manazel real estae pjsc investor presentation …the part of manazel real estate (mre) and its...
TRANSCRIPT
Private & Confidential
October 2018
11
Disclaimer
This presentation contains information based on forecasts and roll outs, all statements contained in this presentation are made without responsibility on
the part of Manazel Real Estate (MRE) and its subsidiaries (including directors, officers and employees) or its advisors. All statements made in this
presentation are based on expectation and are subject to a number of uncertainties and risks that could differ materially from any expected outcome
expressed or implied in these statements.
None of the statements contained in this presentation is to be relied upon as a statement or representation of fact. All parties must satisfy themselves as
to the correctness of each of the statements contained in this presentation.
Manazel Real Estate (MRE) and its subsidiaries (including directors, officers and employees) or its advisors do not have any authority to make or give, any
representation or warrantyor guarantee, whatsoever in relation to this presentation.
This presentation may not be copied, distributed, transmitted, reproduced or stored, in whole or in part, in any form or medium without the express
permission of Manazel Real Estate PJSC.
Building Communities Together
Manazel At-a-Glance
4
Introduction to Manazel
A unique fully integrated real estate developer in the UAE with a focus on the underserved middle class
in the UAE
High Quality Diversified Properties
Development Projects
Investment Portfolio
Al Reef Retail Area
Cooling, and Facilities and Development Management
2,000+
Units in the Pipeline*
Invest Portfolio Valuation
Affordable / Underserved /
Local Population
5,000 +
Residential units delivered
> 130,000 Sqm.
Retail GLA
Issued Capital
$715m
$236m Revenue | $62m EBITDA
FY 2017
Market Cap
$330mn
Over 7500 Units delivered across 8
Projects since inception
UAE & MENA
5
Currently managing all of Manazel Real Estate’s
projects by offering a multitude of facilities management
services serving all classes of the real estate sector with
customers across Abu Dhabi.
Efficient cooling solutions for large commercial and
residential developments
Plants are currently operating at 50% capacity with the
option to scale-up without any incremental CAPEX
Large, landmark projects developed across Abu
Dhabi, the capital of UAE
Niche market targeting affordable housing
Integrating development business to ensure
steady cash flow and controlled capex
Portfolio of strategically located properties with high
cumulative gross rental yield of
Utilization across key retail / mall assets expected to
grow significantly
Expansion of assets across education and healthcare
Business Overview
Strategically aligned business verticals capture opportunities across the real estate value chain
Retail and Commercial
Assets
Build to Lease Residential
Assets
Manazel Healthcare
Manazel Education
Investment Properties
Development
District Cooling
Facility Management
Providing comprehensive administrative services
covering all aspects of real estate consultancy,
design and implementation of related procedures
including property sales services, resale, leasing
and management
Property Management
Government sponsored housing development scheme
Manazel’s involvement limited to development of
allotted land plots for landed (villa) style housing for the
beneficiary families
Others
Development
Management Fee
Dari Initiative
66
Evolution and Key Milestones
Incorporation
of Manazel
Real Estate
Development Execution / Recurring Revenue Creation Phase
Delivering launched projects
Raised equity through market listing
Expanding into new segments like education,
healthcare, etc
Entering into strategic partnerships for future
development
Reached Gross Asset size of ~AED 5bn
Launch of Al Reef 1
Project, Dunes Village, and
Prestige Towers
Launch of Al Reef Cooling
and Capital Cooling project
Completion of Dunes
Village
Hand over of the first phase
of the Al Reef 1 Villas
Launch of Capital Mall
Hand over of all the villas in Al Reef 1
Handover of Al Reef Downtown
Completion of Al Reef Cooling and Capital
Cooling
Delivery of Capital Mall
Listed on ADX Secondary Market
Launch of Al Reef 2
Launch of Ghantoot Waterfront
Participated in the government’s Dari initiative
Creation of Manazel Education
BOT for Manazel Medical City
Initial Years Launching new projects and
commencing development
Focus on creating a brand name
and a niche for itself
Recurring Revenue Asset Delivery /
Growth Phase Delivery of existing projects providing recurring
cash flows for future growth
Low risk high returns approach: De – risked
development strategy
Focus on operational efficiency, returns & cash
flow optimization
Transformed the business over the years from a pure developer to a well diversified company with a
strong focus on recurring revenue
Policy, Governance and Strategy
88
Strategy Overview
Growing Recurring RevenuesDe-Risked
Development Strategy
Access to Diversified Sources
of Funding
Build on the existing
investment portfolio &
services businesses
Develop the portfolio using
“Build Operate Transfer”
model
Further diversify recurring
revenue sources by
undertaking minimal capex
Co-Development and
Preselling is the key
strategy in development
Landlord to be paid on
completion of the Co-
Development Project
Capital commitment only
after the Pre-selling
threshold is reached
Diversification of capital
structure to optimise
investments
Strong relations with local
& regional banks to support
growth
Conserve cash and enhance
liquidity to capitalise on the
market opportunities
1 2 3
Ensures long term cash flow visibility while maintaining growth and conserving cash
9
Growth Drivers – Recurring Revenues
9
Expand Property Management and Facility Management operations to offer additional services (house
maid services, parcel services etc.,) and catering to third party projects
Entry of cinemas and new retail operators coupled with new developments in the surrounding areas
(defense colony) would lead to increased customer footfall in the Capital mall
Increase capacity utilization of capital cooling by tapping into the new hospital and mall development
Build on the existing investment portfolio and services businessesA
Deploy capital to develop an asset with a long term recurring revenue potential
Leveraging on our expertise of developing residential assets, enter into “Build to Lease” segment
Al Reef 1 and Al reef 2 schools being developed with a long term operator agreement - revenue being
generated through land lease and asset rental
Further diversify recurring revenue income stream – minimal capexC
Schools
Develop long term revenue generating asset with minimal capital deployment
Manazel healthcare project agreement finalized to develop hospital
Al Reef commercial plot leased under BOT agreement for clinic development
Develop the portfolio using “Build Operate Transfer (BOT)” Model – Zero capexB
Manazel
Healthcare
Commercial
Plots
Leased
Residential Assets
Increased focus on developing recurring revenue generating streams with minimal investment
10
Credit Highlights: Future De-Risked Development Strategy
Manazel
Strategy
Key
Advantages
DevelopPre-SellAcquire Land
Leverage existing land bank
(And)
Co-Development agreement
Minimal capital required to
purchase the land
Accommodates both build to
sell and build to lease models
Total contractor cost is
capped
Always in the money if directly
constructing on behalf of land
owner
Flexibility to time the project
completion to optimise unit
sales
Enough cash flows to pay the
contractor
Ensure pre-selling
benchmark of 20-30% is
reached
Lumpsum turnkey contract
with Main Contractor
(Or)
Manage construction on
behalf of the Land owner
A B C
Co-development, pre-selling and lump sum turnkey contracts to ensure minimal cash flow risks
1111
Organizational Structure
* An MOA exists between Tatweer and Manazel giving Manazel rights to operate the companies on behalf of the shareholders of Tatweer, both of which are Directors on the Board of Manazel
Centralized treasury function – cash pooling across the group’s subsidiaries with all debt at the Manazel
Real Estate level
Manazel Real
Estate
PJSC (Mnz)
Al Reef Capital Real
Estate LLC
Capital
Cooling LLC
Manazel
International Capital
UAE LLC
Manazel
International
General Contracting
LLC
Manazel Malls
LLC
Edara Management
LLC
Census International
LLC (Census)
Al Reef
Cooling LLC
The Outlet Capital
Mall LLC
Manazel Capital Real
Estate LLC
Manazel Healthcare
LLC
Al Manzel Real
Estate LLC
Manazel Hospitality
LLC
The Guard Public
Security Guarding
Service LLC
Tatweer Capital
LLC* (Twr)
Mohamed Mehanna Betti Hazim Alqubaisi (50%)
Khalid Abdulla Khalifa Deemas Alsuwaidi (50%)
Manazel Specialists
Real Estate LLC
Ownership
Mnz –51% Twr –49%
* An MOA exists between Tatweer and Manazel giving Manazel
rights to operate the companies on behalf of the shareholders of
Tatweer, both of which are Directors on the Board of Manazel
Ownership
Mnz –99% Twr –1%
Ownership
Mnz –99% Twr –1%
Ownership
Mnz –99% Twr –1%
Ownership
Mnz –99% Twr –1%
Ownership
Mnz –100%
Ownership
Mnz –99% Twr –1%
Ownership
Mnz –99% Twr –1%
Ownership
Mnz –99% Twr –1%
Ownership
Mnz –99% Twr –1%
Ownership
Mnz –60% Twr –40%
Ownership
Mnz –99% Twr –1%
Ownership
Mnz –99% Twr –1%
Ownership
Mnz –100%
Ownership
Census –100%
Companies related to recurring revenue streams
Companies related to development revenue streams
1212
Leadership – Board of Directors & Senior Management
Steered by H.E. Mohamed M.
Al Qubaisi, the Board of
Directors is comprised of
experienced professionals
with a diversity of experience
and knowledge
The Board is responsible for
future business strategy
The members meet on a
periodic basis to review the
implementation of the
business strategy and to
compare it with the ever-
changing external business
environment
Business supported by
Corporate Governance
Committees including
Executive and Risk
Management, Nominations &
Remunerations, and Audit
committees
Mohamed M. Al Qubaisi
Chairman
Khalid Deemas Al
Suwaidi
Board Member
Naser Al Mur Al
Zaabi
Vice Chairman
Mohamed Thaloob
Al Derei
Board Member
Khalid Ali Mansoori
Board Member
Waleid Gamal Eldien
Chief Investment & Commercial Officer
Balaji Prasad
Chief Financial Officer
Yaqoob Al Doseri
Chief Executive Officer
Amal Ghani
Chief Business
Support Officer
Amal Hasan Abu
Shallakh
Chief Projects &
Government
Communications
Officer
Masood Al
Hammadi
GM for Census
Mohamed Ali
Elsherbini
Head of Internal
Audit and QMS
Management
Representative
Saeed Al Khazraji
General Manager
of Manazel
Specialties
Fawaz Al Ameri
General Manager
of Manazel MallsKhalid Al Falasi
Chief Operating
Officer
Asef Nabil Mustafa
Al-Barghothi
Head of
Performance
Enhancement and
Quality Assurance
Ma
na
ge
me
nt
Bo
ard
of
Dir
ecto
rs
Experienced Board Members having access to Abu Dhabi leadership; Seasoned Management Team
With Unparalleled Industry Experience
13
Our Core Values
Co
mm
itm
en
t to
Qu
ali
tyT
ran
sp
are
ncy
We serve as dedicated land administrators,
creating lasting value through our communities
and investment properties to ensure a
prosperous legacy for generations to come.
We remain on par with leading developers across
the region by adopting international best
practices and working with likeminded partners.
We aim to weave vibrant environments that
balance security, comfort and convenience where
people can thrive in self-sufficient communities.
By acting as an equal opportunity employer, we
create job opportunities that contribute to the
social and economic development of the UAE and
support nationals working in the private sector.
To succeed in creating
sustainable communities, we
invest in and manage assets that
adhere to the highest standards
of quality and service.
Our corporate culture is built
on the pillars of ethics, honesty
and openness in everything
we do.
1414
Supportive Recent Developments
Impact on Manazel:
Potentially increase demand for homes among
the local population
In recent attempts to spur growth in the Property Development
Industry, an AED 50bn stimulus package has been declared by
the UAE government that is expected to ease business in the
area and allow for a boost in industry supply factors
1
Impact on Manazel:
Scope to tap into a new segment of customers
New Residency Regulations, allowing expat to be granted 10
year visas and own 100% of businesses, are expected to
increase demand for residency units as well as office units
2
Impact on Manazel:
Manazel has the resilience / optionality to wait
and watch given its unique operating model
Real Estate prices are currently sluggish, with rental prices of
residential and commercial properties seeing a 10% drop in the
first quarter of 2018. However, with recent stimuli packages, the
industry is expected to bounce back and see profitable growth
in the following year
3
“Abu Dhabi’s AED 50 billion economic stimulus package will lead to initiatives that will propel the real estate
market. The new government economic stimulus package has positive implications for the capital with new
initiatives directly impacting the real estate market and as with previous government stimuli should lead to an
upswing in investment”
Peter Stebbings, National Director and Head of Abu Dhabi, JLL, July 2018
Government remains committed to provide stimulus to the economy which will benefit Manazel
Distinguishing Strengths
16
Key Highlights
Integrated
Business Model
Supporting
Increased
Recurring Revenue
Strategic Access
To Land
Development Track
Record
Future De-Risked
Development
Strategy
Competitive
Position Against
Other Operators
in the Market
Leadership /
Corporate
Governance
Projects delivered on / ahead of
schedule
Government housing initiatives
require delivery on time (and within
budget)
Servicing the real estate sector across
the value chain
Focus on recurring revenue streams;
Service-provider model
Cater to a niche market
segment
Nimble and agile; Adapt
to evolving landscape
Strategic support from
the government
Longstanding leadership
with in-depth experience
of the industry
A diverse and
independent board of
savvy leaders
Co-development model ensures
minimal capital investment
Strategic focus on industry-leading
management services to increase
share of recurring revenue pool
Supportive shareholder base with
access to large, strategically located
pockets of land
1717
Key Highlights: Development Track Record
Development Delivery Track Record
Residential Development Delivery Track Record (Number of Units)
942
107
1,005
610 587
67
48
776
648
34650 100
400460
1,049 1,005
658
1,363
715
346450
560
2009 2010 2011 2012 2013 2014 2018E 2019F
Dune Village Al Reef Villas Al Reef Downtown Dari Al Reef 2
Strong execution track record across segments
2010 2012 2013 2014 2016 20182009
18
Key Highlights: Integrated Model Supporting Recurring Revenue
Expand Property Management and Facility Management operations to offer additional services (house
maid services, parcel services etc.,) and catering to third party projects
Entry of cinemas and new retail operators coupled with new developments in the surrounding areas
(defense colony) would lead to increased customer footfall in the Capital mall
Increase capacity utilization of capital cooling by tapping into the new hospital and mall development
Build on the existing investment portfolio and services businessesA
Deploy capital to develop an asset with a long term recurring revenue potential
Leveraging on our expertise of developing residential assets, enter into “Build to Lease” segment
Al Reef 1 and Al reef 2 schools being developed with a long term operator agreement - revenue being
generated through land lease and asset rental
Further diversify recurring revenue income stream – minimal capexC
Schools
Develop long term revenue generating asset with minimal capital deployment
Manazel healthcare project agreement finalized to develop hospital
Al Reef commercial plot leased under BOT agreement for clinic development
Develop the portfolio using “Build Operate Transfer (BOT)” Model – Zero capexB
Manazel
Healthcare
Commercial
Plots
Leased
Residential Assets
Increased focus on developing recurring revenue generating streams with minimal investment
19
Key Highlights: Competitive Position Against Peers in the Market
Manazel Real Estate Other Real Estate Players in UAE
Stable Business
Profile
Business profile benefitting from a good mix of development,
recurring, and services revenue
Presence in multiple segments provides diversity (healthcare, schools,
development management)
Only bigger players in the market have similar business mix; other
players primarily focused on one category
Most players have lower segmental diversification (like others don’t
typically do development management)
Integrated Business
Model
Customer engagement goes beyond development – feeds into
ancillary / stable revenue businesses
Most players are not involved with the project post the handover /
delivery – greater development risk
Scale Right size enables us to be “light weight” and “agile”, providing us
flexibility to react to market conditions quickly
Other players need to continuously undertake projects irrespective
of the market conditions to constantly feed the cash flows
Unique Market
Positioning
Focused on the underserved affordable segment - stable customer
base of the local population
With UAE Nationals now being the top investor in the UAE market, this
strategy bodes well for Manazel
Almost all other players are primarily focused on expat population /
international investors which are less stable in nature / prone to react
to external shocks
Safeguarded from FX
Risks
Given the local population focus, FX movement does not change their
appetite for local market investing
Expats / foreign investors tend to divert funds outside UAE say in case
of a strengthening dollar
Differentiated
Development
Strategy
Development activity primarily revolves around plot / villa sales or low
rise buildings
Provides capex flexibility as the entire structure need not be
completed for handover
Easier to build structures – project gets completed faster plus is less
complex
Other primarily focused on high rise buildings – can only handover
the project upon completion and not in phases – less capex flexibility
Complex projects at times leading to cost over runs or delays
Prudent Land Bank
Strategy
All existing land bank bought from equity
Using our land bank to create recurring revenue assets
Access / relationship with strong network of third parties having large
land banks
Co development model ensures regular development while minimizing
cash flow impact on Manazel
Only bigger players have access to cheap / free land bank primarily due
to their government ownership – however, now even they are finding it
difficult to access cheap land
Others use land bank to build and sell
Others have to invest in expensive land bank upfront to maintain
their development activity
Access to Leadership Well connected Board Members provides easy access to Abu Dhabi
leadership / key decision makers
Only bigger players enjoy similar access in the market owing to
government ownership
Our resilient business profile provides us with a strong competitive advantage
2020
Key Highlights: Strategic Access To Land
Current Land Bank (Manazel)
Existing land bank of Manazel
Name Type Development Plan Revenue Type
Ghantoot Waterfront Residential Co-Development Development
Dubai Silicon Oasis Residential Co-Development Recurring
Yas Tower Residential Co-Development Recurring
JVT - twin towers Residential Co-Development Recurring
Dubai Maritime Tower Residential Co-Development Recurring
International Markets
– KSAResidential Co-Development Development
International Markets
– JordanResidential Land to be Sold Land to be Sold
Healthcare - Hospital Healthcare BOT model Recurring
Healthcare –
Residential Tower
Healthcare /
Residential
PROPCO/OPCO
ModelRecurring
Al Reef 1 – Schools CommercialPROPCO/OPCO
ModelRecurring
Al Reef 2 - School CommercialPROPCO/OPCO
ModelRecurring
MBZ – Phase 3 Commercial To be finalized To be finalized
Primarily our existing land bank is located in Abu Dhabi, apart from
one plot of land in Amman (Jordan)
Part of the land bank will be used to develop new projects as
highlighted in the table alongside
Existing land bank is sufficient to meet our requirements for the
next few years – no new land bank purchases envisaged in the
near term
Strategic relationship with key shareholders and other large land owners providing access to a large land
bank across UAE and GCC
Overview of Key Assets / Performance
Track-record
22
Asset Overview: Capital Mall
Consists of three stories of premium retail
space
Easy accessibility and parking space for 3,000
vehicles
Houses the largest ‘Lulu’ hypermarket in
GCC
Entered into a strategic partnership with
McARTHUR + COMPANY to lease and
manage the mall
Manazel’s first retail project Well located between E30 and E22 highway in Abu Dhabi
Easy access for the target population of ~ 1mn value conscious consumers within a
20 minute radius
Etihad accommodation (Mazyad) and Villas in Mohammed Bin Zayed City (MBZC) are
already occupied
An Army Officers housing colony is coming up next to the Mall (expected to be
completed by 2020)
From a long term perspective, further development of MBZC and potentially the start
of the development of Madinat Zayed area will boost the population of nearby areas
Primary trade area includes a broad mix of nationalities / income levels
Year of
Completion:2013
Units
available: 296
Total Area: 60,158 Sqm.
Leased: 57% (currently)* - additional 25%
under active negotiation
Capital Mall / Prestige Tower
2323
Asset Overview: Prestige Twin Towers
Year of Completion: 2010
Total Area: 55,000 Sqm.
Leased: ~90% (2017)
20-floors twin building structure with leasable office space of over 55,000
Sqm.
Proximity to Dubai and ample parking space act as key differentiating
factors as is reflected in high occupancy
Prestige Twin Towers, Abu Dhabi
Diversified tenant mix with high occupancy; Mature asset with stable cash flows
Company’s first commercial project
Top Tenant
Lease Expiry (% Revenue)
Out of the two towers, P 16 is fully occupied by Abu Dhabi Food Control
Authority (ADFCA)
Company is under a long term lease with the existing contract expiring in
2022 only – provides cash flow visibility
ADFCA has spent considerable sum in fitting out the tower as per its
needs
Other factors like ample parking space and proximity to Dubai also
helps us in retaining this key tenant
0.8% 2.9% 2.0%
94.3%
2018 2019 2020 2021 2022
Prestige 16 is fully leased out to a government entity (Abu
Dhabi Food Control Authority) under a long term contract – while
this tower has been sold by Manazel to multiple investors, the lease
is managed by Manazel on their behalf
Manazel collects the revenue and passes it on to the investors
after deducting its share
Prestige 17 is partially owned by Manazel – we only manage
owned units
Houses Manazel and some of its subsidiaries, as well
Currently 89% occupied, we are in advance talks with companies for
leasing out additional 6% area this year
2424
Property Development - Dari National Housing Program
Salient Points Revenue (AED mn)
Established to meet the high
demand for UAE Nationals housing
opportunities, Dari allows nationals to
utilize AED 2 million housing grant
from the Abu Dhabi Government
Well received with ~600 UAE nationals registered currently
Second phase launched in 2017 includes all existing ten models
redesigned to suit smaller spaces
Average price: AED 2mn for normal and AED 2.5mn for large
Dari National Housing Program, Abu Dhabi
Manazel is one of the few approved developers by the government
under the Dari initiative in Abu Dhabi
Underserved market - bigger developers are less keen in actively
participating given the villas are spread out instead of being in one
location – provides greater participation opportunity for players like us
We initially participated with a pilot program of 15 villas – helped
us understand the process and challenges involved; process is now
streamlined enabling us to undertake higher number every year
Apart from the fixed price paid by the government, additions to the
Villa by the owner over and above the approved plan leads to higher
cash flows
100
200 200 200
2018E 2019F 2020F 2021F
Dari profits are akin to a recurring cash flow for Manazel given the strategic nature of the project
In a Turn-key operation Dari supervises all aspects of the
project until handover
2525
Delivered Projects
Al Reef Villas, Abu Dhabi
Year of Completion: 2014
Units available: 2,376
Total Area: 567,285 Sqm.
Amongst first integrated residential communities in Abu Dhabi:
Comprised of 2,376 villas and townhouses with two, three and
four bedroom options
Designed to accommodate 16,700 residents
All villas handed over to investors in phases by 2014
Al Reef Downtown, Abu Dhabi
Year of Completion: 2014
Units available: 1,818
Total Area: 279,349 Sqm.
Part of the overall Reef community:
Comprised of 46 apartment buildings with 1,818 apartments in a
mix of studio, one, two and three bedroom units
Al Reef Retail is also part of this complex
Handed over to investors in phases by 2014
Dunes Village, Dubai
Year of Completion: 2009
Units available: 942
Total Area: 94,758 Sqm.
Company’s first project in Dubai:
Features 19 five-story residential buildings
Comprised of 942 stylish and spacious studios, one and two
bedroom apartments.
Handed over to investors in 2009
High quality development delivered on time and within budget
2626
Ongoing Projects
Project delivery will result in substantial cash flows to Manazel over the next 6 – 12 months
Situated between Abu Dhabi and Dubai
Ghantoot Waterfront, Abu Dhabi
Year of Completion: 2021
Units available: 671 (plots)
Total Area: 1.4mn Sqm.
One of the biggest real estate projects in the tourism sector in the country
Concept designs of the waterfront project consists of resort style villas
(ocean view) with dedicated water front
Announced in February 2017, the project will utilize Manazel Specialists
with the sale of the 671 land plots in phases
Signed bulk deal in June 2018 for ~10% of the plot value
Step 1 –
Development
Management
Provide consultancy
fee for the
development / overall
plan for the plot going
forward
Non cyclical revenue
not linked to
development activity
Step 2 –
Plot
Sales
Focus on developing
and selling individual
plots initially in a
phased manner
Total of 671 plots to
be sold over a period
of 4 years
Step 3 –
Villa
Construction
Offer villa
construction
services to the plot
owners post
handover
Ensures extra
revenue on the
existing asset
Al Reef 2, Abu Dhabi
Year of Completion: 2019
Units available: 860
Total Area: 440k Sqm.
Second phase of the highly successful Al Reef project
Strategically located on the Abu Dhabi – Dubai highway, close to KIZAD
and Khalifa Port
Will consist of 860, 2 & 3-bedroom villas, four community centers, retail
facilities and a school
Has advanced facilities to ensure a clean and sustainable environment
Salient Points
~97% sold; handover ongoing – (all villas in almost full construction
phase with final finishing being undertaken)
~95% villas sold to UAE Nationals
Project was ~30% pre sold before construction began
Co development project – on the back of successful completion of this
project, Manazel was awarded the Ghantoot Project
Delivered on time and within budget by the contractor (Fibrex) – fixed
lumpsum contract with the contractor
27
Management Services – Source of Recurring Revenue
Facility
Management
Census International is a facilities management company currently managing all of Manazel’s projects by offering a multitude of
services serving all classes of the real estate sector
Acquisition of Non-controlling stake in 2014 allowed Manazel to strengthen cash flows, improve operational efficiencies and
increase profitability
A subsidiary of Census also offers “Guard Security” services to Manazel’s projects as well as to others
Acting as the in house facility management arm, Census gets access to all of Manazel’s developments thereby ensuring
continuous and stable revenue streams
Census has three primary revenue streams: Services to House Owner’s Association (maintenance charges for common areas);
Clients inside Community (charges on per unit basis for services availed by individual units); External projects (revenue from
contracts with third parties)
Property
Management
Full service portfolio management company providing life cycle and comprehensive administrative services covering all
aspects of real estate consultancy, design and implementation of related procedures
Also offers property sales services, resale, leasing and management
Acquisition of Non-controlling stake in 2014 allowed Manazel Specialists to pursue its long term strategy – allowed Manazel to
strengthen cash flow, improve operational efficiencies and increase profitability
Acting as the in house property management arm, Manazel Specialists gets access to all of Manazel’s developments thereby
ensuring continuous and stable revenue streams
District
Cooling -
Capital
Cooling and Al
Reef Cooling
Capital Cooling - As Capital Mall’s occupancy increases and the surrounding vacant land is developed (Medical City), the
plant is expected to operate at its full Capacity
Caters to the Capital Mall and Prestige Towers currently; Sufficient capacity to service upcoming new projects;
Revenue has a fixed component (demand charge – increased considerably in 2018) as well as variable (consumption charge)
Monopoly position – no alternative to consumers
Al Reef Cooling (Al Reef Downtown and Retail area only) - Mature asset providing stable long term cash flows
Fully utilized – running on 100% capacity
Revenue has a fixed component (demand charge – increased considerably in 2018) as well as variable (consumption charge)
Monopoly position – no alternative to consumers
Multiple sources of recurring revenue stream provide long term cash flow visibility
Financial Summary
29
Financial Overview Section
Robust financial performance; Improving margins, expanding asset base
Margins higher for the business (US$m) Profit for the year (US$m)
235202 203 205
236
48 63 67 70 87
21%
31%33% 34%
37%
0%
10%
20%
30%
40%
0
50
100
150
200
250
2013 2014 2015 2016 2017
Revenue Gross Profit Gross Margin (%)
52
42
5457
60
0
10
20
30
40
50
60
70
2013 2014 2015 2016 2017
Bank balances and cash (US$m)
19
74
49
36
0
10
20
30
40
50
60
2013 2014 2015 2016 2017
Development work-in-progress (US$m)
80
55
72
5247
0
10
20
30
40
50
60
70
80
90
2013 2014 2015 2016 2017
Total assets and equity (US$m)
1,041 994
1,154 1,288
1,363
611 552
712 768
572
0
200
400
600
800
1,000
1,200
1,400
1,600
2013 2014 2015 2016 2017
Total assets Total equity
30
Financial Overview Section
Robust financial performance; Strong balance sheet
Consolidated income statement (US$m) Consolidated statement of financial position (US$m)
72 73
113
142
22 21 34
63
12 9 15
36
0
20
40
60
80
100
120
140
160
H1/15 H1/16 H1/17 H1/18
Revenue Gross profit Profit for the period
1,056 1,177
1,316 1,385
493 456 561 560 563
721 755 825
0
200
400
600
800
1,000
1,200
1,400
1,600
H1/15 H1/16 H1/17 H1/18
Total assets Total liabilities Total equity
[ - ] (US$m)
72 73
113
142
21 17 25
48
129
15
36
0
20
40
60
80
100
120
140
160
H1/15 H1/16 H1/17 H1/18
Revenues EBITDA Net Profit
Total assets and shareholders equity (US$bn)
1.0
1.21.3
1.4
0.6
0.7 0.70.8
0.0
0.2
0.4
0.6
0.8
1.0
1.2
1.4
1.6
H1/15 H1/16 H1/17 H1/18
Total Assets Shareholders Equity
3131
Government Receivables
Background
As part of our development
plan for Prestige Tower and
Capital Mall, we also
developed the
infrastructure around the
area like roads, etc
Government receivables
pertain to the
reimbursement of this
infrastructure cost that we
undertook
Total receivables of AED
560mn, out of which AED
70mn received earlier
(outstanding AED 491mn
Government Agreement Recent Developments Expected Scenario
Asset agreements signed
under which these
infrastructure assets were
transferred to the
government with the last
one being signed in 2017
Since then the government
has taken over the assets
In a meeting held with the
government representatives
around two weeks back, we
were informed that the
payment of this
receivable will happen as
part of the AED 50bn
stimulus announced by the
government
Post the discussions with
the authorities, Manazel is
expecting to receive AED
90mn soon.
Remaining receivables also
expected to be paid at the
earliest – option of
receiving both cash and /
or land; receipt of any land
will be based on a mutual
agreement between the two
parties
Not factored in the
forecasts – will result in
windfall gain
Positive development on the receipt of government receivables – however, not factored in the model
