Aldar Drops to Lowest Since March 2009 as S&P Cuts Credit Rating to Junk
Aldar Declines to March 2009 Low as S&P Cuts to Junk
Matilde Gattoni/Bloomberg
The Souk development by Aldar Properties PJSC stands under construction in Abu Dhabi.
The Souk development by Aldar Properties PJSC stands under construction in Abu Dhabi. Photographer: Matilde Gattoni/Bloomberg
Aldar Properties PJSC dropped to the lowest since March 2009 as Abu Dhabi’s biggest property developer had a third consecutive quarterly loss and Standard & Poor’s cut its credit rating to junk.
Aldar fell as much as 4.9 percent to 2.34 dirhams. The shares traded at 2.39 dirhams as of 10:34 a.m. in Abu Dhabi.
The second-quarter loss was 475.3 million dirhams ($129 million), according to Bloomberg calculations based on first- half data provided by the company. The average estimate of seven analysts was for a loss of 210 million dirhams in the quarter.
The developer’s long-term issuer credit rating was lowered six levels to BB-, the third highest junk ranking, from A- by S&P, citing declining profits and real estate prices. The outlook is negative.
Aldar’s “profitability and cash flow have been significantly affected by, and continue to be under pressure from, challenging real estate market conditions,” the rating company said in a report on July 30. “The downgrade also reflects a revision to our government support assumptions for Aldar.”
To contact the reporters on this story: Zahraa Alkhalisi in Abu Dhabi at zalkhalisi@bloomberg.net
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