Q1 2018 Results 6 April 2018 1
Agenda Q1 2018 Key Highlights & Destination Progress Page 3 Q1 2018 Financials and KPIs Highlights Page 7 Q1 2018 Financials and KPIs Appendix Page 13 2
Key Highlights Q1 2018 Turnaround Strategy Bearing Its Fruits with Significant Increase on the Operational and Financial Level across all Segments. Revenues grew by 41.1% to CHF 74.1 million, Adjusted EBITDA Increased By 206.3% to CHF 14.7 Million And Losses Significantly Reduced By 59.2% To Reach Only CHF 5.1 Million. ➢ Net real estate sales increased 2.5 times to CHF 39.8 million in Q1 2018. ➢ Hotels revenues increased by 30.5% to CHF 40.2 million and Gross Operating Profits (GOP) increased by 52.6% to CHF 17.7 million vs. CHF 11.6 million. ➢ Town Management revenues increased by 29.8% to CHF 7.4 million. ➢ Adjusted EBITDA significantly increased by 206.3% to reach CHF 14.7 million. ➢ Net losses were tremendously reduced by 59.2% to reach CHF 5.1 million in Q1 2018 vs. CHF 12.5 million in Q1 2017. ➢ Orascom Development Egypt (ODE) entered into a partnership with the Egyptian Government to develop 1,000 feddan in West Cairo, marking our first foray into the first home market in Egypt. ➢ Successfully sold Citadel Azur Hotel and signed the sale of 3 hotels in Makadi, Red Sea, Egypt both for a total EV of CHF 98.5 million. ➢ ODE signed a contract for the sale of its stake in Tamweel Group at a total equity valuation of c. CHF 20.0 million. ➢ Sold 8.2% stake of ODE to a set of strategic investors for a total of c. CHF 33.2 million, reducing our stake to 76.59%. ➢ Finalizing all documentation for the sale 3 hotels in Makadi for EV of CHF 49.0 million and working diligently on our plan with the banks to reduce our debt by c. CHF 56.0 million in 2018. ➢ ODE Distributed a cash dividend of EGP 0.20 per share post the split on June 4, 2018. 3
Destinations Progress during Q1 2018 El Gouna, Egypt: ▪ Net sales more than doubled to reach CHF 21.3 million in Q1 2018. ▪ In January 2018, we launched Tawila phase III with a total inventory of USD 44.1 million. Phase III includes town houses and apartments and sold USD 16.0 million to date. ▪ In April 2018, we launched a new real estate project called “Ancient Sands Villas” with a total inventory of USD 80.0 million. The launched phase inventory was USD 22.7 million & consists of twin houses & villas. ▪ Hotels GOP increased by 70.7% to reach CHF 7.0 million vs. CHF 4.1 million in Q1 2017. ▪ Continuing with the renovation works across some of our hotels with plans to be finalized during 2018. ▪ Hosted the FIFA World Cup Trophy Tour in March and hosted El Gouna International Open Squash Championship for men & women along with El Gouna Polo 2018 event in April. ▪ Looking into adding more hotel rooms and possibly a new hotel in 2018/2019 Makadi Heights, Egypt: ▪ We started an aggressive sales and marketing campaign to revive Makadi destination. We launched a new project in April 2018 with a total inventory of CHF 11.1 million to date we managed to sell and reserve more than CHF 5.5 million. ▪ Opened Makadi Heights club house during Q1 2018. ▪ On track with finalizing all necessary documentation for the sale of 3 hotels in Makadi for a total EV of CHF 49.0 million with cash proceeds of CHF 27.4 million and the deconsolidation of CHF 14.4 million of debt ▪ Sold Citadel Azur hotel in Sahl Hashish for an EV of CHF 49.5 million. This sale resulted in cash proceeds of c. CHF 31.7 million and the deconsolidation of c. CHF 17.8 million of debt. 4
Destinations Progress during Q1 2018 Hawana Salalah, Oman: ▪ Net sales increased by 100% to CHF 6.2 million in Q1 2018. ▪ Hotels revenues increased by 26.0% to CHF 13.1 million in Q1 2018. ▪ Hotels occupancy reached 97% in Q1 18 and GOP increased by 46.3% to CHF 6.0 million vs. CHF 4.1 million in Q1 2017. ▪ Started the construction works for 176 new rooms in Al Fanar Hotel, capitalizing on the huge demand, to be finalized this year. Jebal Sifah, Oman: ▪ Net sales increased by 55.5% to CHF 8.4 million in Q1 2018 on the back of the great success of phase 2 of the Golf Lake Residence launched in Nov. 2017 with a total inventory of CHF 18.0 million. ▪ Additional pontoons will be installed at the Marina along with an enhanced water taxi service scheduled to launch in 2018. ▪ Jebal Sifah is set to welcome a new bar, restaurant, supermarket and a fishing charter business. Lustica Bay, Montenegro: ▪ Net sales increased by 100% to CHF 3.9 million in Q1 2018. ▪ Finalizing the 5-star Chedi Hotel (110 rooms) construction & holding its soft opening in July 2018. ▪ Opened the new access road to the marina village and launching the Marina and over 1,000 sqm of marina retail in summer 2018. ▪ Progressing with construction of “E” and “B” building clusters comprising 68 apartments due for delivery in 2018 and early 2019. The Cove, UAE: ▪ Hotels revenues increased by 19.1% to reach CHF 8.1 million in Q1 2018. ▪ Hotels GOP increased by 28.6% to reach CHF 3.6 million vs. CHF 2.8 million in Q1 2017. 5
Agenda Q1 2018 Key Highlights & Destination Progress Page 3 Q1 2018 Financials and KPIs Highlights Page 7 Q1 2018 Financials and KPIs Appendix Page 13 6
Business Segments Q1 2018 Adj. EBITDA 1 Revenue EBITDA (CHF mn) Q1 2018 Q1 2017 Δ in % Q1 2018 Q1 2017 Q1 2018 Q1 2017 Hotels 2 40.2 30.8 30.5% 15.9 14.9 15.4 9.3 Real Estate 22.3 12.3 81.3% 5.9 1.7 5.8 1.4 Land - - - - - - - Town Management 3 7.4 5.7 29.8% (2.1) (1.2) (2.0) (1.2) Tamweel Group 4.2 3.7 13.5% 1.0 1.0 1.0 1.1 Corporate & Unallocated Items - - - (9.1) (14.0) (5.5) (5.8) ODH Group 74.1 52.5 41.1% 11.6 2.4 14.7 4.8 1 Adjusted EBITDA: EBITDA adjusted for non cash items (which includes provisions & impairments, other gains and losses, FX gains & share in associates) 2 Q1 2017 figures includes gains in relation to settlement of borrowings in the amount of CHF 6.4mn. 3 Town Management includes revenues from Utilities & services, Hospital, Marina, Golf, Rentals, Educational services, Limousine, & other town amenities. Revenues increased but EBITDA and Adj. EBITDA losses widened, due to the commencement of operations in Oman and Montenegro. This is usually the case at first until the appropriate volumes and economies of scale are reached then it turns around positively. 7
Real Estate KPIs Q1 2018 Net value of contracted Number of contracted Average selling price (CHF/m 2 ) units (CHF mn) units Country Destination Q1 18 Q1 17 Q1 18 Q1 17 Q1 18 Q1 17 Egypt El Gouna 21.28 10.06 37 37 2,355 1,594 Fayoum - 0.37 - 7 - 567 Makadi 0.02 0.02 1 1 272 281 Oman Jebel Sifah 8.39 5.45 56 31 1,809 1,852 Salalah Beach 6.19 - 52 - 1,598 - Montenegro Luštica Bay 3.90 - 7 - 5,998 - ODH Group 39.77 15.90 153 76 2,176 1,577 8
Deferred Revenue Recognition Schedule* (CHF mn) Deferred Revenue Country Destination 2018 2019 2020 2021 Balance El Gouna 75.26 34.56 40.70 - - Egypt Fayoum 1.58 0.32 0.83 0.33 0.10 Makadi - - - - - Total Egypt 76.84 34.88 41.53 0.33 Jebel Sifah 26.32 15.45 6.93 3.94 - Oman Salalah Beach 23.06 8.98 13.47 0.61 - Total Oman 49.38 24.43 20.40 4.55 - Luštica Bay 19.72 19.16 0.56 - - Montenegro 145.94 78.47 62.49 4.88 0.10 ODH Group * It is also important to note in addition to the outstanding deferred revenue balance; the Group also has a deferred interest income CHF 10.2 million. * Figures are rounded to the nearest decimal point. 9
Hotel KPIs Q1 2018 Occupancy for Total number of Number of TRevPAR* GOP PAR** available rooms hotel rooms available rooms (CHF) (CHF) (%) Destination Q1 18 Q1 17 Q1 18 Q1 17 Q1 18 Q1 17 Q1 18 Q1 17 Q1 18 Q1 17 El Gouna 1 2,655 2,645 2,655 2,645 78 71 57 40 29 17 Taba Heights 2 2,365 2,365 1,260 818 17 23 7 7 (3) (4) Citadel Azur 514 514 514 514 70 47 48 30 25 13 Fayoum 53 50 53 50 27 55 28 24 4 (1) Floating Hotel 27 27 27 27 25 26 164 109 81 47 Total Oman 3 971 851 971 851 94 92 158 146 71 55 UAE 4 471 346 471 346 79 89 189 218 83 91 Makadi 5 1,113 1,113 - - ODH Group 8,169 7,911 5,951 5,251 1. In FY 17 we transferred 87 hotel rooms of Fanadir and Bellevue into real estate products and in Q3 2017 Ancient Sands hotel room increased by 97 rooms 2. During FY 2017, only 4 hotels were operating (Sofitel with 442 rooms, Strand Beach Hotel with 503 rooms, El Wekala Hotel with 215 rooms and 100 rooms in Bay View Hotel out of 394 existing rooms). Whereby, only 2 hotels were operating representing 718 rooms in FY 2016. In December 23 nd , 2017, Al Fanar Hotel extension was opened with 98 rooms, thus brining total number of the hotel rooms to 400 rooms and also 22 new rooms were added to Rotana Hotel, 3. thus bringing total number of rooms to 422 room. 4. In June 2017, we opened 145 new rooms in the Cove Hotel, and transferred 20 rooms into real estate units thus brining total number of the hotel rooms to 471 rooms. 5. Our 3 hotels in Makadi were rented to FTI Group since Jan. 2017. * Financial KPIs are calculated based on the number of available rooms during the reported period of Q1 2018. ** Includes all expenses of the hotels in the destinations. 10
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