Palm Hills Development Co. · EGX:PHDC
Palm Hills Development — Palm Hills Developments — Investor Presentation (June 2018)
43 slides from Palm Hills Development's investor presentation, June 2018
Slide 1: Investor Presentation June 2018
Palm Hills Developments | January 2015 Investor Presentation June 2018
Slide 2: The Market
1 Village Gate, East Cairo The Market Palm Hills Katameya, East Cairo
Slide 3: Egypt has the Largest & Fastest Growing Population in MENA Region
THE MARKET Egypt has the Largest & Fastest Growing Population in MENA Region Population Density Egypt’s Population Growth (millions) Cairo’s Population Growth (millions) 103.0 18.8 19.5 91.5 93.4 16.9 82.1 15.2 74.9 62.4 11.9 49.4 8.3 38.6 6.5 30.8 23.6 4.7 3.0 1955 1965 1975 1985 1995 2005 2010 201
Slide 4: PHD is Capitalizing on Egypt's Unique Dynamics, Population Growth & Urbanization Trends
THE MARKET PHD is Capitalizing on Egypt’s Unique Dynamics, Population Growth & Urbanization Trends Housing Units Supply 2010-2016 (thousands) Housing Units Supply 2016 (thousands) 352 164 Key Takeaways 264 Total Housing Units: 264K • Demand is estimated in the Upper 196 184 177 Middle to High End ma
Slide 5: PHD in brief
2 Perspective of Palm Hills New Cairo, East Cairo PHD in brief Hacienda Bay, North Coast
Slide 6: Who's PHD?
PHD IN BRIEF Who’s PHD? ✓ High quality off-plan developer with good track Management Team Shareholding Structure1 record and more than 20 years of experience 1% 1% Yasseen Mansour 9% Strategic Chairman & Group Holders ✓ Cumulative sales of more than EGP34.1 bn since CEO 58% Institutions 1997 Tarek A
Slide 7: High Quality Off-plan Developer with more than 20 years of Experience
PHD IN BRIEF High Quality Off-plan Developer with more than 20 years of Experience PHD inks co- Corporate Milestones PHD concludes EGP1.65 PHD inks co- development bn rights issue to finance development agreements with NUCA new growth endeavors agreements with Private of 3,000 feddan in Al Ethadia R
Slide 8: PHD's Competitive Advantage is based on Focus on High Quality
PHD IN BRIEF PHD’s Competitive Advantage is based on Focus on High Quality Quality Focused PHD’s strategy is focused on offering the highest quality livable gated communities in Egypt, catering to the middle, upper middle and high end spectrum. Quality starts with the master plan, architecture, qual
Slide 9: Well Diversified & Balanced Portfolio of Projects
PHD IN BRIEF Well Diversified & Balanced Portfolio of Projects First Homes Secondary Homes Commercial 5 6 1 2 4 3 ▪ Offering first homes in 24 ▪ Offering secondary homes by the ▪ PHD owns almost 2.5 mn sqm of projects in West and East Cairo Mediterranean sea in 4 projects land allocated for commerci
Slide 10: The Largest Land Bank in Egypt of 41 mn sqm
PHD IN BRIEF The Largest Land Bank in Egypt of 41 mn sqm Completed Projects Projects to be Launched Developed Area Under Residential Developed Area Under Land Area (000 Residential Land Commercial Area Land Area Commercial Area Project Name Residential Area Development Project Name Land Area (000 Re
Slide 11: Residential Real Estate - Projects Summary
PHD IN BRIEF Residential Real Estate - Projects Summary Projects Completed Projects Under New Badya Portfolio Projects Development Projects Number of Projects 29 13 10 5 1 Bamboo Extension, West Cairo Delivered Units 8,433 4,879 3,554 - - Av. For Sale Inventory1 (EGP bn) 509 0.08 8.7 54.1 449 Av. Fo
Slide 12: Commercial Real Estate… Monetization of Non-Core Assets Underway
PHD IN BRIEF Commercial Real Estate1… Monetization of Non-Core Assets Underway Palm Central, West Cairo Village Gate, East Cairo Land Size 12k sqm Land Size 16k sqm Sellable Area 4.5k sqm Sellable Area 10.5k sqm Targeted Sales EGP170 mn Targeted Sales EGP220 mn Cumulative New Sales EGP161 mn Cumulat
Slide 13: Commercial Real Estate… Core Assets currently contributing 16% to Net Profit
PHD IN BRIEF Commercial Real Estate1… Core Assets currently contributing 16% to Net Profit Palm Club, West Cairo Novotel October, West Cairo Land Size 85k sqm Operations began 2005 Targeted Sales EGP2.5 bn Hotel Category 3 Stars Cumulative New Sales EGP330 mn Number of Keys 195 PHD’s Effective Owner
Slide 14: Clear Construction Program until 2024
PHD IN BRIEF Clear Construction Program until 2024 Construction Spend (EGP bn) Land Liabilities Repayment (EGP mn) EGP27.6 bn 830 EGP3.4 bn 4.97 Planned spend1 Planned land payments2 4.62 4.66 4.40 614 3.49 530 476 476 476 2.15 2.26 1.02 45 2018 2019 2020 2021 2022 2023 2024 2025 2018 2019 2020 2021
Slide 15: Ambitious Plans to Create Value for Shareholders
PHD IN BRIEF Ambitious Plans to Create Value for Shareholders Sales Rollout of Existing Inventory1 (Units) Cash Flow from Operations (EGP bn) 11.4k Units excluding Badya project, which will offer 4.5 EGP24.2 bn Projected CF from Operations2 2,588 2,416 c.34.5k Units To be launched in 2Q2018 3.3 2,09
Slide 16: Project's Forecasted Cash Flows
BADYA Project’s Forecasted Cash Flows Project’s Inflow(1) (EGP mn) NUCA’s Revenue Share(2) (EGP mn) 15,030 13,803 7,100 EGP446bn 11,065 12,484 EGP25.2 bn 9,246 Payments to the Government 4,492 7,609 3,646 6,207 2,998 4,598 3,337 1,682 1,871 1,496 2,114 808 1,037 603 554 315 2018 2019 2020 2021 2022
Slide 17: Net Asset Valuation Per Share
PHD IN BRIEF Net Asset Valuation Per Share1 Old Projects/Projects Under Development New Projects EGP Pre-Tax EGP Millions EGP Millions NAV 20 Present Value of Receivables 6,084 Palm Hills New Cairo - Residential 2,354 18.31 Palm Hills New Cairo - Commercial 3,276 18 Present Value of Available for Sa
Slide 18: Risks & Market Concerns are Well Taken Care Of
PHD IN BRIEF Risks & Market Concerns are Well Taken Care Of Flexible terms and conditions embedded with the co- Given the current development agreements, reducing potential supply/demand mismatch, financial burdens in case of slowdown in demand for demand for primary housing primary housing. Co-deve
Slide 19: Key Financials
3 Golf Views, West Cairo Key Financials CASA, West Cairo
Slide 20: Record New Sales of EGP10.5 bn in 2017, 24% Growth YoY
KEY FINANCIALS Record New Sales of EGP10.5 bn in 2017, 24% Growth YoY New Sales1 (EGP mn) PHD’s Average Selling Prices & Construction Cost (EGP/sqm) New Sales Number of Units Apartments Land Standalone Units Construction Cost 10,539 8,467 14,391 15,493 10,387 13,757 11,984 6,332 6,500 8,337 8,527 4,
Slide 21: Construction Spend to EGP2.1 bn
KEY FINANCIALS Construction Spend to EGP2.1 bn Construction Progress1 Inventory Breakdown (Delivery/Backlog)2 (Percentage Completed) Handovers by Region Completed Remaining 10% Total Inventory 23,545 2,049 1,781 1,573 351 90% Launched To be launched 17,127 6,418 347 658 1Q2018 981 1210 282 499 Contr
Slide 22: Strong profitable growth across the board, EGP224 million Net Profit in 1Q2018
KEY FINANCIALS Strong profitable growth across the board and realize EGP224 million in Net Profit after Tax & Minority Interest during 1Q2018 Revenue (EGP mn) Gross Profit (EGP mn) EBITDA (EGP mn) 26% 2,103 37% 24% 1,347 18% 6,604 20% 5,631 33% 1,679 32% 18% 31% 1,015 28% 32% 20% 3,642 1,150 30% 654
Slide 23: Concluded Securitization & Discounting of EGP629 mn in Receivables in FY2017
KEY FINANCIALS Concluded Securitization & Discounting of EGP629 mn in Receivables in FY2017 Net Debt/EBITDA Receivables/Net Debt Net Debt/Equity Net Debt Net Debt/EBITDA Net Debt Net Debt/Equity Receivables Net Debt 3,714 3,553 3,714 8.5 3,553 15,252 15,753 2,658 0.6 0.5 2,658 5.2 3.5 11,350 1,464 3
Slide 24: 2018 Outlook & Guidance
KEY FINANCIALS 2018 Outlook & Guidance Given the healthy demand for primary housing which is driven by ongoing house formation and growing migration New Sales trend from the capital city of Cairo to the Eastern and Western suburbs, management is eying New Sales of EGP12.0 bn EGP12.0 bn, to be fueled
Slide 25: Appendix
4 Hacienda White, North Coast Appendix Golf Views, West Cairo
Slide 26: Palm Hills New Cairo, East Cairo
NEW PROJECTS Palm Hills New Cairo, East Cairo Project Master Plan Pros ♦ PHD signed a co- development agreement ✓ Lower initial cash outlays with NUCA in March ✓ Replenish PHD’s Land Bank and 2015 presence in East Cairo ♦ SWA Group finalized ✓ Develop Large Integrated the master plan in July Communi
Slide 27: Palm Hills New Cairo – Commercial
NEW PROJECTS Palm Hills New Cairo – Commercial ♦ Commercial area Project Master Plan Recreational Club - Perspective master-planning started in 4Q2016 ♦ The project will be positioned as a hub for mixed-use commercial properties serving the area of New Cairo over a radius 15 km ♦ Phase 1 is planned
Slide 28: Capital Gardens, East Cairo
NEW PROJECTS Capital Gardens, East Cairo Project Master Plan Pros ♦ Co-Development project with Madinet Nasr for ✓ PHD’s first co-development project Housing & in East Cairo Developments ✓ Project allows PHD to cater to (“MNHD”) spanning 100 middle income bracket feddan in East Cairo in ✓ Project re
Slide 29: Hacienda West, North Coast
NEW PROJECTS Hacienda West, North Coast Project Master Plan Pros ♦ In February 2016, PHD signed a Co- ✓ Prime location with a large beachfront Development ✓ Access to nearby new highway agreement with private connecting to Cairo in a couple of land owner in the North hours Coast spanning 139.4 ✓ Rep
Slide 30: The Crown, West Cairo
NEW PROJECTS The Crown, West Cairo Project Master Plan1 Pros ♦ In January 2017, PHD acquired 190 feddan ✓ Prime location adjacent to the Company’s old projects as well as plot located in 6th of Golf Views and Golf Extension October City from the projects Egyptian Ministry of ✓ Project will allow PHD
Slide 31: Alexandria
NEW PROJECTS Alexandria Project Master Plan1 Pros ♦ In February 2017, PHD ✓ Access to Alexandria, Egypt’s signed a co- second largest city, which did not development agreement see any major development for at with a government least the past 20 years agency with the ✓ First mover into Alexandria, pu
Slide 32: Badya, West Cairo
NEW PROJECTS Badya, West Cairo The Location Project Masterplan The Theme Phase One Palm Hills Developments | 2018 | Investor Presentation 32
Slide 33: Badya, West Cairo
NEW PROJECTS Badya, West Cairo Agreement Highlights Pros ♦ PHD signed the co-development agreement with the Egyptian Ministry of Housing/NUCA on September 11, 2017 ✓ The project expanded PHD’s Land Bank by 12.6 mn sqm, positioning ♦ The project will encompass 12.6 mn sqm (3,000 feddan) with an optio
Slide 34: Projects Under Development
EXISTING PROJECTS Projects Under Development(1) Golf Views, West Cairo Woodville, West Cairo Palm Parks, West Cairo Land Size 2 mn sqm Land Size 0.3 mn sqm Land Size 0.5 mn sqm Type of Units Villas/Twin/Town Type of Units Twin/Town Type of Units Apartments Value of Inventory EGP4.3 bn Value of Inven
Slide 35: Projects Under Development
EXISTING PROJECTS Projects Under Development(1) Golf Extension, West Cairo Palm Valley, West Cairo Palm Hills Katameya, East Cairo Land Size 1 mn sqm Land Size 219k sqm Land Size 928k sqm Type of Units Villas/Twin/Town Type of Units Standalone Units Type of Units Standalone Units Value of Inventory
Slide 36: Projects Under Development
EXISTING PROJECTS Projects Under Development(1) Palm Hills Katameya Extension, East Cairo Palm Hills Katameya Extension (Ph2), East Cairo PK2 Phase 2 PK2 VGK PHK Land Size 230k sqm Land Size 150k sqm Type of Units Standalone Type of Units Standalone Units Value of Inventory EGP807 mn Value of Invent
Slide 37: Projects Under Development
EXISTING PROJECTS Projects Under Development(1) Hacienda White 2, North Coast Hacienda Bay, North Coast Land Size 472k sqm Land Size 2,411k sqm Type of Units Standalone & Apartments Type of Units Standalone & Apartments Value of Inventory EGP2.1 bn Value of Inventory EGP6.1 bn Number of Units 824 Nu
Slide 38: Income Statement
FINANCIAL STATEMENTS Income Statement(1) In EGP 000’s 1Q2018 1Q2017 % Revenue 1,465,453 1,588,961 (8%) Cost of Revenue (918,137) (1,100,546) (17%) Gross Profit 547,315 488,414 12% Gross Profit Margin 37% 31% 6pp General Administrative, Selling and Marketing Expenses (166,601) (164,257) 1% EBITDA 380
Slide 39: Balance Sheet
FINANCIAL STATEMENTS Balance Sheet(1) EGP Thousand March 31, 2018 December 31, 2017 EGP Thousands March 31, 2018 December 31, 2017 Long-Term Assets Investment Purchase Liabilities - - Investments in Associates 82,625 83,615 Notes Payable - Short Term 1,385,911 1,239,625 Investment Property 761,832 7
Slide 40: Cash Flow Statement
FINANCIAL STATEMENTS Cash Flow Statement EGP Thousands March 31, 2018 March 31, 2017 EGP Thousands March 31, 2018 March 31, 2017 Net Profit for the period (Before Income Tax & Non- 304,073 293,693 Cash Flows from Investing Activities Controlling Interest) Payments for Purchase of Fixed Assets (15,04
Slide 41: Subsidiaries & Projects
CORPORATE STRUCTURE Subsidiaries & Projects Palm Hills Development Palm Hills Botanica Bamboo Cascade Golden Palm Golf Extension Woodville Golf Views SAE Katameya New East Cairo for Palm Hills Middle New Cairo for Real Estate Saudi Urban Palm Hills for Macor for Securities Real Estate East Co. for R
Slide 42: Contacts
INVESTOR RELATIONS Contacts IR Team Download our IR App Mamdouh Abdelwahab Investor Relations & Investments Director Download the App on your smart phone or tablet today: Radwa Abu El Naga Investor Relations Manager IOS: https://itunes.apple.com/app/ Contact Details id1075708830 Investor.relations@p
Slide 43: Disclaimer
DISCLAIMER THIS PRESENTATION IS BEING PROVIDED TO YOU ON A CONFIDENTIAL BASIS AND MAY NOT BE DISTRIBUTED OR REPRODUCED IN ANY FORM. THIS PRESENTATION IS INTENDED FOR INFORMATION PURPOSES ONLY AND DOES NOT CONSTITUTE OR FORM PART OF AN OFFER FOR SALE OR SUBSCRIPTION OR AN INVITATION OR SOLICITATION O
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