Talaat Moustafa Group Holding · EGX:TMGH
Talaat Moustafa — H1 2023 Earnings Presentation
36 slides from Talaat Moustafa's earnings presentation, August 2023
Slide 1: IR Presentation 1H2023 Update
IR PRESENTATION 1H2023 UPDATE TMG Holding S.A.E. .م.م.مجموعة طلعت مصطفى القابضة ش +20 2 3331 2000 Publicly held since 2007 34/36 Mossadek St., Dokki الدقي، شارع مصدق٣٤/٣٦ IR@tmg.com.eg EGX: TMGH.CA / TMGH EY مصر،الجيزة Giza, Egypt www.talaatmoustafa.com
Slide 2: Table of contents
Table of contents Company Overview Hospitality segment About TMG Holding 03 TMG’s hotels 22 Introduction to the business segments 04 Expanding the hospitality portfolio 23 TMG at a glance 06 Financial and operational performance 24 The investment opportunity 07 Key financial highlights 08 Key stock
Slide 3: About TMG Holding
About TMG Holding Talaat Moustafa Group Holding (TMG Holding) a leading conglomerate with special emphasis on developing integrated communities, including but not limited to mixed-use real estate and hospitality projects across Egypt’s Market capitalization (as of August 2023) key cities. It has an
Slide 4: Introduction to the business model and segments
Introduction to the business model and segments Real Estate Hospitality Leasing (Rentals) Sporting clubs Others development Operating Properties: ■ Four Seasons Nile Plaza (Cairo) ■ Four Seasons Sharm El Sheikh ■ Four Seasons San Stefano (Alexandria) Recent projects: ■ Kempinski Nile Hotel Flagship
Slide 5: Financial KPIs
Five main segments delivering stable revenue and contributing immense value to TMG TMG’s business model encompasses five distinct segments, which are driving the company’s value, and which have varying contribution to revenue and gross profit Real Estate Hospitality Leasing (Rentals) Sporting clubs
Slide 6: TMG at a glance
TMG at a glance [TMGH.CA/TMGH EY] as of 1H2023 MENA’s leading developer(1) #1 Egyptian RE developer by backlog(2) #1 Egyptian RE Some 120k units delivered c28mn sqm residual 86 (since inception) 63 77 BuA over 100k / 4.9k units sold developer by market cap 50 51 34 36 41 Highest cumulative deliverie
Slide 7: TMG's business model offers a unique investment opportunity for risk-adverse investors
TMG’s business model offers a unique investment opportunity for risk-adverse investors TMG Holding’s robust business model, experienced management team, as well as its vision and unmatched track record, represents a unique investment opportunity for risk-averse investors, offering exposure to Egypt’
Slide 8: Key financial highlights of 1H2023
Key financial highlights of 1H2023 The successful implementation of management’s long-term vision, grounded on a robust business strategy, is generating continuous improvements in profitability Recurring Recurring income segments 31% 4% 3% and yielded strong financial results during 1H2023 increase
Slide 9: Key stock information and price performance
Key stock information and price performance Key facts TMGH stock price performance compared to EGX30 and EGX RE index ■ Listed on EGX since 2007 16.0 ■ c2,063mn shares outstanding 14.0 ■ No foreign ownership limits ■ Reuters/BBG: TMGH.CA/TMGH EY 12.0 ■ Member of EGX30 index and MSCI Small Cap Egypt
Slide 10: Real Estate Development
REAL ESTATE DEVELOPMENT
Slide 11: Real demand supported by strong population fundamentals
Real demand supported by strong population fundamentals A young population provides fertile ground for incremental supply of real estate 75+ 60-74 Female % A young and rapidly growing population Male % 50-59 ■ Egypt has one of the largest population in the world, with the Greater Cairo Age Group 40-
Slide 12: Strong sales performance across projects and products
Strong sales performance across projects and products New sales by project 1H2023 Impressive real estate sales results in Madinaty, Noor, Celia and Al Rehab cities booked continuously from 2017 are the best testimony of the adequacy of 5% management’s long-term vision and its diligent execution 1% 0
Slide 13: New unique revenue streams originating from the trust granted to our brand
New unique revenue streams originating from the trust granted to our brand Recent bulk sales of prime non-residential and residential properties are the most vital testimony of the strength of our brand and TRUST in our management’s vision, granted to us by the largest local public and private finan
Slide 14: We have full control of the real estate supply in our projects
We have full control of the real estate supply in our projects We provide strategic partners with access to the deep demand for our products through our vast sales network, which opens up an additional source of income Composition of total sales achieved by for the group, at no costs and no risk. TM
Slide 15: Solid value creation achieved through timely deliveries, superb maintenance and infrastructure
Solid value creation achieved through timely deliveries, superb maintenance and infrastructure Value creation – prices for residential units [EGP/sqm] Value creation – prices for non-residential units [EGP/sqm] New sales [EGPbn] 50 250 18.5 Third- parties' Thousands EGP Apartments sales 40 200 Villa
Slide 16: TMG boasts a high-quality, substantial and secure backlog
TMG boasts a high-quality, substantial and secure backlog We have accumulated the largest backlog in Egypt, amounting to EGP102bn, Backlog(1) value by project [EGPbn/%] as a result of the remarkable sales performance lasting since 2017 ■ TMG has built a trusted brand and has accumulated a highly sta
Slide 17: How do we mitigate unforeseen cost increases?
How do we mitigate unforeseen cost increases? Major geopolitical and macroeconomic events are affecting the business environment worldwide, including Egypt, starting with the COVID-19 pandemic, sharp increase in global commodity prices, the devaluation of the EGP and the sharp increase in interest r
Slide 18: Large residual BuA will drive value for the next 20+ years
Large residual BuA will drive value for the next 20+ years Net sales to date Residual BuA by project [mn sqm] by project [mn sqm] Massive residual BuA across all projects, Madinaty 1.2 0.8 sufficient for 20+ years of development 0.9 0.8 1.2 Rehab ■ We estimate TMG’s residual programmed built-up area
Slide 19: TMG's land footprint spreads over 74mn sqm, the largest in the country
TMG’s land footprint spreads over 74mn sqm, the largest in the country On the back of a 50 years-long history, TMG accumulated Our decade-long land purchase contracts with the one of the largest land footprint in the region and the largest Ministry of Housing are also a solid testimony to the trust
Slide 20: Noor launch – unprecedented success in the history of the Group
Noor launch – unprecedented success in the history of the Group and Egyptian real estate market Noor sales reached a record EGP15bn in just three weeks during the June launch, achieving the highest sales in a launch for a real estate developer in Egypt ■ We launched our new integrated city in front
Slide 21: Hospitality Segment
EERE = Ee z NSS SS0SSs SSS SSS 555551 5, i HOSPITALITY SEGMENT
Slide 22: TMG's hotels portfolio
TMG’s hotels portfolio TMG is positioned as a leader in the luxury and ultra-luxury tourism industry in Egypt ■ We boasts a portfolio of outstanding and geographically diverse hospitality properties in Egypt, which allow us to attract a more various customer mix, composed primarily by international
Slide 23: Continuing to develop our hospitality portfolio
Continuing to develop our hospitality portfolio TMG continue to expand its hospitality portfolio, on the back of over 20 years of expertise in the sector, with a compelling long-term growth plan and long-lasting successful partnerships with top management companies ■ The Four Seasons Hotel and Priva
Slide 24: TMG's hotels portfolio
TMG’s hotels portfolio In FY2022 revenues and EBITDA of the hospitality division delivered EBITDA and occupancy performance [FY2022] the best performance on record since 2018. The strong performance 1,400 was confirmed in 1H2023. 71% 1,150 67% ■ All four properties delivered strong operational and f
Slide 25: Strong performance in FY2022
Strong performance in FY2022 EBITDA per property FY2022 EBITDA FY2022 - Consolidated EGP ARRs per property – FY2022 EGP ARR FY2022 - Consolidated 12,000 10,985 8,000 700 1,400 599 6,866 1,175 600 1,200 9,000 500 7,844 6,000 7,520 1,000 400 349 4,670 5,844 800 EGP 6,000 5,384 EGPmn 4,057 EGPmn 5,121
Slide 26: Strong performance in 1H2023
Strong performance in 1H2023 EBITDA per property 1H2023 EBITDA 1H2023 - Consolidated EGP ARRs per property – 1H2023 EGP ARR 1H2023 - Consolidated 18,000 12,000 525 477 1,000 911 10,533 900 14,569 450 15,000 382 800 12,362 8,824 375 691 11,443 9,000 700 12,000 268 9,516 300 267 600 EGP 9,000 8,121 EG
Slide 27: Commercial Leasing
COMMERCIAL LEASING
Slide 28: Key aspects of TMG's commercial spaces management strategy
Key aspects of TMG’s commercial spaces management strategy We have expanded supply of commercial spaces consistently with the increase in the population in our areas of interest 118k sqm total GLA Prime properties across TMG’s projects ■ TMG has developed some c400k square meters of prime retail BuA
Slide 29: Strong growth in the retail performance during 1H2023
Strong growth in the retail performance during 1H2023 on the back of the new operational space and existing rents continuously improve Retail revenues 450 +60% 399 Retail operations are continuously growing on the back of new commercial 375 y-o-y 315 areas becoming available for lease 300 249 ■ Reve
Slide 30: Continuing to develop our recurring income portfolio: the Spine
Continuing to develop our recurring income portfolio: the Spine 2+MN sqm land area 3.7MN sqm total BuA Project comprehensive of high quality residential and non-residential, amenities and green open-spaces The Spine is a fully integrated project in the heart of Madinaty. It will provide the city wit
Slide 31: Continuing to develop our recurring income portfolio: the Spine
Continuing to develop our recurring income portfolio: the Spine The Spine is planned to be a destination hub, similarly to the point of attractions in the most developed cities globally ■ The master plan of the Spine encompasses an easily accessible, integrated, high quality mix of residential, offi
Slide 32: Clubs Segment
CLUBS SEGMENT
Slide 33: TMG Clubs: a fast growing and profitable segment with little cash commitment
TMG Clubs: a fast growing and profitable segment with little cash commitment Club revenues Clubs’ operations growing y-o-y, confirming the great 450 interest on the property from the population. ■ Club revenues in 1H2023 grew 13% y-o-y, reaching EGP364mn, compared to club revenues in 1H2022 of EGP32
Slide 34: Corporate Responsibility & Sustainability
CORPORATE RESPONSIBILITY & SUSTAINABILITY
Slide 35: Focused on corporate responsibility
Focused on corporate responsibility BUILDING SUSTAINABLE ENABLING ECONOMIC FOCUSED ON SOCIAL IMPACT ■ Shariah compliant – no exposure to alcohol sales or COMMUNITIES GROWTH gambling. ■ Building sustainable communities focused on improving As the leading developer in Egypt, TMG is at the forefront li
Slide 36: Thank you
{| TMG Thank you
Talaat Moustafa Group Holding — H1 2023 Earnings Presentation on 6ix