable commercial
real estate market conditions in Dubai.• EBITDA rose by 13% YoY to AED 410 million and the EBITDA margin increased to 76% in Q3 2023,
impacted by the positive top-line performance and enhanced operational efficiencies.
• Net profit for the three-month period increased by a remarkable 34% YoY to AED 283 million,
underpinned by the strong growth in revenues, lower operational expenses and lower financing
costs which was supported by the recent refinancing of the loan facility at lower margins and
more favourable terms.
Project Development Highlights
Given the demand surge for Grade A storage & logistics spaces across Dubai, the Group will develop new
storage & logistics facilities with a total GLA of 200,000 sq.ft. in Dubai Science Park.
---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 six 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 Group 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 one to five 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 one to five 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, startups 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 Mutaz Albadri Ghaith Zghaibi
media@tecomgroup.ae ir@tecomgroup.ae
Brunswick Group tecomgroup@brunswickgroup.comr
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Sentiment: positive