EMAAR DEVELOPMENT PJSC — Regulatory Filings 2022

May 13, 2022

UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE PERIOD ENDED 31 MARCH 2022

Unaudited Interim Condensed Consolidated Financial Statements For the period ended 31 March 2022

Table of Contents

	Pages
Report on Review of Interim Condensed Consolidated Financial Statements	1 – 2
Interim Condensed Consolidated Statement of Comprehensive Income	3
Interim Condensed Consolidated Statement of Financial Position	4
Interim Condensed Consolidated Statement of Changes in Equity	5
Interim Condensed Consolidated Statement of Cash Flows	6
Notes to the Interim Condensed Consolidated Financial Statements	7 – 27

INTERIM CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME For the period ended 31 March 2022 (Unaudited)

(US\$ 1.00 = AED 3.673)

	Notes	Three-month period ended
		31 March 2022 AED'000 (Unaudited)	31 March 2021 AED'000 (Unaudited)
Revenue Cost of revenue	4 4	3,568,141 (2,051,493) __	3,847,647 (2,335,032) ___
GROSS PROFIT		1,516,648	1,512,615
Selling, general and administrative expenses Finance income Finance cost Other income Share of results of joint ventures	5 6(a) 6(b)	(335,772) 40,644 (71,321) 20,012 56,028	(442,914) 7,854 (54,503) 3,061 61,450
PROFIT FOR THE PERIOD		__ 1,226,239	__ 1,087,563
Other comprehensive income		- __	- __
TOTAL COMPREHENSIVE INCOME FOR THE PERIOD		1,226,239 ═══════	1,087,563 ══════
ATTRIBUTABLE TO: Owners of the Company Non-controlling interest		1,050,378 175,861 ──────	780,890 306,673 ──────
		1,226,239 ═══════	1,087,563 ══════
Earnings per share attributable to the owners of the Company: -basic and diluted earnings per share (AED)		0.26 ══════	0.20 ══════

			$(US$ 1.00 = AED 3.673)$
		31 March 2022	31 December 2021
	Notes	AED'000	AED'000
		(Unaudited)	(Audited)
ASSETS
Bank balances and cash	$\mathcal{I}_{\cdot}$	6,485,564	5,688,655
Trade and unbilled receivables	8	15,223,634	14,595,624
Other assets, receivables, deposits and prepayments	9	3,293,513	2,942,798
Development properties	10	10,368,989	11,179,609
Loan to joint ventures	$_{11}$	974,837	979,729
Investments in joint ventures	12	807,276	751,246
Property, plant and equipment		25,036	26,931
TOTAL ASSETS		37,178,849	36,164,592
LIABILITIES AND EQUITY Liabilities
Trade and other payables	13	11,060,744	11,201,089
Advances from customers		5,582,147	4,464,589
Retentions payable		856,896	803,836
Interest-bearing loans and borrowings	14	2,256,903	3,258,667
Provision for employees' end-of-service benefits		20,544	21,035
TOTAL LIABILITIES		19,777,234	19,749,216
EQUITY
Equity attributable to owners of the Company
Share capital		4,000,000	4,000,000
Legal reserve		1,179,790	1,179,790
Retained earnings		10,363,393	9,313,015
		15,543,183	14,492,805
Non-controlling interests		1,858,432	1,922,571
TOTAL EQUITY		17,401,615	16,415,376
TOTAL LIABILITIES AND EQUITY		37,178,849	36, 164, 592

INTERIM CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

For the period ended 31 March 2022 (Unaudited)

	Attributable to the owners of the Company ───────────────────────────────────────────────
	Share capital AED'000	Legal reserve AED'000	Retained earnings AED'000	Total AED'000	Non controlling interests AED'000	Total equity AED'000
Balance at 1 January 2022 (Audited)	4,000,000	1,179,790	9,313,015	14,492,805	1,922,571	16,415,376
Profit for the period	-	-	1,050,378	1,050,378	175,861	1,226,239
Total comprehensive income for the period	─────── -	─────── -	─────── 1,050,378	─────── 1,050,378	─────── 175,861	─────── 1,226,239
Dividend declared by a subsidiary	-	-	-	-	(240,000)	(240,000)
Balance at 31 March 2022 (Unaudited)	─────── 4,000,000 ════════	─────── 1,179,790 ════════	─────── 10,363,393 ════════	─────── 15,543,183 ════════	─────── 1,858,432 ════════	─────── 17,401,615 ════════

	Attributable to the owners of the Company ───────────────────────────────────────────────
	Share capital AED'000	Legal reserve AED'000	Retained earnings AED'000	Total AED'000	Non controlling interests AED'000	Total equity AED'000
Balance at 1 January 2021 (Audited)	4,000,000	855,356	6,397,010	11,252,366	2,247,400	13,499,766
Profit for the period	-	-	780,890	780,890	306,673	1,087,563
Total comprehensive income for the period	──────── -	────── -	──────── 780,890	──────── 780,890	──────── 306,673	──────── 1,087,563
Dividend declared by a subsidiary	-	-	-	-	(418,000)	(418,000)
Balance at 31 March 2021 (Unaudited)	──────── 4,000,000 ════════	────── 855,356 ══════	──────── 7,177,900 ════════	──────── 12,033,256 ════════	──────── 2,136,073 ════════	──────── 14,169,329 ════════

INTERIM CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS

For the period ended 31 March 2022 (Unaudited)

			(US\$ 1.00 = AED 3.673)
	Notes	──────────────────── 1 January 2022 to 31 March 2022 AED'000 (Unaudited)	1 January 2021 to 31 March 2021 AED'000 (Unaudited)
CASH FLOWS FROM OPERATING ACTIVITIES
Profit for the period		1,226,239	1,087,563
Adjustments for:
Share of results of joint ventures		(56,028)	(61,450)
Depreciation (including right-of use assets)	5	2,425	4,474
Provision for employees' end-of-service benefits, net Finance costs	6(b)	(491) 71,321	422 54,503
Finance income	6(a)	(40,644)	(7,854)
Cash from operations before working capital changes		────── 1,202,822	─────── 1,077,658
Trade and unbilled receivables		(599,568)	(1,051,390)
Other assets, receivables, deposits and prepayments		(350,715)	(106,939)
Development properties		810,620	535,281
Advances from customers		1,117,558	112,718
Trade and other payables		(167,462)	195,359
Retentions payable		53,060 ──────	(54,376) ───────
Net cash from operating activities		2,066,315 ──────	708,311 ───────
CASH FLOWS FROM INVESTING ACTIVITIES
Finance income received		4,364	3,384
Repayment of loan from/ (loan to) joint ventures		12,730	(6,627)
Amounts incurred on property, plant and equipment		(530) ──────	(1,555) ───────
Net cash from/ (used in) investing activities		16,564 ──────	(4,798) ───────
CASH FLOWS FROM FINANCING ACTIVITIES
Finance costs paid		(43,729)	(59,612)
Borrowings from financial institutions		-	160,000
Repayment of borrowings to financial institutions		(936,627)	(91,824)
Dividend paid to non controlling share holder of a subsidiary		(240,000) ──────	(418,000) ───────
Net cash used in financing activities		(1,220,356) ──────	(409,436) ───────
INCREASE IN CASH AND CASH EQUIVALENTS		862,523	294,077
Cash and cash equivalents at the beginning of the period		5,605,285 ──────	3,307,800 ───────
CASH AND CASH EQUIVALENTS AT THE END OF THE PERIOD	7	6,467,808	3,601,877

═══════ ═══════

NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS At 31 March 2022 (Unaudited)

1 CORPORATE INFORMATION

The incorporation of Emaar Development PJSC (the "Company") as a Public Joint Stock Company was approved by the Securities and Commodities Authority according to Federal Law No.4 of 2000 on 20 November 2017 and the registration certificate was issued on 21 November 2017. The Company's registered office is at P.O. Box 9440, Dubai, United Arab Emirates ("UAE").

The Company is a subsidiary of Emaar Properties PJSC (the "Parent Company" or "Parent"), a company incorporated in the UAE and listed on the Dubai Financial Market. The Company is also listed on the Dubai Financial Market. The Company and its subsidiaries constitute the Group (the "Group").

The principal activities of the Group are property development and development management services in the UAE.

The interim condensed consolidated financial statements were authorised for issue on 13 May 2022.

2.1 BASIS OF PREPARATION

The interim condensed consolidated financial statements of the Group for the period ended 31 March 2022 have been prepared in accordance with International Accounting Standard (IAS) 34: Interim Financial Reporting.

The interim condensed consolidated financial statements do not contain all information and disclosures required for full financial statements prepared in accordance with International Financial Reporting Standards (IFRS) and should be read in conjunction with the Group's annual consolidated financial statements for the year ended 31 December 2021. The same accounting policies, methods of computation, significant accounting judgments and estimates and assumptions are followed in these interim condensed consolidated financial statements as compared with the most recent annual consolidated financial statements, except for the new standards, amendments and significant estimates and judgements adopted during the current period as explained below in notes 2.2 and 2.3.

The interim condensed consolidated financial statements have been prepared in United Arab Emirates Dirhams (AED), which is the Company's functional and presentation currency, and all values are rounded to the nearest thousand except where otherwise indicated. Each entity in the Group determines its own functional currency and items included in the financial statements of each entity are measured using that functional currency.

The interim condensed consolidated financial statements have been prepared on a historical cost basis. Historical cost is generally based on the fair value of the consideration given in exchange for assets.

The preparation of interim condensed consolidated financial statements on the basis described above requires management to make judgements, estimates and assumptions that affect the application of policies and reported amounts of assets and liabilities, income and expenses. The estimates and associated assumptions are based on historical experience and various other factors that are believed to be reasonable under the circumstances, the results of which for the basis of making the judgements about carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates.

Certain comparative amounts have been reclassified to confirm to the presentation used in this interim condensed consolidated financial statements.

On 20 September 2021, the UAE Federal Decree Law No. (32) of 2021 was issued and came into effect on 2 January 2022 which repealed the UAE Federal Law No. (2) of 2015. Companies have (1) one year from 2 January 2022 to comply with the provisions of the UAE Federal Decree Law No. (32) of 2021. The Company's annual general assembly approved in its last meeting held on 20 April 2022 the amendments to its Articles of Association, in order to be fully compliant with the UAE Federal Decree Law No. (32) of 2021, and is in the process of publishing the amendments in the Official Gazette.

Results for the period ended 31 March 2022 are not necessarily indicative of the results that may be expected for the financial year ending 31 December 2022.

Basis of consolidation

The interim condensed consolidated financial statements comprise the financial statements of the Company and the entities controlled by the Company as at 31 March 2022. Control is achieved where all the following criteria are met:

• (a) the Group has power over an entity (i.e., existing rights that give it the current ability to direct the relevant activities of the investee);
• (b) the Group has exposure, or rights, to variable returns from its involvement with the entity; and
• The accompanying notes 1 to 18 form an integral part of these interim condensed consolidated financial statements.

NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS At 31 March 2022 (Unaudited) (continued)

2.1 BASIS OF PREPARATION (continued)

Basis of consolidation (continued)

(C) the Group has the ability to use its power over the entity to affect the amount of the Company's returns.

When the Group has less than a majority of the voting or similar rights of an investee, the Group considers all relevant facts and circumstances in assessing whether it has power over an investee, including:

• The contractual arrangement with the other vote holders of the investee;
• Rights arising from other contractual arrangements; and
• The Group's voting rights and potential voting rights.

The Group re-assesses whether or not it controls an investee if facts and circumstances indicate that there are changes to one or more of the three elements of control. Consolidation of a subsidiary begins when the Group obtains control over the subsidiary and ceases when the Group loses control of the subsidiary. Assets, liabilities, income and expenses of a subsidiary acquired or disposed off during the period are included in the interim condensed consolidated financial statements from the date the Group gains control until the date the Group ceases to control the subsidiary.

Subsidiaries

Subsidiaries are fully consolidated from the date of acquisition or incorporation, being the date on which the Group obtains control (irrespective of percentage of shareholding), and continue to be consolidated until the date when such control ceases. The financial statements of the subsidiaries are prepared for the same reporting period as the Company, using consistent accounting policies. When necessary, adjustments are made to the financial statements of subsidiaries to bring their accounting policies in line with the Group's accounting policies. All intra-group balances, transactions, unrealised gains and losses resulting from intra-group transactions and dividends are eliminated in full.

Non-controlling interest (NCI) are measured initially at their proportionate share of the acquiree's identifiable net assets at the date of acquisition. Changes in the Group's interest in a subsidiary that do not result in a loss of control are accounted for as equity transactions.

Share of comprehensive income/loss within a subsidiary is attributed to the non-controlling interest even if that results in a deficit balance.

A change in the ownership interest of a subsidiary, without a loss of control, is accounted for as an equity transaction. If the Group losses control over a subsidiary, it:

• Derecognises the assets (including goodwill) and liabilities of the subsidiary;
• Derecognises the carrying amount of any non-controlling interest;
• Derecognises the cumulative translation differences, recorded in equity;
• Recognises the fair value of the consideration received;
• Recognises the fair value of any investment retained;
• Recognises any surplus or deficit in the interim condensed consolidated statement of comprehensive income; and
• Reclassifies the Group's share of components previously recognised in other comprehensive income to the interim condensed consolidated statement of comprehensive income or retained earnings, as appropriate.

Details of the Company's subsidiaries are as follows:

Subsidiaries	Place of incorporation	Principal activities	Percentage of effective holding
Dubai Hills Estate LLC	UAE	Property development	50%
Emaar Mina Rashid Development Owned By Emaar Development L.L.C	UAE	Buying, selling and development of real estate and leasing and management of self-owned property	100%
Mina Rashid Properties LLC*	UAE	Buying, selling and development of real estate	100%
Emaar Gardens LLC	UAE	Real Estate Development, Investment in Commercial Enterprises & Management	100%

*Also refer note 16.

NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS At 31 March 2022 (Unaudited) (continued)

2.1 BASIS OF PREPARATION (continued)

Basis of consolidation (continued)

Joint ventures

Joint ventures are those entities over whose activities the Group has joint control, established by contractual agreement and requiring unanimous consent for strategic financial and operating decisions whereby the Group has rights to the net assets of the arrangement, rather than rights to its assets and obligations for its liabilities even if the shareholding is 50% or more.

The Group's investment in joint ventures are accounted for using the equity method of accounting. Under the equity method of accounting, investments in joint ventures are carried in the interim condensed consolidated statement of financial position at cost, plus post-acquisition changes in the Group's share of net assets of the joint venture companies, less any impairment in value.

The interim condensed consolidated statement of comprehensive income reflects the Group's share of results of its joint ventures. Unrealised profits and losses resulting from transactions between the Group and its joint ventures are eliminated to the extent of the Group's interest in the joint ventures. Unrealised losses are eliminated in the same way as unrealised gains, but only to the extent that there is no evidence of impairment.

2.2 SIGNIFICANT ACCOUNTING JUDGMENTS, ESTIMATES AND ASSUMPTIONS

The preparation of these interim condensed consolidated financial statements requires management to make judgments, estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, and the accompanying disclosures and the disclosure of contingent liabilities at the reporting date. Uncertainty about these assumptions and estimates could result in outcomes that require a material adjustment to the carrying amount of the assets or liabilities affected in future periods.

Estimates and their underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimates are revised.

The key judgments and estimates and assumptions that have a significant impact on the interim condensed consolidated financial statements of the Group are discussed below:

Judgments

Timing of satisfaction of performance obligations

The Group is required to assess each of its contracts with customers to determine whether performance obligations are satisfied over time or at a point in time in order to determine the appropriate method of recognising revenue. The Group has assessed that based on the sale and purchase agreements entered into with customers and the provisions of relevant laws and regulations, where contracts are entered into, to provide real estate assets to customers, the Group does not create an asset with an alternative use to the Group and usually has an enforceable right to payment for performance completed to date. In these circumstances, the Group recognises revenue over time. Where this is not the case, revenue is recognised at a point in time.

Determination of transaction prices

The Group is required to determine the transaction price in respect of each of its contracts with customers. In making such judgment, the Group assess the impact of any variable consideration in the contract, due to discounts or penalties, the existence of any significant financing component in the contract and any non-cash consideration in the contract. In determining the impact of variable consideration, the Group uses the "most-likely amount" method in IFRS 15 Revenue from Contracts with Customers whereby the transaction price is determined by reference to the single most likely amount in a range of possible consideration amounts.

Transfer of control in contracts with customers

In cases where the Group determines that performance obligations are satisfied at a point in time, revenue is recognised when control over the asset, that is the subject of the contract, is transferred to the customer. In the case of contracts to sell real estate assets, this is generally when the consideration for the unit has been substantially received and there are no impediments in the handing over of the unit to the customer.

NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS At 31 March 2022 (Unaudited) (continued)

2.2 SIGNIFICANT ACCOUNTING JUDGMENTS, ESTIMATES AND ASSUMPTIONS (continued)

Estimations and assumptions

Consolidation of a subsidiary

The Group has evaluated all the investee entities including special purpose entities to determine whether it controls the investee as per the criteria laid out by IFRS 10: Consolidated Financial Statements. The Group has evaluated, amongst other things, its ownership interest, the contractual arrangements in place and its ability and the extent of its involvement with the relevant activities of the investee entities to determine whether it controls the investee.

Split of real estate components

The interim condensed consolidated financial statements of the Group include certain assets, liabilities, income, expenses and cash flows which are allocated to the Group based on management assumptions and estimates. This mainly includes development properties, trade and other payables, retention payable, advance from customers and selling, general and administrative expenses. These are allocated based on evaluation by project consultant and management's best estimate of use of corporate resources by the Group.

Impairment of trade, unbilled receivables and other receivables

An estimate of the collectible amount of trade, unbilled and other receivables is made when collection of the full amount is no longer probable. For individually significant amounts, this estimation is performed on an individual basis. Amounts which are not individually significant, but which are past due, are assessed collectively and a provision is applied based on expected credit losses on such receivables.

Useful lives of property, plant and equipment

The Group's management determines the estimated useful lives of its property, plant and equipment for calculating depreciation. This estimate is determined after considering the expected usage of the asset or physical wear and tear. The management periodically reviews estimated useful lives and the depreciation method to ensure that the method and period of depreciation are consistent with the expected pattern of economic benefits from these assets.

Measurement of progress when revenue is recognised over time

The Group has elected to apply the input method to measure the progress of performance obligations where revenue is recognised over time. The Group considers that the use of the input method, which requires revenue recognition on the basis of the Group's efforts to the satisfaction of the performance obligation, provides the best reference of revenue actually earned. In applying the input method, the Group estimates the cost to complete the projects in order to determine the amount of revenue to be recognised.

Cost to complete the projects

The Group estimates the cost to complete the projects in order to determine the cost attributable to revenue being recognised. These estimates include the cost of providing infrastructure, potential claims by contractors as evaluated by the project consultant and the cost of meeting other contractual obligations to the customers.

Impairment of non-financial assets

The Group assesses whether there are any indicators of impairment for all non-financial assets at each reporting date. The non-financial assets are tested for impairment when there are indicators that the carrying amounts may not be recoverable. When value in use calculations are undertaken, management estimates the expected future cash flows from the asset or cash-generating a unit and chooses a suitable discount rate in order to calculate the present value of those cash flows.

Development properties are stated at the lower of cost and estimated net realisable value. The cost of work-in-progress comprises construction costs and other related direct costs. Net realisable value is the estimated selling price in the ordinary course of business, less cost of completion and selling expenses.

Fair value measurement of financial instruments

When the fair values of financial assets and financial liabilities recorded in the interim condensed consolidated financial statements cannot be measured based on quoted prices in active markets, their fair value is measured using valuation techniques including the discounted cash flow (DCF) model. The inputs to these models are taken from observable markets where possible, but where this is not feasible, a degree of judgement is required in establishing fair values. Judgements include considerations of inputs such as liquidity risk, credit risk and volatility.

NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS At 31 March 2022 (Unaudited) (continued)

2.2 SIGNIFICANT ACCOUNTING JUDGMENTS, ESTIMATES AND ASSUMPTIONS (continued)

Estimations and assumptions (continued)

Impact of Covid-19

In January 2020, the World Health Organization ("WHO") announced a global health emergency because of coronavirus (the "COVID-19 Outbreak"). During March 2020, the WHO classified COVID-19 Outbreak as a pandemic based on the rapid increase in exposure and infections across the world. The pandemic nature of this virus had resulted in global travel restrictions and lockdown in most countries of the world impacting jurisdictions and segments in which the Group operates.

Compared to 2020 wherein the COVID-19 Outbreak had impacted adversely, during 2021 and in the current reporting period, there has been a significant improvement in operating results of the Group across key segments and geographies of the Group as the impact of pandemic started to ease. Although the global economic situation with relation to COVID-19 remains fluid and will be determined by factors that continue to evolve, such as resurgence of variants, success of support measures introduced by governments and the effectiveness of public policies intended to contain the spread. The Group's management continues to evaluate the situation including pricing strategy and its various cost optimization initiatives.

As per Group's current assessment, the impact of the COVID-19 during the current period on the value of development properties and the ability of these assets to generate income from sale is limited. The Group's assessment considers the level of pandemic related economic impact, actual and expected recovery including occupancy and earning levels of properties. This will be periodically revisited and revised, for any adverse impact.

External valuers report to assess net realizable value of development properties

As at 31 December 2021 valuations performed by certain external valuers continued to state a clause over material valuation uncertainty due to the market disruption caused by the COVID-19 pandemic, which is consistent with the guidance issued by RICS Valuation Global Standards. Consequently, as a result, less certainty and a higher degree of caution should be attached to valuations performed by external valuers. Albeit, this clause does not invalidate the valuation nor does it indicate that the valuation cannot be relied upon, but implies that there is substantially more uncertainty than under normal market conditions. The valuation of properties located in various geographies takes into account the level of pandemic, related economic impact, expected recovery including occupancy and earning levels of properties. As a result of the continued uncertainty, these assumptions may be revised significantly in the subsequent periods.

2.3 CHANGES IN THE ACCOUNTING POLICIES AND DISCLOSURES

(a) New standards, interpretations and amendments in issue and effective

The accounting policies adopted in the preparation of the interim condensed consolidated financial statements are consistent with those followed in the preparation of the Group's annual consolidated financial statements for the year ended 31 December 2021, except for the adoption of new standards and interpretations effective as of 1 January 2022 Although these new standards and amendments apply for the first time in 2022, they do not have a material impact on the interim condensed consolidated financial statements of the Group or the annual consolidated financial statements of the Group. The new standards, interpretations and amendments in issue and effective are mentioned below:

New standards or amendments	Effective date
Onerous Contracts – Cost of Fulfilling a Contract (Amendments to IAS 37)	1 January 2022
Annual Improvements to IFRS Standards 2018–2020	1 January 2022
Property, Plant and Equipment: Proceeds before Intended Use (Amendments to IAS 16)	1 January 2022
Reference to the Conceptual Framework (Amendments to IFRS 3)	1 January 2022

NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS At 31 March 2022 (Unaudited) (continued)

2.3 CHANGES IN THE ACCOUNTING POLICIES AND DISCLOSURES (continued)

(b) Standards, amendments and interpretations in issue but not effective

The new and amended standards and interpretations that are issued, but not yet effective, up to the date of issuance of the Group's interim condensed consolidated financial statements are disclosed below.

New standards or amendments	Effective date
Classification of Liabilities as Current or Noncurrent – Amendments to IAS 1	1 January 2023
IFRS 17 Insurance Contracts	1 January 2023
Disclosure of Accounting Policies – Amendments to IAS 1 and IFRS Practice Statement 2	1 January 2023
Definition of Accounting Estimate – Amendments to IAS 8	1 January 2023
IFRS 10 and IAS 28 - Sale or Contribution of Assets between an investor and its Associate or Joint	Effective date
Venture	deferred
	indefinitely
Amendments to IAS 12 - Deferred Tax related to Assets and Liabilities arising from a Single Transaction	1 January 2023

The Group does not expect the adoption of the above new standards, amendments and interpretations to have a material impact on the future consolidated financial statements of the Group.

2.4 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The same accounting policies, methods of computation, significant accounting judgments and estimates and assumptions are followed in these interim condensed consolidated financial statements as compared with the most recent annual consolidated financial statements for the year ended 31 December 2021, except for the new standards and amendments adopted during the current period as explained in note 2.3.

Revenue recognition

Revenue from contracts with customers

The Group recognises revenue from contracts with customers based on a five-step model as set out in IFRS 15:

• Step 1. Identify the contract(s) with a customer: A contract is defined as an agreement between two or more parties that creates enforceable rights and obligations and sets out the criteria for every contract that must be met.
• Step 2. Identify the performance obligations in the contract: A performance obligation is a promise in a contract with a customer to transfer a good or service to the customer.
• Step 3. Determine the transaction price: The transaction price is the amount of consideration to which the Group expects to be entitled in exchange for transferring promised goods or services to a customer, excluding amounts collected on behalf of third parties.
• Step 4. Allocate the transaction price to the performance obligations in the contract: For a contract that has more than one performance obligation, the Group will allocate the transaction price to each performance obligation in an amount that depicts the amount of consideration to which the Group expects to be entitled in exchange for satisfying each performance obligation.
• Step 5. Recognise revenue when (or as) the entity satisfies a performance obligation.

The Group satisfies a performance obligation and recognises revenue over time, if one of the following criteria is met:

• 1. The customer simultaneously receives and consumes the benefits provided by the Group's performance as the Group performs; or
• 1. The Group's performance creates or enhances an asset that the customer controls as the asset is created or enhanced; or
• 1. The Group's performance does not create an asset with an alternative use to the Group and the entity has an enforceable right to payment for performance completed to date.

For performance obligations where one of the above conditions are not met, revenue is recognised at the point in time at which the performance obligation is satisfied.

NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS At 31 March 2022 (Unaudited) (continued)

2.4 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Revenue recognition (continued)

When the Group satisfies a performance obligation by delivering the promised goods or services, it creates a contract asset based on the amount of consideration earned by the performance. Where the amount of consideration received from a customer exceeds the amount of revenue recognised, this gives rise to a contract liability.

Revenue is measured at the fair value of the consideration received or receivable, taking into account contractually defined terms of payment and excluding taxes and duty. The Group assesses its revenue arrangements against specific criteria to determine if it is acting as principal or agent. The Group has concluded that it is acting as a principal in all of its revenue arrangements. Revenue is recognised in the interim condensed consolidated statement of comprehensive income to the extent that it is probable that the economic benefits will flow to the Group and the revenue and costs, if applicable, can be measured reliably.

Revenue from sale of land

The performance obligation with regards to sale of land is satisfied at a point in time when customer has access to the plot. The Company has established a criteria of having a signed sales agreement and payment of 20% or more to grant access of plot to the customer.

Upon recognition of revenue against a certain plot, the infrastructure cost allocated to the plot of land is released to the statement of comprehensive income, as cost of revenue.

Development services

Revenue from rendering of development management services is recognised when the outcome of the transaction can be estimated reliably, by reference to the stage of completion of the development obligation at the reporting date. Where the outcome cannot be measured reliably, revenue is recognised only to the extent that the expenses incurred are eligible to be recovered.

Interest income

Interest income is recognised as the interest accrues using the effective interest method, under which the rate used exactly discounts estimated future cash receipts through the expected life of the financial asset to the net carrying amount of the financial asset.

Borrowing costs

Borrowing costs directly attributable to the acquisition or construction of qualifying assets, which are assets that necessarily take a substantial period of time to get ready for their intended use or sale, are added to the cost of those assets, until such time as the assets are substantially ready for their intended use or sale. Borrowing costs consist of interest and other costs that an entity incurs in connection with the borrowing of funds.

All other borrowing costs are recognised in the interim condensed consolidated income statement in the year in which they are incurred.

Property, plant and equipment

Property, plant and equipment are measured at cost (which includes capitalised borrowing costs) less accumulated depreciation and any impairment in value. Depreciation is calculated on a straight-line basis over the estimated useful lives as follows:

Sales centers (included in land and buildings)	1 - 10 years
Computers and office equipment	2 - 5 years
Motor vehicles	3 - 5 years
Furniture and fixtures	2 - 5 years

No depreciation is charged on land and capital work-in-progress. The useful lives, depreciation method and residual values are reviewed periodically to ensure that the method and period of depreciation are consistent with the expected pattern of economic benefits from these assets.

NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS At 31 March 2022 (Unaudited) (continued)

2.4 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Property, plant and equipment (continued)

Expenditure incurred to replace a component of an item of property, plant and equipment that is accounted for separately is capitalised and the carrying amount of the component that is replaced is written off. Other subsequent expenditure is capitalised only when it increases future economic benefits of the related item of property, plant and equipment. All other expenditure is recognised in the interim condensed consolidated statement of comprehensive income as the expense is incurred.

Property, plant and equipment are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of property, plant and equipment may not be recoverable. Whenever the carrying amount of property, plant and equipment exceeds their recoverable amount, an impairment loss is recognised in the condensed consolidated statement of comprehensive income. The recoverable amount is the higher of fair value less costs to sell of property, plant and equipment and the value in use. The fair value less costs to sell is the amount obtainable from the sale of property, plant and equipment in an arm's length transaction while value in use is the present value of estimated future cash flows expected to arise from the continuing use of property, plant and equipment and from its disposal at the end of its useful life.

Reversal of impairment losses other than goodwill impairment recognised in the prior years are recorded when there is an indication that the impairment losses recognised for the property, plant and equipment no longer exist or have reduced.

Development properties

Properties acquired, constructed or in the course of construction for sale in the ordinary course of business are classified as development properties and are stated at the lower of cost or net realisable value. Cost includes:

• Freehold and leasehold rights for land;
• Amounts paid to contractors for construction; and
• Planning and design costs, costs of site preparation, professional fees for legal services, property transfer taxes, construction overheads and other directly attributable costs.

Net realisable value is the estimated selling price in the ordinary course of the business, based on market prices at the reporting date and discounted for the time value of money if material, less costs to completion and the estimated costs of sale.

The cost of development properties recognised in the interim condensed consolidated statement of comprehensive income on sale is determined with reference to the specific costs incurred on the property sold and an allocation of any non-specific costs based on the relative size of the property sold.

The management reviews the carrying values of the development properties on an annual basis.

Right-of-use assets

The Group recognises right-of-use assets at the commencement date of the lease (i.e., the date the underlying asset is available for use). Right-of-use assets are measured at cost, less any accumulated depreciation and impairment losses, and adjusted for any remeasurement of lease liabilities. The cost of right-of-use assets includes the amount of lease liabilities recognised, initial direct costs incurred, and lease payments made at or before the commencement date less any lease incentives received. Unless the Group is reasonably certain to obtain ownership of the leased asset at the end of the lease term, the recognised right-of-use assets are depreciated on a straight-line basis over the shorter of its estimated useful life and the lease term. Right-of-use assets are subject to impairment.

Financial assets

All financial assets are recognised and derecognised on trade date when the purchase or sale of a financial asset is made under a contract whose terms require delivery of the financial asset within the timeframe established by the market concerned. Financial assets are initially measured at cost, plus transaction costs, except for those financial assets classified as at fair value through other comprehensive income or profit or loss, which are initially measured at fair value. Trade receivables are initially recognised when they are originated. Trade and unbilled receivables that do not contain a significant financing component or for which the Group has applied the practical expedient are measured at the transaction price determined under IFRS 15. All recognised financial assets are subsequently measured in their entirety at either amortised cost or fair value.

NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS At 31 March 2022 (Unaudited) (continued)

2.4 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Financial assets (continued)

The fair value of financial instruments that are actively traded in organised financial markets is determined by reference to quoted market bid prices for assets and offer prices for liabilities, at the close of business on the reporting date. If quoted market prices are not available, reference can also be made to broker or dealer price quotations.

The fair value of floating rate and overnight deposits with credit institutions is their carrying value. The carrying value is the cost of the deposit and accrued interest. The fair value of fixed interest-bearing deposits is estimated using discounted cash flow techniques. Expected cash flows are discounted at current market rates for similar instruments at the reporting date.

Classification of financial assets

The classification of financial assets at initial recognition depends on the financial asset's contractual cash flow characteristics and the Group's business model for managing them. In order for a financial asset to be classified and measured at amortised cost or fair value through OCI, it needs to give rise to cash flows that are 'solely payments of principal and interest (SPPI)' on the principal amount outstanding. This assessment is referred to as the SPPI test and is performed at an instrument level.

For the purposes of classifying financial assets, an instrument is an 'equity instrument' if it is a non-derivative and meets the definition of 'equity' for the issuer (under IAS 32: Financial Instruments: Presentation) except for certain nonderivative puttable instruments presented as equity by the issuer. All other non-derivative financial assets are 'debt instruments'.

Equity investments

All financial assets that are equity investments are measured at fair value either through other comprehensive income or through profit or loss. This is an irrevocable choice that the Group has made on adoption of IFRS 9 or will make on subsequent acquisition of equity investments unless the equity investments are held for trading, in which case, they must be measured at fair value through profit or loss. Gain or loss on disposal of equity investments is not recycled. Dividend income for all equity investments is recorded through the interim condensed consolidated income statement when the right of payment has been established, except when the Group benefits from such proceeds as a recovery of part of the cost of the financial asset, in which case, such gains are recorded in OCI. Equity instruments designated at fair value through P&L and OCI are not subject to impairment assessment.

The Group elected to classify irrevocably its non-listed equity investments as financial assets measured at fair value through other comprehensive income.

Debt instruments

Debt instruments are also measured at fair value through other comprehensive income (OCI) unless they are classified at amortised cost. They are classified at amortised cost only if:

• the asset is held within a business model whose objective is to hold the asset to collect the contractual cash flows; and
• the contractual terms of the debt instrument give rise, on specified dates, to cash flows that are solely payments of principal and interest on the principal outstanding.

Cash and cash equivalents

For the purpose of the statement of cash flows, cash and cash equivalents consist of cash in hand, bank balances and short-term deposits with an original maturity of three months or less, net of outstanding bank overdrafts.

Trade and unbilled receivables

Trade receivables are stated at original invoice amount (unless there is a significant financing component) less expected credit losses. When a trade receivable is uncollectible, it is written off against provision for doubtful debts. Subsequent recoveries of amounts previously written off are credited to the interim condensed consolidated income statement.

Services rendered but not billed at the reporting date are accrued as per the terms of the agreements as unbilled receivables.

NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS At 31 March 2022 (Unaudited) (continued)

2.4 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Financial assets (continued)

Foreign exchange gains and losses

The fair value of financial assets denominated in a foreign currency is determined in that foreign currency and translated at the spot rate at the end of the reporting period. The foreign exchange component forms part of its fair value gain or loss. For financial assets classified as at fair value through profit or loss, the foreign exchange component is recognised in the interim condensed consolidated statement of comprehensive income.

For financial assets designated at fair value through other comprehensive income any foreign exchange component is recognised in the interim condensed consolidated statement of comprehensive income. For foreign currency denominated debt instruments classified at amortised cost, the foreign exchange gains and losses are determined based on the amortised cost of the asset and are recognised in the 'other gains and losses' line item in the interim condensed consolidated statement of comprehensive income.

Derecognition of financial assets

A financial asset (or, when applicable, a part of a financial asset or part of a group of similar financial assets) is derecognised when:

• The rights to receive cash flows from the asset have expired; or
• The Group retains the right to receive cash flows from the asset, but has assumed an obligation to pay them in full without material delay to a third party under a 'pass-through' arrangement, and
• The Group has transferred its rights to receive cash flows from the asset and either:
• has transferred substantially all the risks and rewards of the asset, or
• has neither transferred nor retained substantially all the risks and rewards of the asset but has transferred control of the asset.

When the Group has transferred its right to receive cash flows from an asset or has entered into a pass-through arrangement, it evaluates if and to what extent it has retained the risks and rewards of ownership. When it has neither transferred nor retained substantially all the risks and rewards of the asset nor transferred control of the asset, the asset is recognised to the extent of the Group's continuing involvement in the asset. Continuing involvement that takes the form of a guarantee over the transferred asset is measured at the lower of the original carrying amount of the asset and the maximum amount of consideration that the Group could be required to repay.

Impairment of financial assets

The Group recognises an allowance for expected credit losses ("ECL") for all debt instruments and contract assets not held at fair value through profit or loss. ECLs are based on the difference between the contractual cash flows due in accordance with the contract and all the cash flows that the Group expects to receive. The shortfall is then discounted at an approximation to the asset's original effective interest rate.

ECLs are recognised in two stages. For credit exposures for which there has not been a significant increase in credit risk since initial recognition, ECLs are provided for credit losses that result from default events that are possible within the next 12-months (a 12-month ECL). For those credit exposures for which there has been a significant increase in credit risk since initial recognition, a loss allowance is required for credit losses expected over the remaining life of the exposure, irrespective of the timing of the default (a lifetime ECL).

When determining whether the credit risk of a financial asset has increased significantly since initial recognition and when estimating ECLs, the Group considers reasonable and supportable information that is relevant and available without undue cost or effort. This includes both quantitative and qualitative information and analysis, based on the Group's historical experience and informed credit assessment, that includes forward-looking information.

For trade and unbilled receivables and other receivables, the Group applies a simplified approach in calculating ECLs based on lifetime expected credit losses. The Group has established a provision matrix that is based on the Group's historical credit loss experience, adjusted for forward-looking factors specific to the debtors and the economic environment. The expected credit losses are recognised in the interim condensed consolidated statement of comprehensive income.

NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS At 31 March 2022 (Unaudited) (continued)

2.4 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Financial assets (continued)

The Group consider a financial asset to be in default when internal or external information indicates that the Group is unlikely to receive the outstanding contractual amounts in full before taking into account any credit enhancements held by the Group. A financial asset is written off when there is no reasonable expectation of recovering the contractual cash flows.

At each reporting date, the Group assesses whether financial assets carried at amortised cost and debt securities at FVOCI are credit impaired. A financial asset is 'credit-impaired' when one or more events that have a detrimental impact on the estimated future cash flows of the financial asset have occurred.

Evidence that a financial asset is credit impaired includes the following observable data:

• –– significant financial difficulty of the debtor;
• –– a breach of contract such as a default or being more than 90 days past due;
• –– the restructuring of a loan or advance by the Group on terms that the Group would not consider otherwise;
• –– it is probable that the debtor will enter bankruptcy or other financial reorganisation; or
• –– the disappearance of an active market for a security because of financial difficulties.

Impairment of non-financial assets

The Group assesses at each reporting date whether there is an indication that a non-financial asset (other than inventories, contract assets and deferred tax assets) may be impaired. If any indication exists, or when annual impairment testing for an asset is required, the Group estimates the asset's recoverable amount. An asset's recoverable amount is the higher of an asset's or cash-generating unit's (CGU) fair value less costs to sell and its value in use and is determined for an individual asset, unless the asset does not generate cash inflows that are largely independent of those from other assets or groups of assets. Where the carrying amount of an asset or CGU exceeds its recoverable amount, the asset is considered impaired and is written down to its recoverable amount. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset or CGU. In determining fair value less costs to sell, an appropriate valuation model is used. These calculations are corroborated by valuation multiples, quoted share prices for publicly traded entities or other available fair value indicators.

Impairment losses are recognised in the interim condensed consolidated statement of comprehensive income in those expense categories consistent with the function of the impaired asset. They are allocated first to reduce the carrying amount of any goodwill allocated to the CGU, and then to reduce the carrying amounts of the other assets in the CGU on a pro rata basis.

For assets excluding goodwill, an assessment is made at each reporting date as to whether there is any indication that previously recognised impairment losses may no longer exist or may have decreased. If such indication exists, the Group estimates the asset's or cash-generating unit's recoverable amount. A previously recognised impairment loss is reversed only if there has been a change in the assumptions used to determine the asset's recoverable amount since the last impairment loss was recognised. The reversal is limited so that the carrying amount of the asset does not exceed its recoverable amount, nor exceed the carrying amount that would have been determined, net of depreciation, had no impairment loss been recognised for the asset in prior years. Such reversal is recognised in the interim condensed consolidated statement of comprehensive income.

Financial liabilities and equity instruments issued by the Group

Debt and equity instruments are classified as either financial liabilities or as equity instruments in accordance with the substance of the contractual agreements. Financial liabilities within the scope of IFRS 9 are classified as financial liabilities at fair value through profit or loss, loans and borrowings, or as derivative instrument as appropriate. The Group determines the classification of its financial liabilities at the initial recognition.

Trade and other payables

Liabilities are recognised for amounts to be paid in the future for goods or services received, whether billed by the supplier or not.

NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS At 31 March 2022 (Unaudited) (continued)

2.4 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Financial liabilities and equity instruments issued by the Group (continued)

Lease liabilities

At the commencement date of the lease, the Group recognises lease liabilities measured at the present value of lease payments to be made over the lease term. The lease payments include fixed payments (including in substance fixed payments) less any lease incentives receivable, variable lease payments that depend on an index or a rate, and amounts expected to be paid under residual value guarantees. The lease payments also include the exercise price of a purchase option reasonably certain to be exercised by the Group and payments of penalties for terminating a lease, if the lease term reflects the Group exercising the option to terminate. The variable lease payments that do not depend on an index or a rate are recognised as expense in the period on which the event or condition that triggers the payment occurs.

In calculating the present value of lease payments, the Group uses the incremental borrowing rate at the lease commencement date if the interest rate implicit in the lease is not readily determinable. After the commencement date, the amount of lease liabilities is increased to reflect the accretion of interest and reduced for the lease payments made.

In addition, the carrying amount of lease liabilities is remeasured if there is a modification, a change in the lease term, a change in the in-substance fixed lease payments or a change in the assessment to purchase the underlying asset.

Loans and borrowings

Term loans are initially recognised at the fair value of the consideration received less directly attributable transaction costs.

After initial recognition, interest-bearing loans and borrowings are subsequently measured at amortised cost using the effective interest rate method. Gains and losses are recognised in the interim condensed consolidated statement of comprehensive income when the liabilities are derecognised as well as through the amortisation process.

Other financial liabilities

Other financial liabilities are initially measured at fair value, net of transaction costs and are subsequently measured at amortised cost using the effective interest method, with interest expense recognised on an effective yield basis.

The effective interest method is a method of calculating the amortised cost of a financial liability and of allocating interest expense over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash payments through the expected life of the financial liability, or, where appropriate, a shorter period.

Derecognition of financial liabilities

The Group derecognises financial liabilities when, and only when, the Group's obligations are discharged, cancelled or they expire. The Group also derecognises a financial liability when its terms are modified, and the cash flows of the modified liability are substantially different, in which case a new financial liability based on the modified terms is recognised at fair value. On derecognition of a financial liability, the difference between the carrying amount extinguished and the consideration paid (including any non-cash assets transferred or liabilities assumed) is recognised in interim condensed consolidated statement of comprehensive income.

Offsetting of financial instruments

Financial assets and financial liabilities are offset, and the net amount is reported in the interim condensed consolidated statement of financial position if there is a currently enforceable legal right to offset the recognised amounts and there is an intention to settle on a net basis, to realise the assets and settle the liabilities simultaneously.

End-of-service benefits

The Group provides end-of-service benefits to its employees. The entitlement to these benefits is usually based upon the employees' final salary and length of service, subject to the completion of a minimum service period. The expected costs of these benefits are accrued over the period of employment.

With respect to its eligible UAE and GCC national employees, the Group makes contributions to a pension fund established by the UAE General Pension and Social Security Authority calculated as a percentage of the employees' salaries. The Group's obligations are limited to these contributions, which are expensed when due.

NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS At 31 March 2022 (Unaudited) (continued)

2.4 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Financial liabilities and equity instruments issued by the Group (continued)

Provisions

Provisions are recognised when the Group has a legal or constructive obligation as a result of a past event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation, and the amount can be reliably estimated. When the Group expects some or all of a provision to be reimbursed, the reimbursement is recognised as a separate asset but only when the reimbursement is virtually certain. The expense relating to any provision is presented in the interim condensed consolidated statement of comprehensive income net of any reimbursement.

Provisions are measured at the present value of the expenditures expected to be required to settle the obligation at the end of the reporting period, using a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the obligation.

Provisions are reviewed at each statement of financial position date and adjusted to reflect the current best estimate. If it is no longer probable that an outflow of resources embodying economic benefits will be required to settle the obligation, the provision is reversed.

Fair value measurement

The Group measures financial instruments, such as investment in securities and hedges, at fair value at each reporting date.

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value measurement is based on the presumption that the transaction to sell the asset or transfer the liability takes place either in the principal market for the asset or liability or the most advantageous market for the asset or liability.

The fair value of an asset or a liability is measured using the assumptions that market participants would use when pricing the asset or liability, assuming that market participants act in their economic best interest.

A fair value measurement of a non-financial asset takes into account a market participant's ability to generate economic benefits by using the asset in its highest and best use or by selling it to another market participant that would use the asset in its highest and best use.

For investments traded in an active market, fair value is determined by reference to quoted market bid prices.

The fair value of interest-bearing items is estimated based on discounted cash flows using interest rates for items with similar terms and risk characteristics.

For unquoted equity investments, fair value is determined by reference to the market value of a similar investment or is based on the expected discounted cash flows.

The fair value of forward foreign exchange contracts is calculated by reference to current forward exchange rates with the same maturity.

Fair value of interest rate swap contract is determined by reference to market value for similar instruments.

The Group uses valuation techniques that are appropriate in the circumstances and for which sufficient data are available to measure fair value, maximising the use of relevant observable inputs and minimising the use of unobservable inputs.

All assets and liabilities for which fair value is measured or disclosed in the interim condensed consolidated financial statements are categorised within the fair value hierarchy, described as follows, based on the lowest level input that is significant to the fair value measurement as a whole:

• Level 1 Fair value measurements are those derived from quoted prices in an active market (that are unadjusted) for identical assets or liabilities.
• Level 2 Fair value measurements are those derived from inputs other than quoted prices included within Level 1 that are observable for the asset or liability either directly (i.e. as prices) or indirectly (i.e. derived from prices).
• Level 3 Fair value measurements are those derived from valuation techniques that include inputs for the asset or liability that are not based on observable market data (unobservable inputs).

NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS At 31 March 2022 (Unaudited) (continued)

2.4 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Fair value measurement (continued)

For assets and liabilities that are recognised in the interim condensed consolidated financial statementson a recurring basis, the Group determines whether transfers have occurred between Levels in the hierarchy by re-assessing categorisation at the end of each reporting period.

For the purpose of fair value disclosures, the Group has determined classes of assets and liabilities on the basis of the nature, characteristics and risks of the asset or liability and the level of the fair value hierarchy as explained above.

3 SEGMENT INFORMATION

For management purposes, the Group is organised into one segment based on its products and services, which is the real estate development business. Accordingly, the Group only has one reportable segment. Management monitors the operating results of the business as a single unit for the purpose of making decisions about resource allocation and performance assessment.

Business segments

Revenue, operating results, assets and liabilities presented in the interim condensed interim condensed consolidated financial statements relates to the real estate development business of the Group.

Geographic segment

The Group is currently operating only in the UAE, hence the operating results, assets and liabilities presented it the interim condensed interim condensed consolidated financial statements relates to its operation in the UAE.

4 REVENUE AND COST OF REVENUE

	Three-month period ended
	31 March	31 March
	2022	2021
	AED'000	AED'000
	(Unaudited)	(Unaudited)
Revenue
Sale of residential units	3,167,290	3,213,455
Sale of commercial units, plots of land and
development services	400,851	634,192
	─────── 3,568,141	─────── 3,847,647
Cost of revenue	═══════	═══════
Cost of residential units	2,009,285	2,182,759
Cost of commercial units and plots of land	42,208	152,273
	─────── 2,051,493	─────── 2,335,032

═══════ ═══════

NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS At 31 March 2022 (Unaudited) (continued)

4 REVENUE AND COST OF REVENUE (continued)

Below is the split of revenue recognised over a period of time and single point in time:

		Three-month period ended
	31 March	31 March
	2022 AED'000	2021 AED'000
	(Unaudited)	(Unaudited)
- Over a period of time - Single point in time	3,415,937 152,204	3,303,759 543,888
	─────── 3,568,141	─────── 3,847,647
	═══════	═══════

5 SELLING, GENERAL AND ADMINISTRATIVE EXPENSES

	Three-month period ended
	31 March	31 March
	2022	2021
	AED'000	AED'000
	(Unaudited)	(Unaudited)
Sales and marketing expenses	152,172	217,685
Payroll and related expenses	31,161	34,799
Property management expenses	14,601	24,583
Depreciation (including right-of use assets)	2,425	4,474
Other expenses	135,413	161,373
	───── 335,772	────── 442,914
	══════	══════

6(a) FINANCE INCOME

	Three-month period ended
	31 March 2022 AED'000 (Unaudited)	31 March 2021 AED'000 (Unaudited)
Finance income on fixed and call deposits with banks Other finance income (i)	4,364 36,280	3,384 4,470
	───── 40,644 ═════	──── 7,854 ════

(i) During the year, the Group has recorded finance income on unwinding of long-term receivable amounting to AED 36,280 thousands (31 March 2021: AED 4,470 thousands).

NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS At 31 March 2022 (Unaudited) (continued)

6(b) FINANCE COST

		Three-month period ended
	31 March 2022 AED'000 (Unaudited)	31 March 2021 AED'000 (Unaudited)
Finance costs - bank and related party borrowings Other finance costs (i)	23,845 47,476 ─────	24,164 30,339 ─────
	71,321 ═════	54,503 ═════

(i) During the year, the Group has recorded finance cost on unwinding of long-term payable amounting to AED 35,242 thousands (31 March 2021: AED 27,229 thousands).

7 BANK BALANCES AND CASH

	31 March	31 December
	2022	2021
	AED'000	AED'000
	(Unaudited)	(Audited)
Cash in hand	984	991
Current and call bank deposit accounts	6,484,580	5,687,664
	─────── 6,485,564	─────── 5,688,655
	════════	═══════

As at 31 March 2022, cash and cash equivalents amounts to AED 6,467,808 thousands (31 December 2021: AED 5,605,285 thousands), net of facilities availed from various commercial banks in the UAE, which are repayable on demand.

Cash at banks earn interest at fixed rates based on prevailing bank deposit rates. Short-term fixed deposits are made for varying periods between one day and three months, depending on the immediate cash requirements of the Group, and earn interest at the respective short-term deposit rates.

As at 31 March 2022, an amount of AED 6,274,933 thousands (31 December 2021: AED 5,624,497 thousands) are with banks against advances received from customers on sale of development properties which are deposited into escrow accounts. These deposits/balances are not under lien.

8 TRADE AND UNBILLED RECEIVABLES

	31 March	31 December
	2022	2021
	AED'000	AED'000
	(Unaudited)	(Audited)
Trade receivables
Amounts receivables within 12 months	667,909	753,848
	───────	───────
Unbilled receivables
Unbilled receivables within 12 months	4,468,434	4,988,216
Unbilled receivables after 12 months	10,087,291	8,853,560
	─────── 14,555,725	─────── 13,841,776
	───────	───────
Total trade and unbilled receivables	15,223,634	14,595,624
	════════	═══════

The above trade receivables are net of AED 48,497 thousands (31 December 2021: AED 48,497 thousands) relating to provision for doubtful debts representing management's best estimate of loss based on expected credit loss model. All other receivables are considered fully recoverable.

NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS At 31 March 2022 (Unaudited) (continued)

9 OTHER ASSETS, RECEIVABLES, DEPOSITS AND PREPAYMENTS

	31 March 2022	31 December 2021
	AED'000	AED'000
	(Unaudited)	(Audited)
Due from related parties (note 17)	1,996,870	1,655,496
Deferred sales commission (i)	836,678	783,683
Advances to contractors and others	338,704	429,017
Value added tax recoverable	82,991	46,069
Prepayments	2,900	3,856
Other receivables and deposits	35,370	24,677
	─────── 3,293,513	──────── 2,942,798
	════════	════════

Other assets, receivables, deposits and prepayments are due within 12 months from the reporting date.

(i) Deferred sales commission expense incurred to obtain or fulfil a contract with the customers is amortised over the period of satisfying performance obligations, where applicable.

10 DEVELOPMENT PROPERTIES

	31 March 2022	31 December 2021
	AED'000 (Unaudited)	AED'000 (Audited)
Balance at the beginning of the period/year	11,179,609	14,469,588
Add: Costs incurred during the period/year Less: Costs transferred to cost of revenue during the period/year	1,240,509 (2,051,129)	6,577,215 (9,867,194)
Balance at the end of the period/year	─────── 10,368,989 ════════	──────── 11,179,609 ════════
11 LOAN TO JOINT VENTURES
	31 March	31 December
	2022	2021
	AED'000 (Unaudited)	AED'000 (Audited)
Emaar Dubai South DWC LLC	835,567	843,493
Old Town Views LLC	139,270	136,236
	─────── 974,837	──────── 979,729
	════════	════════

Loans to joint ventures are unsecured and are repayable as per the terms of the agreement and do not carry any interest.

12 INVESTMENT IN JOINT VENTURES

	31 March	31 December
	2022	2021
	AED'000	AED'000
	(Unaudited)	(Audited)
Emaar Dubai South DWC LLC	320,289	299,270
Zabeel Square LLC	234,538	234,536
Old Town Views LLC	252,449	217,440
Net investment in joint ventures as at period/year end	────── 807,276	─────── 751,246
	═══════	═══════

NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS At 31 March 2022 (Unaudited) (continued)

12 INVESTMENT IN JOINT VENTURES (continued)

The Group has the following effective ownership interest in its joint ventures:

	Country of Incorporation	Ownership
		2022	2021
Emaar Dubai South DWC LLC	UAE	50.00%	50.00%
Zabeel Square LLC	UAE	50.00%	50.00%
Old Town Views LLC	UAE	61.25%	61.25%
13 TRADE AND OTHER PAYABLES
		31 March	31 December
		2022	2021
		AED'000	AED'000
		(Unaudited)	(Audited)
Project contract cost accruals and provisions		3,922,656	4,018,227
Creditors for land purchase		2,944,734	2,916,393
Payable to related parties (note 17)		2,695,216	2,636,728
Trade payables (i)		749,119	798,763
Sales commission payable		221,020	221,003
Payable to authorities		134,627	159,334
Other payables and accruals		393,372	450,641
		─────── 11,060,744	──────── 11,201,089
		════════	════════

(i) Trade payables include Supplier factoring facility of AED 154,471 thousands (31 December 2021: AED 154,471 thousands) under which its suppliers elect to receive early payment of their invoice from a bank by factoring their receivable from the Group. Under the arrangement, a bank agrees to pay amounts to participating supplier in respect of invoices owed by the Group and receives settlement from the Group at a later date.

14 INTEREST-BEARING LOANS AND BORROWINGS

31 March 2022 AED'000 (Unaudited)	31 December 2021 AED'000 (Audited)
3,260,508 17,757 (1,019,998)	3,715,197 683,370 (1,138,059)
2,258,267 (1,364)	────── 3,260,508 (1,841)
2,256,903 ═══════	────── 3,258,667 ═══════
2,167,628 89,275 ──────	3,059,265 199,402 ────── 3,258,667
	────── ────── 2,256,903 ═══════

NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS At 31 March 2022 (Unaudited) (continued)

14 INTEREST-BEARING LOANS AND BORROWINGS (continued)

During 2019, the Group had availed 6-year Revolving credit facility ("RCF facility") of USD 1,000,000 thousands (AED 3,673,000 thousands). This RCF facility is unsecured and carries interest rate at 3 months LIBOR plus 1.25% per annum. This RCF facility carries certain financial covenants. As at 31 March 2022, the Group has drawn down USD 610,000 thousands (AED 2,240,511 thousands) from the RCF facility. This RCF facility is an interest-bearing loan and is presented in the interim condensed consolidated financial statement at AED 2,239,147 thousands (31 December 2021: AED 3,175,297 thousands) net of unamortised directly attributable transaction cost.

During 2021, the Group excuted short term facility of AED 600,000 thousands. This facility carries interest of EIBOR plus 1% per annum and is secured by a corporate guarantee from the Parent Company. As at 31 March 2022, the Group has not drawn down and availed any amount from the facility (31 December 2021: Nil).

As at 31 March 2022, included under interest-bearing loans and borrowings is AED 17,756 thousands (31 December 2021: AED 83,370 thousands) which represents facilities obtained from various commercial banks in the UAE and is repayable on demand.

* Mainly represents payable for RCF facilty which can be extended if required.

15 GUARANTEES AND CONTINGENCIES

The Group has provided a performance guarantee of AED 6,157,185 thousands (31 December 2021: AED 6,351,465 thousands) to the Real Estate Regulatory Authority (RERA), Dubai for its projects as per RERA regulations.

16 COMMITMENTS

At 31 March 2022, the Group had commitments of AED 5,049,482 thousands (31 December 2021: AED 4,384,786 thousands). This represents the value of contracts entered into by the Group including contracts entered into for purchase of plots of land at period/year end, net of invoices received and accruals made at that date.

Furthermore, in accordance with the Development Agreement entered by the Group with Mina Rashid, the Group has a commitment to pay 30% of future profits over the project life cycle of Mina Rashid Project.

There were certain claims submitted by contractors relating to various projects of the Group in the ordinary course of business from which it is anticipated that no material unprovided liabilities will arise.

17 RELATED PARTY DISCLOSURES

For the purpose of these interim condensed consolidated financial statements, parties are considered to be related to the Group, if the Group has the ability, directly or indirectly, to control the party or exercise significant influence over the party in making financial and operating decisions, or vice versa, or where the Group and the party are subject to common control or common significant influence. Related parties may be individuals or other entities.

Related party transactions

During the period, the following were the significant related party transactions, which were carried out in the normal course of business on terms agreed between the parties:

	Three-month period ended ──────────────────
	31 March 2022 AED'000 (Unaudited)	31 March 2021 AED'000 (Unaudited)
Parent:
Revenue (refer (ii) below)	236,788	66,332
Selling, general and administrative expenses (refer (i) below)	112,470	120,848
Finance cost (refer (iii) below)	11,798	10,593
Affiliated entities:	═══════	═══════
Selling, general and administrative expenses	7,782	8,960
Property development expenses	22,421 ═══════	7,390 ═══════
Directors, Key management personnel and their related parties:
Selling, general and administrative expenses	6,040 ═══════	7,821 ═══════

NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS At 31 March 2022 (Unaudited) (continued)

17 RELATED PARTY DISCLOSURES (continued)

Related party balances

Significant related party balances (and the interim condensed consolidated statement of financial position captions within which these are included) are as follows:

	31 March	31 December
	2022	2021
	AED'000	AED'000
	(Unaudited)	(Audited)
Parent:
Other assets, receivables, deposits and prepayments (refer (ii) below)	1,971,660	1,631,162
Trade and other payables (refer (iii) below)	2,642,428	2,598,805
	═══════	═══════
Affiliated entities:
Other assets, receivables, deposits and prepayments	25,210	24,334
Trade and other payables	52,788	37,923
	═══════	═══════

(i) Allocation of corporate expenses:

The Parent Company has provided certain corporate functions to the Group and costs associated with these functions were allocated to the Group. These functions included human resources, treasury, investor relations, finance and accounting, compliance, information technology, corporate and legal compliance, business development and marketing. As per Relationship Agreement, corporate expenses are allocated by the Parent on the basis of 3% of revenue of the Group. During the previous year, the Group and the Parent agreed to settle AED 2,520,438 thousands

payable by the Group to the Parent by offsetting against receivable of AED 4,151,600 thousands from the Parent as at 31 December 2021. This net balance is recoverable on demand.

(ii) Recoverable from the Parent Company:

This mainly represents balances recoverable from the Parent with respect to the development costs incurred for the Build-to-sell (BTS) developments in Dubai Creek Harbour project. As agreed in the Master Transfer Agreement (MTA), the Parent has transferred the development services and profit relating to the BTS development in Dubai Creek Harbour project to the Company, for which the development costs including infrastructure costs are incurred by the Company.

(iii) Payable to the Parent Company:

Amount due to the Parent Company is unsecured and is repayable on demand. This includes AED 2,584,750 thousands (31 December 2021: AED 2,584,750 thousands) which carries interest rate at LIBOR plus 1.4% per annum. Also refer Note 13. The Group has total credit facility of USD 1,350,000 thousands (AED 4,958,550 thousands).

Compensation of key management personnel

The remuneration of key management personnel during the period was as follows:

	31 March 2022	31 March 2021
	AED'000	AED'000
	(Unaudited)	(Unaudited)
Short-term benefits	9,882	11,971
Employees' end-of-service benefits	1,540	478
	───── 11,422	───── 12,449
	══════	═════

During the period, the number of key management personnel is 35 (31 March 2021: 38).

NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS At 31 March 2022 (Unaudited) (continued)

18 FAIR VALUES OF FINANCIAL INSTRUMENTS

Financial instruments comprise financial assets and financial liabilities.

Financial assets of the Group include bank balances and cash, trade and unbilled receivables, loans to joint ventures, other receivables, deposits and due from related parties. Financial liabilities of the Group include interest-bearing loans and borrowings, customer deposits, accounts payable, retentions payable, payable to related parties and other payables.

Fair value of the financial instruments is included at the amounts at which the instruments could be exchanged in a current transaction between willing parties, other than in a forced or liquidation sale.

The fair value of the financial assets and liabilities approximate same as their carrying values, largely due to short term maturities of these instruments.