STRATEGY PRESENTATION JANUARY 2019
Disclaimer Certain information disclosed in this presentation consists of forward looking statements reflecting the current view of the company with respect to future events, and are subject to certain risks, uncertainties and assumptions. Many factors could cause the actual results, performance or achievements of the company to be materially different from any future results, performance or achievements that may be expressed or implied by such forward looking statements, including worldwide account of trends, economic and political climate of Egypt, the Middle East, and changes in business strategy and various other factors. Should one or more of these risks or uncertainties materialize or should underlying assumptions prove incorrect, actual results may vary materially from those described in such forward looking statements. Investor presentation 2
TMG at a glance [TMGH.CA/TMGH EY] as at end-2018 MENA’s leading developer (5) 875 operational hotel c90k+ units delivered #1 Egyptian RE developer 86k+ / 5k units sold rooms by market cap (since inception, including ministry units) (since inception / 2018 only) 443 rooms under Highest cumulative deliveries by a 30+ years track record single MENA developer development (1) Remaining collections [EGPbn] (6) New sales [EGPbn] Backlog [EGPbn] (6) 127.5k sqm GLA 41.6 31.2 +39% +46% +62% portfolio (2) 30.0 21.3 21.3 y-o-y y-o-y 13.1 y-o-y 40k sqm GLA leased 2017 2018 2017 2018 2017 2018 Expected net cash flow from backlog Net cash position [EGPbn] 197k club membership c16mn sqm and delivered units [EGPbn] (6) capacity (3) remaining BuA 3.04 +39% +95% 12.5 9.0 y-o-y y-o-y 1.03 c3.5mn BuA commercial Sold c45k memberships, c152k BTS and BTL memberships yet to be sold 2017 2018 9M2017 9M2018 Egypt’s leading developer of premium master planned communities with sufficient land bank for 17 Years and Sizeable Portfolio of Recurring Income Assets contributed 25% of GOP for 2017 (4) and planned to increase to 40-45% Note (1): Includes Four Seasons Sharm El Sheikh extension (under construction) and Four Seasons Madinaty (in design phase) Note (2): Includes Open Air mall (plan to open in 2019, Carrefour operating since October 2018, achieving the highest Carrefour sales per sqm in Egypt) Note (3): Substantial high-margin revenue stream with limited CapEx needs overlooked by the market, to deliver exponential growth mimicking accelerated population build-up. Capacity does not include Celia club which is under process of licensing. Note (4): Contributed 29% in 9M2018. Investor presentation 3 Note (5): By number of units delivered. Note (6): Preliminary figure
We continue to deliver on our key strategic priorities previously communicated to the market New sales [EGPbn] Backlog [EGPbn] 41.6 30.0 21.3 Achieving robust growth in sales 13.1 2017 2018 2017 2018 � The Group invested EGP1bn to Hospitality EBITDA [EGPmn] increase its stake in ICON to 83.3% Continue building our recurring income portfolio – 42.9% � Signed JLL to manage and operate 38.1% Open Air Mall in Madinaty - target 40-45% of Gross Profit by 2020, up from 25% in 2017 � Signed Carrefour as anchor tenant in 428 696 Rehab & Madinaty malls, opened in 2017 2018 Open Air mall in October 2018 EGP1bn proceeds from the Executing the Group’s strategy of monetizing non-core assets transaction Disciplined approach for land acquisitions while managing Strategic EGP12.0bn sales financial risk land in 2018 Mission: Provide exceptional services to all our Preserving capital appreciation while providing a dividend clients and ensure great customer experience and stream capitalize on such client base for new projects Investor presentation 4
Strategic vision allowed for early foothold in rapidly urbanizing East Cairo Population: 30k Population: 1.5mn Population: 4.5mn Expected population: 10mn Investor presentation 5
■ ■ ■ ■ ■ Case in point: successful launch of Celia – a testament to the strength of TMG brand Major corporate revamp since July 2017 - Sales status end-2018 unmatched brand equity of TMG in the Egyptian 500 feddans 1.03mn sqm 100% market Celia land area Total residential area 80% 3,778 658 Celia is a new mixed-use development located on 500 60% feddans in the New Administrative Capital (NAC) – largest 3,125 units (c41%) cEGP12.0bn land plot launched in NAC to date 40% Units sold until Total net sales since launch 20% 2,718 Total residential BuA of c1.03mn sqm, in addition to 148k sqm 407 end-2018 until end-2018 of non-residential space 0% Apartments Villas Launched in June 2018, to be completed within the next 5 – 7 7,561 units years Units sold Units unsold Total residential units for ■ Very good market reception as a testimony to brand sale equity ■ Significant pent-up demand in location despite earlier BuA breakdown by type Units breakdown by type launches by smaller companies before the launch of Celia ■ Good outlook on demand dynamics following launch 13% 14% ■ More than 16% of clients are returning clients 22% Well-diversified offering portfolio: ■ Four types of multitenant buildings, 8 floors each ■ Five types of stand-alone units ranging from 213 to 373 86% 65% sqm per unit ■ Master plan accommodates for a sporting club and basic services Villas Apartments Services Villas Apartments Land purchased in 2017 for EGP2,100/sqm, payable over 9 years (10% down payment, 2 years grace period + 7 years installments, interest of 10% only) Investor presentation 6
We are on track to achieve all-time high sales ■ We are benefiting from constant population build-up in our projects, allowing us to monetize our recurring income assets which has a positive impact on our gross profit. EGPbn Evolution of total presales across our projects 25.0 13.9 0.7 3.1 2.0 3.5 5.9 5.9 6.1 6.6 13.1 21.3 20.0 2.9 % 2 6 + 15.0 3.6 10.0 0.7 0.2 0.4 0.6 5.0 0.8 0.1 0.1 13.9 18.3 3.1 1.9 2.7 5.5 5.7 5.5 5.9 9.5 0.0 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 Residential Non-residential Total presales Investor presentation 7
Exceptional Performance in 2H2017 and 2018 outperforming all peers – demand / supply gap in market still exists Sales of other market players (1) [EGPbn] Units delivered in 2017 (1) Annual supply by Tier 1 listed developers still well below our 12.0 9.8 9.1 8.6 estimates of market demand 1,386 (2) by mid-to-high income household segment of at 2015 2016 2017 9M2018 least 50k units per annum Total 4,854 units delivered 10.5 9.8 8.5 6.3 1,781 (2) 2015 2016 2017 9M2018 TMG delivered over 5.9 5.9 c 5,100 units 4.6 3.8 1,151 (2) in 2017 alone (3) 2015 2016 2017 9M2018 (in addition to c1,300 5.1 3.8 ministry units) 3.4 536 0.9 2015 2016 2017 9M2018 Investor presentation 8 Note (1): Source: Companies and sell-side reports; Note (2): Includes second home-deliveries; Note (3): TMG recognizes its revenues on delivery rather than % of completion making it the largest player within Egypt’s listed universe in terms of income statement numbers
■ ■ ■ Continue investing in hotel portfolio – significant improvement across all KPIs Four Seasons Sharm El Sheikh Four Seasons Nile Plaza, Cairo Hospitality segment performance [200 keys, opened 2001] [366 keys, opened 2004] 1,800 60% 1,600 50% 1,400 1,200 40% EGPmn 1,000 30% 800 600 20% 400 10% 200 1,123 1,625 608 322 261 356 421 145 113 378 105 551 221 182 702 308 266 748 320 382 509 422 817 696 95 68 79 0 0% 2010 2011 2012 2013 2014 2015 2016 2017 2018 Revenue GOP EBITDA GOP margin (RHS) EBITDA margin (RHS) Four Seasons San Stafano, Alexandria Kempinski Nile Hotel, Cairo Freed liquidity from monetizing non-core assets and [118 keys, opened 2007] [191 keys, opened 2010] invested EGP1.0bn in ICON in a value accretive transaction, increasing stake in TMG’s yielding hospitality segment to 83.3% 443 new keys under development: ■ 346 keys in FS Madinaty + 121 residential units, construction breaking ground in 2018, to be completed in 2021 ■ 97 keys in FS Sharm El Sheikh ext. + 69 residential units; under construction, to be completed in 2020 Ongoing phased renovation of FS Nile Plaza Investor presentation 9
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