Talaat Moustafa Group Holding · EGX:TMGH
Talaat Moustafa — Investor Presentation (March 2019)
22 slides from Talaat Moustafa's investor presentation, March 2019
Slide 1: Strategy Presentation March 2019
STRATEGY PRESENTATION MARCH 2019
Slide 2: About TMG Holding
About TMG Holding Talaat Moustafa Group Holding (TMG Holding) a leading conglomerate with special emphasis on developing integrated Market capitalization communities, including but not limited to mixed-use real estate and hospitality projects across Egypt’s key cities. It has an outstanding track-re
Slide 3: FY2018 milestones
FY2018 milestones Achieved record-high sales of EGP21.3bn, the highest in the history of the company and over 50% higher than any other competitor in the market Launch of the New Administrative Capital project Celia which saw stellar performance, with sales reaching EGP12bn in 2018 Sales in just 25
Slide 4: TMG at a glance
TMG at a glance [TMGH.CA/TMGH EY] as at end-2018 MENA’s leading developer(5) c90k+ units delivered 875 operational hotel #1 Egyptian RE developer 86k+ / 5k+ units sold rooms by market cap (since inception, including ministry units) (since inception / 2018 only) Highest cumulative deliveries by a 443
Slide 5: Key financial highlights of FY2018
Key financial highlights of FY2018 Revenue Gross profit Annual improvement in revenue mix with strong 8,000 +17% y-o-y 3,000 +21% y-o-y growth in recurring income achieved in FY2018 2,500 6,000 2,000 EGPmn EGPmn +61% y-o-y +57% y-o-y 4,000 1,500 1,000 17% 2,000 3,432 1,223 500 6,406 2,128 7,495 2,33
Slide 6: We continue to deliver on our key strategic priorities
We continue to deliver on our key strategic priorities previously communicated to the market New sales [EGPbn] Backlog [EGPbn] Achieving robust growth in sales 21.3 30.0 41.7 FY2019 sales target: EGP24bn, up 13% y-o-y 13.1 New upscale launch planned in Madinaty in mid-2019 2017 2018 2017 2018 The Gr
Slide 7: We are on track to achieve all-time high sales
We are on track to achieve all-time high sales Evolution of residential sales across all Evolution of non-residential sales across all Evolution of total sales across all projects projects projects 25.0 20.0 4.0 18.0 3.5 20.0 16.0 3.0 14.0 2.5 15.0 12.0 EGPbn EGPbn EGPbn 10.0 2.0 10.0 8.0 1.5 6.0 1.
Slide 8: Strategic vision allowed for early foothold in rapidly urbanizing East Cairo
Strategic vision allowed for early foothold in rapidly urbanizing East Cairo Population: 30k Population: 1.5mn Population: 4.5mn Expected population: 10mn Investor presentation 8
Slide 9: Case in point: successful launch and sales of Celia
Case in point: successful launch and sales of Celia – a testament to the strength of TMG brand Unmatched brand equity of TMG in the Egyptian Sales status as at end-2018 market 100% 500 feddans 1.03mn sqm Celia is a new mixed-use development located on 500 80% Celia land area Total residential area f
Slide 10: Continue investing in hotel portfolio – significant improvement across all KPIs
Continue investing in hotel portfolio – significant improvement across all KPIs Hospitality segment performance Freed liquidity from monetizing non-core assets and invested EGP1.0bn in ICON in a value accretive 1,800 60% transaction, increasing stake in TMG’s yielding hospitality 1,600 segment to 83
Slide 11: Continue building our recurring income portfolio – hotels
Continue building our recurring income portfolio – target 40-45% of consolidated gross profit Revenue and occupancy rate Hotel rooms evolution 68% 1,800 1,318 58% 346 1,600 1,400 97 1,200 875 EGPmn 1,000 800 +45% y-o-y 600 400 200 1,123 1,625 0 2017 2018 2018 1H2 020 FS Sharm El Sheikh Ext. Jan-2022
Slide 12: Significant improvement across hotel KPIs
Significant improvement across hotel KPIs Four Seasons Nile Plaza KPIs Kempinski Nile Hotel KPIs ARR Occupancy (RHS) Revenue ARR Occupancy (RHS) Revenue 6,000 100% 1,200 2,500 100% 200 76% 81% 5,000 1,000 73% 65% 80% 2,000 63% 80% 150 4,000 54% 800 EGPmn EGPmn 60% 1,500 60% EGP EGP 3,000 600 100 40%
Slide 13: Continue building our recurring income portfolio – retail
Continue building our recurring income portfolio – target 40-45% of consolidated gross profit Retail GLA Retail revenue grows in significance 140 200 120 180 160 100 140 80 88 k sqm 120 EGPmn 60 127.5 100 +26% y-o-y 40 80 60 20 40 40 0 20 Leased GLA Open Air mall opening Total GLA 143 180 (start ope
Slide 14: Continue building our recurring income portfolio – clubs
Continue building our recurring income portfolio – target 40-45% of consolidated gross profit Club revenue grows in significance Club memberships – sold and remaining 450 250 400 350 200 300 k memberships 150 EGPmn 250 152 200 +62% y-o-y 100 197 150 100 50 50 45 263 426 0 0 FY201 7 FY201 8 Sold memb
Slide 15: Maintain robust growth in sales in existing projects
Maintain robust growth in sales in existing projects The Spine(1) Fully integrated residential complex including retail, leisure, hospitality, and offices designed to international standards 2.7mn sqm land area 4.5mn sqm total BuA(2) 13 years of development Downtown 2.3mn sqm of residential BuA Civi
Slide 16: Continue building our recurring income portfolio
Continue building our recurring income portfolio – target 40-45% of consolidated gross profit The Spine(1) 400k sqm of retail portfolio 35:65% / BTS:BTL 635k sqm of office GLA 25:75% / BTS:BTL 600+ hotel keys to be managed by operators Uptown Note (1): Areas subject to change as per the final master
Slide 17: Maintain robust growth in sales in existing projects
Maintain robust growth in sales in existing projects ■ EGP12.5bn of net cash flow from backlog and ■ EGP41.7bn of backlog Historical sales delivered units ■ Avg. gross profit margin 30%-35% ■ Land bank sufficient for the next 17 years ■ 12.5mn sqm ■ Sell all remaining units in Alrehab and Unlaunched
Slide 18: Monetize value of certain assets at the right timing
Monetize value of certain assets at the right timing ■ We believe that today the market does not ascribe value to most of our recurring income portfolio (namely hotels, retail, clubs, and non-residential land bank) which offers a significant long-term upside for equity investors Potential monetizati
Slide 19: Disciplined and selective land acquisition approach
Disciplined and selective land acquisition approach Strategic acquisition criteria Financial acquisition criteria ■ Large plots that allow for the development of urban ■ Preference towards cash acquisitions to manage communities targeting the middle to upper middle financial risk classes ■ Opportuni
Slide 20: Preserving capital appreciation while providing a dividend stream
Preserving capital appreciation while providing a dividend stream Net cash from contracted sales ■ cEGP12.5bn net cash flow pre-tax from backlog sales ■ 12.5 mn sqm (BuA) of BTS residential Net cash from future residential assets to be launched and sold in the Avg. sales price of at least EGP17k/sqm
Slide 21: Share price performance beating the indices since 2H2017
Share price performance beating the indices since 2H2017 TMG Holding share price performance compared to key EGX indices Key facts 15.0 14.0 Listed on EGX since 2007 13.0 12.0 c2,063mn shares outstanding 11.0 EGP 10.0 No foreign ownership limits 9.0 8.0 Shariah observant 7.0 6.0 Reuters/BBG: TMGH.CA
Slide 22: Thank you
Hk =k Thank you TMG Holding
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