Palm Hills Developments | January 2015 · 2019. 4. 15. · Palm Parks 470 418 259 159 52 Golf Views...
Transcript of Palm Hills Developments | January 2015 · 2019. 4. 15. · Palm Parks 470 418 259 159 52 Golf Views...
Palm Hills Developments | January 2015
Investor Presentation
April 2019
Market Overview
1
Palm Hills Developments | 2019 | Investor Presentation
Housing Units Supply Evolution (‘000)
3
MARKET OVERVIEW
Egypt’s Unique Dynamics and Urbanization Trends
Source: CAPMAS, FRA, and Jones Lang LaSalle Cairo Real Estate Market Overview 2Q20171 Assumed by PHD
♦ Demand is estimated in
the upper middle to high
end market segments to
be 7% - 9% of annual
marriages or 70 - 90k
units per annum
♦ Supply as reported by
CAPMAS is around 35k
units for the same
segments
♦ Market gap estimated at
35 - 55k units (primary
demand) in addition to
those moving from Cairo
to the suburbs estimated
at another 30 - 40k units
0.0
146
96
2510
Low Economic Middle Upper Middle High End
196 184 177
136 146
352
264277
2010 2011 2012 2013 2014 2015 2016 2017
Upper-mid/Luxury
Housing
Middle
Housing
Low Cost
Housing
Targeting Households with annual
income of
USD65 - 125K
Targeting Households with annual
income of
USD10 - 25K
Targeting Households with annual
income of
USD1.7 - 2.5K
Middle/Upper
Housing1
Targeting Households with annual
income of
USD25 - 65K
19.4%18.3%
9.1%
1.6% 1.2%0.2%
UAE Morocco Tunisia SaudiArabia
Qatar Egypt
2017 Housing Units Supply Breakdown by Class (‘000)
Potential Opportunities 2015 Mortgage Penetration Rate (%)
Palm Hills Developments | 2019 | Investor Presentation 4
MARKET OVERVIEW
…And is Expected to Maintain Its Growth Profile Over the Foreseeable Future
Source: IMF, Euro-monitor and Bloomberg
2018E - 2023E CAGR
2,4803,340
3,9884,674
5,3446,034
6,8107,687
2016 2017 2018 2019 2020 2021 2022 2023
Lending Rates (%) Private Consumption (EGP bn)
15.75%
19.75%
16.75%
13.25%11.25%11.25% 11.25%11.25%
2016 2017 2018 2019 2020 2021 2022 2023
2,267
3,069 3,674
4,313 4,929
5,570 6,291
7,106
2016 2017 2018 2019 2020 2021 2022 2023
A portion of the freed up liquidity resulting from the
20% yield CDs maturing in 2018 will spill over into the
real estate sector
…Underpinned by Rising Prosperity
Disposable Income (EGP bn)
Growing Population (mn) High Urbanization Rates (%)
9092
9496
98100
102104
2016 2017 2018 2019 2020 2021 2022 2023
986
999
1,012 1,021
1,030 1,038
1,048
1,061
2016 2017 2018 2019 2020 2021 2022 2023
44.4%44.7%
44.9%45.2%
45.5%
45.9%
46.2%
46.6%
2016 2017 2018 2019 2020 2021 2022 2023
Egypt Boasts an Attractive Demographic Profile…
Increasing Marriages (‘000)
♦ Egyptians are expecting a
substantial influx of
liquidity due to the
following:
▪ The maturity of the
20% 18-month CDs
which have attracted
more than EGP840 bn
▪ The maturity of the
Suez Canal CDs which
have attracted more
than EGP64 bn
▪ Lowering interest rates
as inflation continues to
ease
▪ In addition to the post
revolution baby boom,
the long term
underlying
demographics of Egypt
will continue to support
the Egyptian real estate
sector and ensure a
sustainable and stable
stream of demand for
housing
Palm Hills Developments | 2019 | Investor Presentation 5
19,600
12,400 16,044
29,086
42,074
52,684
64,996
90,707
105,287
119,502
2010 2011 2012 2013 2014 2015 2016 2017 2018F 2019F
MARKET OVERVIEW
Resilient Real Estate Market Expected to Continue in FY2019
Contracted Sales Evolution (EGP mn)1
▪ January 25
Revolution
▪ President
Morsi
assumes
power
▪ Anti-Morsi
protests begin
which led to
Morsi being
ousted
▪ Sisi elected
as president
▪ Sinai
explosion
▪ Egypt Economic
Development
Conference (“EEDC”)
launched
▪ New Suez Canal
launched
▪ Russian plane crash▪ Subsidy cuts
▪ VAT system
announced
▪ EGP flotation
▪ Egypt plane crash
▪ Policy rates hikes
▪ Headline CPI
reached its
highest level since
2011 in Jul 2017
Source: Companies filings, and research reports 1 Market contracted sales are calculated as the sum of contracted sales of PHD, MNHD, Emaar Misr, SODIC, TMG and the
remaining players are assumed to contribute to 50% of the market
♦ The Egyptian real estate
market remained resilient
despite the political turmoil
and economic challenges
♦ During times of high inflation
and currency depreciation,
investors shifted towards real
estate investments as a hedge
to protect the value of their
wealth
♦ The Egyptian real estate sector
is expected to be on a fast-
track growth trajectory,
spurred by:
▪ Robust economic growth
on the back of economic
and political reforms
▪ The government
encouraging expansion
into surrounding areas,
especially to the east
and west of the city
▪ Rising purchasing power
and accelerated
household formation,
especially for the middle
class, as economic
growth has accelerated
2010 – 2017 CAGR2017 – 2019 CAGR
PHD in Brief
2
Palm Hills Developments | 2019 | Investor Presentation 7
Raw Land
Project NameLand Area
(000 sqm)
Residential
Land Area (000
sqm)
Developed
Residential Land
(000 sqm)
Area Under
Development
(000 sqm)
Commercial Area
(000 sqm)
Botanica 7,138 - - - -
Riyadh, KSA 5,000 - - - -
Red Sea 92 - - - -
Subtotal 12,230 - - - -
Total Land Bank 40,657 25,889 8,917 5,695 2,524
Recently launched projects.
Raw Land Strategy
▪ Botanica land plot: PHD’s Management learned about the reallocation and rezoning of some state-
owned land on Cairo Alexandria highway to the New Urban Communities Authority (“NUCA”) in
accordance with the recent presidential decrees, which will positively impact Botanica’s allowable
built up area and valuation as part of the New Sphinx City, given Botanica’s proximity to Sphinx
International Airport. The Company awaits official communication from NUCA in that regards.
▪ Saudi Arabia land plot: Held for sale.
▪ The Company sold one of its non-core land plots (Galala plot in the North Coast) spreading 487k
sqm to a non-listed property developer, for a total consideration of EGP375 mn including capital
gain of EGP218 mn during 4Q2017.
Completed Projects
Project NameLand Area (000
sqm)
Residential Land
Area (000 sqm)
Developed
Residential Area
(000 sqm)
Area Under
Development
(000 sqm)
Commercial Area
(000 sqm)
Phase 1-5 &
Cascade, Bamboo,
Goldan Palm
1,659 1,542 1,542 - 98
Bamboo Extension 168 168 168 - -
The Village 105 105 105 - -
Village Avenue 35 35 35 - -
Village Gate 146 131 101 10 16
CASA 294 294 294 - -
Village Garden
Katameya297 285 267 - 13
Palm Hills Katameya
Extension275 275 173 37 -
Hacienda White 1 216 199 199 0 17
Subtotal 3,195 3,034 2,884 47 144
Projects Under Development/Launched Projects
Project NameLand Area
(000 sqm)
Residential Land
Area (000 sqm)
Developed
Residential Area
(000 sqm)
Area Under
Development
(000 sqm)
Commercial Area
(000 sqm)
Palm Parks 470 418 259 159 52
Golf Views 2,061 2,049 1,798 251 12
Golf Extension 1,012 958 958 - 54
Woodville 289 251 - 251 38
Palm Valley 238 206 - 206 11
Palm Hills Katameya 928 928 904 - 24
Palm Hills Katameya
Extension "Phase 2" 159 159 - 159 -
Palm Hills New Cairo 2,100 1,680 - 2,100 420
Capital Gardens 434 434 - 434 -
The Crown 798 734 - 734 64
Hacienda West 585 585 - 585 -
Badya(2) 12,600 11,088 - - 1,512
Alexandria(3) 567 482 - 85
Hacienda Bay 2,519 2,411 1,911 500 108
Hacienda White 2 472 472 203 269 -
Subtotal 25,232 22,855 6,033 5,648 2,380
1 Land Bank data as at December 31, 2018, which excludes 205 feddan in West Cairo. Management
expects to conclude the co-development agreement during 1H2019.2 PHD signed the co-development agreement with NUCA on September 11, 20173 Palm Hills Alexandria project’s soft launch was held mid December 2018
PHD IN BRIEF
The Largest Land Bank1 in Egypt of 41 mn sqm
Palm Hills Developments | 2019 | Investor Presentation
♦ PHD offers secondary homes by the
Mediterranean sea in 4 projects in the North
Coast, catering to upper middle to upper class
♦ The net cumulative number of secondary homes
sold reached 3,005 units as at end of 2018
♦ The Company launched Hacienda West in June
2017 and completed Hacienda White 1 and
handed over a cumulative number of 2,394
units in Hacienda White 1, 2 and Hacienda
Bay as at end of 2018
♦ Customers are mostly households
♦ PHD offers first homes in 24 projects in West
and East Cairo since 1997, catering to
various income brackets starting from middle
to upper class
♦ The Company completed 12 projects and
delivered 4,968 units in such projects as at
end of 2018
8
PHD IN BRIEF
Boasting a Well Diversified and Balanced Project Portfolio
…As Well as Strong Recurring Revenue Streams
First Homes
Secondary
Homes
Commercial♦ PHD owns approx. 2.5 mn sqm of land allocated
for commercial projects
♦ The commercial portfolio includes 3 operating
hotels managed by Accor
♦ The Company recently started to unlock and
monetize value from non-core commercial assets
with the launch of Palm Valley Mall and Palm
Central Office Building in West Cairo and VGK
Mall in East Cairo
♦ PHD plans to develop PHNC commercial
component with a recreational club, retail &
administrative complex, and an international
school
10%
PHD mitigates residential real estate earnings volatility through
commercial real estate yielding assets, allocating 2.5 mn sqm of
its undeveloped land bank for commercial projects
% of 2018 Net Profit
A Well Diversified Land Bank…
…With 33% Currently Launched / Under
Development
PHD Commands a Geographically Diversified and Balanced Project Portfolio…
% of 2022 Net Profit
20%Target
West Cairo48%
Red Sea & Other Locations18%
KSA12%
East Cairo11%
North Coast9%
Alexandria1%
Launched Projects/Projects
Under Development
33%
Raw Land30%
Projects to be
Launched29%
Completed Projects
8%
Project Location Status
Mercure Ismailia Operating
Novotel October West Cairo Operating
Novotel Sharm El Sheikh South Sinai Operating
Palm Club West Cairo Operating
Palm Central West Cairo Operating
The Lane West Cairo Under Development
Village Garden
Katameya MallEast Cairo Under Development
Village Gate East Cairo Under Development
Golf View West Cairo Under Development
Palm Hills New Cairo
CommercialEast Cairo Under Development
Badya Commercial West Cairo Under Development
Palm Hills Developments | 2019 | Investor Presentation
4.8 6.5 7.4
10.4 14.4
19.0
2.3 3.0 3.5 5.4
8.1 9.4
4.2
6.8 8.3 8.5 12.0 13.5
2.0 2.6 2.7 3.2 4.1
4.1
2013 2014 2015 2016 2017 2,018
Apartments Standalone Units Land Construction Cost
9
PHD boasts a stellar track record of project deliveries and owns the largest land bank among
Egyptian real estate players
29 Projects Portfolio
61
Co-Development
Projects
New Sales have been steadily growing at a 2013 -2018 CAGR of 61%.
Moreover, PHD was able to increase its selling prices for apartments,
standalone units, and land at a 2013-2018 CAGR of 32%, 26%, 33%
respectively
13Projects Completed
20051997-2004 2006 2007 2008 2009 2010 2013 2014 2015 2016 2017 2018
1 2205 Feddan
Project
Growing New Sales (EGP bn)
9,643
Cum. Delivered Units as
at end of 2018
15,156
Cum. Net Units Sold as
at end of 2018
PHD mitigates the cyclical nature of residential real estate through its
recurring income portfolio, allocating 2.5 mn sqm of undeveloped land bank
to commercial projects
10%
% of 2018 Net Profit % of 2022 Net Profit
20%Target
A Diversified Commercial Assets Portfolio
Project Mercure Novotel SharmNovotel West
Cairo
Palm Club
October
PHNC
Commercial2
Operational Year 1980 1996 2005 2005 2020F
PHD Ownership 55% 50% 80% 100% Varies by project
Escalating Selling Prices
(000’s EGP/sqm)
PHD launched an expedited construction plan in 2013, aided by equity and debt raising, helping it
increase its construction spending, reflecting positively on unit deliveries
Exceeded the annual
target of 1,500 units
PHD IN BRIEF
Successfully Delivering on our Corporate Strategy
1 Including the awarded 205 feddan land plot
2 PHNC Commercial stands for Palm Hills New Cairo commercial component. PHD expects to own 100% of PHNC club, 60% of
the retail and administrative complex and 50% of PHNC school
3 Excluding Badya’s selling prices
3
40,657
3,195
13,485 11,747
7,230
5,000
CompletedProjects
Projects UnderDevelopment
Projects to beLaunched
Raw Land Total
Egypt’s Largest Land Bank (‘000 sqm)
Saudi Arabia land plot - currently earmarked for sale
Construction Spending (Earned Value EGP mn)
Handover (Units)
1,159 1,868 2,005 2,148
1,550
2014 2015 2016 2017 2018
981 1,573
2,049 1,781 1,541
2014 2015 2016 2017 2018
1.2
3.9
6.3
8.5
10.512.5
2013 2014 2015 2016 2017 2018
Palm Hills Developments | 2019 | Investor Presentation 10
PHD IN BRIEF
Spearheaded by a Seasoned Management Team
Board of Directors Executive Management
Board Member Position
Yasseen Mansour Chairman & Group CEO
Mohamed Mansour Vice Chairman
Tarek Abdel Rahman Non-executive Board Member
Mohamed Ahmed Sultan Chief Executive Officer
Ali Thabet Chief Financial Officer
Yasser El Mallawany Non-executive Board Member
Youssef M. Medhat El Far Non-executive Board Member
Hassan Darwish Non-executive Board Member
PHD’s management is characterized by…
✓ Diverse experience in their respective fields
✓ Solid industry knowledge
✓ Strategic approach in decision making
✓ Hands on management and strong involvement in running of
the business
✓ Leadership capabilities and guidance of employees
Yasseen Mansour Chairman & Group CEO
Mohamed SultanChief Executive Officer
Dr. Azza El Bendary
Chief HR&A Officer
Mr. Yasseen Mansour serves as Chairman of the Board of Directors and Group CEO of
PHD, and has guided the Company from a single-project entity into a leading real
estate player in Egypt. Mansour began his career in 1986 at Mansour Motors Group,
and has since lead the companies he owns and presides over to growth
Eng. Mohamed Sultan joined PHD in 2008 as VP Development – North Coast and
Alexandria, and was appointed CEO in 2011. Sultan began his career at OBALCO,
working with the US Army Corp of Engineers. In 1986, Sultan founded the Engineering
Group for Urban Development, of which he is President. Sultan holds a bachelor’s
degree in Architectural Engineering from Al Azhar University
Mona El Helw
Chief Commercial
Officer
Ahmed Atalla
SVP Development
West Cairo
Amr Mahfouz
VP Development
East Cairo
Ali ThabetChief Financial Officer
Mr. Ali Thabet joined PHD in 1997 as VP for Finance, Accounting and Administration,
and was promoted to CFO in 2011. Previously, Thabet ran his own office for
Chartered Accounting and Financial Management Services. Thabet holds a B.Sc. of
Commerce from Ain Shams University and received a Master in International Business
Administration from ESLSCA Business School
Palm Hills Developments | 2019 | Investor Presentation
PHD IN BRIEF
That Was Able to Replenish the Company’s Land Bank by Entering into Co-Development
Agreements…
11
PHNC Capital Gardens Hacienda West Alexandria Badya 205 feddan
Date March 2015 July 2015 February 2016 February 2017 July 2017 March 2019
Land Area
(Sqm)2,100k 434k 585k 769k 12,600k 861k
Location East Cairo East Cairo North Coast Alexandria West Cairo West Cairo
Seller/ Partner
and Terms
▪ A Co-Development project
with NUCA
▪ PHD will be entitled to 72%
revenue share
▪ NUCA will be entitled to cash
revenue share of 28.4%, in
addition to an in-kind
payment of BUA of 150k sqm
▪ NUCA will be entitled to a
minimum guarantee of EGP10
bn payable over 13 years
▪ PHD is responsible for the
development and
management of the project
▪ A Co-Development
agreement with Madinet Nasr
Housing and Development
(“MNHD”) spanning 100
feddan in East Cairo in its
Sarai project
▪ PHD will be entitled to 64%
revenue share
▪ PHD will be responsible for
all construction and
development related costs
while MNHD will contribute
the land and accompanying
infrastructure
▪ A Co-Development
agreement with a private
land owner in the North Coast
▪ PHD will be entitled to a
revenue share of 80%, with
partner holding the remaining
20%, at a minimum revenue
guarantee of EGP200 mn
over 10 years
▪ PHD will be responsible for
all construction, development,
internal infrastructure,
marketing and sales activities,
while the owner will be
contributing the land
▪ A Co-Development
agreement with a government
agency with the purpose of
co-developing on revenue
sharing basis 135 feddan in
Alexandria
▪ PHD will be entitled to a
revenue share of 65%, with
the partner holding the
remaining 35%
▪ PHD will be responsible for
all construction, development,
infrastructure, marketing and
sales activities of the project
▪ A Co-Development
agreement between PHD and
NUCA
▪ PHD will be responsible for
all construction and
development related costs
▪ NUCA will be contributing the
land bank in addition to all
the external associated
infrastructure
▪ NUCA will be entitled to a
cash revenue share of 25.3%
in addition to an in-kind
payment of up to 371k sqm
of residential BUA and 50k
sqm of commercial BUA
▪ A Co-Development
agreement with NUCA
through Palm Alamein, which
is 40% owned by PHD and
60% by Arkan Developers
▪ NUCA will be entitled to an
fixed annual cash portion of
up to EGP10 billion payable
over 12 years (NPV of
EGP2.5 billion at discount
rate of 16%) and will also
receive an annual revenue
share of 12.5% from the
project’s proceeds of EGP13
billion (NPV EGP3.5 billion)
payable over 10.5 years,
starting after 1.5 years from
signing the agreement, plus
an in-kind portion of BUA of
95.5k sqm (33k sqm
residential and 62.5k sqm of
commercial space)
Launch Date 4Q2016 4Q2015 2Q2017 1Q2019 2Q2018 4Q2019E
Project
Highlights
▪ Project includes 4,588 units
with a total BUA of 1.03 mn
sqm
▪ Sales since launch EGP5.9 bn
▪ 2,513 units with a total BUA
of 494,000 sqm
▪ Integrated residential
community over four phases
up until 2024
▪ Sales since launch c.EGP2 bn
▪ 812 units, with a total BUA
of 145,000 sqm
▪ Include community retail
facilities
▪ Sales since launch EGP1.2
bn
▪ 3,225 mixed use residential
units with a total BUA of
575,000 sqm and 102,213
sellable land area
▪ Integrated community with
complete residential complex,
complemented by full
spectrum of commercial
facilities
▪ 34,561 residential units with
a total BUA of 6.4 mn sqm
▪ Sales since launch EGP4.8 bn
▪ 3,300 units with a total BUA
of 1.03 mn sqm
▪ Integrated residential &
commercial community
Palm Hills Developments | 2019 | Investor Presentation
426
239 353
490
639 806 812
2013 2014 2015 2016 2017 2018
1,163
3,936
6,332
8,467
10,539
12,463
2013 2014 2015 2016 2017 2018
959
2,106
3,642
5,631
6,604
7,422
2013 2014 2015 2016 2017 2018
541
981
1,573
2,049
1,781
1,555
2013 2014 2015 2016 2017 2018
…And Improved Profitability…Which in Turn, Resulted in Increasing Recognized Revenues…
New Sales (EGP mn) Construction Spending (EGP mn)
A Surge in New Sales … …And a Pick-up in Construction Activity…
Revenue (EGP mn) Net Profit (EGP mn)
In 2015, the Company sold two land plots
located in Alexandria and North Coast
2013-2018 CAGR
PHD IN BRIEF
Successfully Concluded a Turnaround and Growth Story
12
♦ The Company’s operational
turnaround translated into
robust growth in new sales,
construction outlay and
revenue, reporting 2013-2018
CAGRs of 50% in Revenue.
♦ New Sales (Residential and
Commercial) amounted to
EGP12.5 bn, a growth of 18%
YoY. Growth was largely
driven by strong uptake of
launched units in Badya
(EGP4.8 bn/1,935 units sold),
demand for residential units in
Palm Hills New Cairo, and the
remarkable 168% YoY growth
in commercial sales to record
EGP1.8 bn.
♦ PHD has spent c.EGP8.5 bn on
construction activity from 2013
to 2018, capitalizing on the
rights issues and bank
borrowings, which accelerated
projects delivery and
translated into superior
profitability where the
Company registered a net
profit 2013-2018 CAGR of
28%.
Key Financials
3
Palm Hills Developments | 2019 | Investor Presentation
New Sales1 (EGP mn) PHD’s Average Selling Prices & Construction Cost (EGP/sqm)
FY2018 New Sales1 (Percentage by Location) Highlights
KEY FINANCIALS
18% YoY growth in New Sales to EGP12.5 bn driven by Badya, PHNC, and strong uptake of commercial offerings
14(1) New Sales represent Gross New Sales including residential and commercial segments.
6,332
8,467
10,539
12,463
2,140 1,894 2,136 3,102
2015 2016 2017 2018
59%
27%
4%
West Cairo EGP7.4 bn
East Cairo EGP3.4 bn
North Coast EGP1.6 bn
New Sales (Residential and Commercial) amounted to EGP12.5 bn, a growth of 18% YoY with 3,102 units sold, compared to
2,136 units during FY2017. Growth in New Sales was led by the successful launch of Badya, continued uptake of residential
units in Palm Hills New Cairo, complemented by the remarkable 168% YoY growth in commercial sales to EGP1.8 bn. During the
year, the Company sold PK2 Mall, clinics in Hale Town, and retail space in Hacienda Bay’s Lake Yard, Golf Extension, VGK
Mall, and The Lane Mall.
During the year, commercial sales witnessed an unprecedented growth of 168% YoY to record EGP1.8 bn, driven by the sale of
PK2 Mall in East Cairo, retail outlets in Hacienda Bay’s Lake Yard, in addition to units in VGK and The Lane Malls, as well as
sales of retail space in Golf Extension and clinics (Hale Town) in Golf Views.
Total number of units sold (residential and commercial) increased 45% YoY to 3,102 units (2,136 units in FY2017), comprising
2,977 residential and 125 commercial units.
The Company handed over 1,541 units, surpassing its previously announced target of 1,500 units in FY2018. The majority of
handed overs units were in Palm Parks, Golf Views, Golf Extension, Hacienda Bay, and Hacienda White 2. Notably, PHD started
delivering units in Palm Valley and The Lane Mall in West Cairo.
In 4Q2018, New Sales grew 9% YoY to EGP2.6 bn. Residential sales increased 3% YoY to EGP2.3 bn, while commercial sales
witnessed a remarkable 95% growth YoY reaching EGP303 mn.
4,820
6,500
7,350
10,387
14,391
19,000
4,175
6,793
8,337 8,527
11,984 13,483
2,339
2,950 3,500
5,384
8,110 9,440
2,024 2,631 2,707 3,188 4,100
4,100
2013 2014 2015 2016 2017 2018
Apartments (BUA) Land Standalone Units (BUA) Construction Cost
Palm Hills Developments | 2019 | Investor Presentation
425 654
1,015 1,347
1,624
20%18% 18%
20%22%
-20%
-15%
-10%
-5%
0%
5%
10%
15%
20%
25%
-
1,000
2,000
3,000
4,000
5,000
2014 2015 2016 2017 2018
2,106
3,642
5,631
6,604
7,422
2014 2015 2016 2017 2018
705
1,150
1,679
2,103
2,587
33%32%
30%32%
35%
-20%
-10%
0%
10%
20%
30%
40%
-
1,000
2,000
3,000
4,000
5,000
2014 2015 2016 2017 2018
Revenue (EGP mn) Gross Profit (EGP mn) EBITDA (EGP mn)
KEY FINANCIALS
Solid P&L Growth coupled with Improvements in Profitability Margins
152014 – 2018 CAGR
1.4
2.3
3.1
4.6
5.5
2014 2015 2016 2017 2018
Net Income after Tax & Minority Interest (EGP mn) Cash Inflows from Operations (EGP bn)
353
916
640
806 812
17%
25%
11%12% 11%
2014 2015 2016 2017 2018
Palm Hills Developments | 2019 | Investor Presentation
Net Debt/EBITDA Receivables/Net Debt Total Debt/Equity
Land Liabilities(1) and Total Debt (EGP mn)Highlights
The Company successfully concluded its recent EGP1.54 bn Rights Issue, with 3.3 times oversubscription during the second
subscription round. The newly issued shares commenced trading on the EGX & LSE on December 30, 2018.
PHD concluded securitization and discounting of receivables portfolio of EGP942 mn in relation to 663 handed over units
during FY2018, with proceeds mostly directed towards deleveraging the Balance Sheet.
In 1Q2019, the Company expects to finalize discounting and securitization (non-recourse) transactions of receivables
portfolio of c.EGP1.0 bn, in relation to 861 delivered units in the following projects: Palm Parks, Palm Valley, Golf Views,
Golf Extension, Palm Hills Katameya (1 & 2), Hacienda Bay and Hacienda White 2. The transactions’ proceeds will be
utilized entirely in the partial repayment of existing debt.
Net Debt/EBITDA stood at 1.2x in FY2018, down from 2.6x in FY2017. By end of 2018, Receivables recorded EGP18.4 bn,
compared to EGP15.3 bn in 2017, covering Net Debt by 9.4 times.
(1) Land Liability figures represents the Net Present Value of lands payments.
KEY FINANCIALS
Translating Into a Solid Financial Standing
16
5,394 7,621
11,353 15,252
18,385 3.7x
5.0x 4.3x 4x
9x
(0.2x )
1.8x
3.8x
5.8x
7.8x
9.8x
11.8x
-
5,000
10,000
15,000
20,000
25,000
30,000
2014 2015 2016 2017 2018
41%48%
55%64%
53%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2014 2015 2016 2017 2018
1,481 1,464
2,658
3,553
1,950
2.9
2.2
2.6
2.6
1.2
2014 2015 2016 2017 2018
Net Debt Net Debt/EBITDA
1,557 842 875
3,432 3,420
1,676 3,110 3,620
4,583 4,657
2014 2015 2016 2017 2018
Land Liabilities Total Debt
Palm Hills Developments | 2019 | Investor Presentation
To be Launched, 38125
Total Inventory, 58254
Launched, 20129
Sold, 15047 Unsold, 5082
Handed Over, 9233 Backlog, 5814
427 685
879
1,246
795
294
616 399
342
463
267
567 727
560
296
2014 2015 2016 2017 2018
West Cairo East Cairo North Coast
2,399 2,631 2,707
3,188
4,100 4,100
2013 2014 2015 2016 2017 2018
Handovers by Region
Construction Spending (Earned Value) by Region (EGP mn) Average Construction Cost / sqm
Inventory Breakdown (Delivery/Backlog)2
(1) Average construction progress PoC calculation for existing projects and projects under development;
(2) Inventory excluding Alexandria project and as of December 31, 2018.
Floatation of local currency took place in November 2016, while the partial
removal of fuel subsidy took place in June 2017.
KEY FINANCIALS
Delivering on Schedule
17
561727
488 475
919138
4991210
648
128282
347
351
658494
981
1,573
2,049
1,781
2014 2015 2016 2017 2018
1,541
Palm Hills Developments | 2019 | Investor Presentation
KEY FINANCIALS
2019 Outlook & Guidance
18
EGP14.0 bn
New Sales
Management is eyeing further improvements in profitability margins, on the back of expectations to deliver higher
margins units alongside foreseen YoY growth in sales of standalone units.
EGP2.2 bn
Construction Spend
1,350 homes
Handovers
Above EGP7.5 bn
Revenue
Above 38%
Gross Profit Margin
Above EGP1 bn
Net Profit
The Company expects to achieve New Sales of EGP14.0 bn, with sales growth to be driven by Badya, Palm Hills
Alexandria, Palm Hills New Cairo and The Crown complemented by further monetization of commercial assets.
Management is targeting to complete a number of projects during 2019 including: Palm Valley, Golf Extension and
Woodville in West Cairo, as well as Palm Hills Katameya extension 2 in East Cairo.
The Company is targeting to deliver 1,350 units in 2019 (lower number compared to 2018), as the sales backlog
of projects under development projects come to an end between 2019-2020.
Management expects a solid top line, driven by the handovers coupled with new sales in Alexandria and Badya in
2019
Bottom line should improve further as the Company deliver higher margin units and reduce G&A further.
Appendix
4
Appendix - Commercial Projects
Palm Hills Developments | 2019 | Investor Presentation
APPENDIX
Commercial Real Estate1 - Monetization of Non-Core Assets Underway
21
Land Size 12k sqm
Sellable Area 4.5k sqm
Targeted Sales EGP170 mn
Cumulative New Sales EGP161 mn
PHD’s Effective Ownership 100%
PHD’s Share from Sales 100%
Construction Cost EGP7k/sqm
Sales Launch Date 2Q2017
Completion Date 2018
Estimated Profits to PHD EGP70 mn
The Lane, West Cairo
Village Garden Katameya Mall, East Cairo
Land Size 11k sqm
Sellable Area 11k sqm
Targeted Sales EGP660 mn
Cumulative New Sales EGP629 mn
PHD’s Effective Ownership 51%
PHD’s Share from Sales 55%
Construction Cost NA
Sales Launch Date 2Q2017
Expected Completion Date 2019
Estimated Profits to PHD EGP322 mn
Land Size 13k sqm
Sellable Area 10k sqm
Targeted Sales EGP400 mn
Cumulative New Sales EGP448 mn
PHD’s Effective Ownership 100%
PHD’s Share from Sales 60%
Construction Cost NA
Sales Launch Date 2Q2016
Expected Completion Date 2019
Estimated Profits to PHD EGP198 mn
1 Projects data as at September 30, 2018
Village Gate, East Cairo
Hale Town, West Cairo
Land Size 16k sqm
Sellable Area 10.5k sqm
Targeted Sales EGP220 mn
Cumulative New Sales -
PHD’s Effective Ownership 51%
PHD’s Share from Sales -
Construction Cost 5,333
Sales Launch Date TBC
Expected Completion Date TBC
Estimated Profits to PHD NA
Land Size 12k sqm
Sellable Area 11k sqm
Targeted Sales 420
Cumulative New Sales 62 mn
PHD’s Effective Ownership 100%
PHD’s Share from Sales 63%
Construction Cost NA
Sales Launch Date 2H2018
Expected Completion Date 2020
Estimated Profits to PHD EGP241 mn
EGP2.4 bn
Palm Central, West Cairo
Cumulative new sales from 3 non-core assets since launch
Palm Hills Developments | 2019 | Investor Presentation
Operations began 1980
Hotel Category 4 Stars
Number of Keys 169
Average Room Rate EGP860/night
Average Occupancy Rate 73%
GOP 45%
NOP 41%
Stake in Asset 55.12%
APPENDIX
Commercial Real Estate1 - Core Assets without retail outlets currently contributing 10% to Net Profit
22
Palm Club, West Cairo
Land Size 85k sqm
Targeted Sales EGP2.5 bn
Cumulative New Sales EGP300 mn
PHD’s Effective Ownership 100%
PHD’s Share from Sales 100%
Sales Launch Date Ongoing
Expected Completion Date Completed
Estimated Membership Capacity 12.5k
Existing Memberships 3.2k
Time to Full Capacity 7-8 years
Mercure, Ismailia
Novotel October, West Cairo
Novotel Sharm El Sheikh, Sinai
Operations began 2005
Hotel Category 3 Stars
Number of Keys 195
Average Room Rate EGP1,250/night
Average Occupancy Rate 81%
GOP 57%
NOP 51%
Stake in Asset 79.95%
Operations began 1996
Hotel Category 5 Stars
Number of Keys 382
Average Room Rate EGP960/night
Average Occupancy Rate 80%
GOP 40%
NOP 37%
Stake in Asset 49.99%
1 Properties data as at December 31, 2018
Palm Hills Developments | 2019 | Investor Presentation 23
♦ PHD is currently negotiating a new
international school brand through
a newly created JV
♦ PHD’s revenues from the
international school project will be
generated from two sources:
♦ The construction of the international
school is set to cost a total of
EGP294 mn, spread over 3 years
starting 2019
International School Certifications
International School Key Facts
▪ 50% of annual
net cash flows
▪ School lease
revenue
calculated as
10% of annual
net revenues
PHD’s Revenue Sources
✓ Internationally accredited school
✓ Strategic location in a high-end residential area
✓ High student capacity compared to other
schools in the surrounding area
International AffiliationSchool AccreditationsTechnical Affiliation
Location Palm Hills New Cairo
Launch date 2020
Students Capacity 1,750
Land Area 60,400 sqm
BUA 29,141 sqm
Key Attractions
APPENDIX
Palm Hills New Cairo - International School
Palm Hills Developments | 2019 | Investor Presentation 24
♦ PHD’s plan of building a recurring
income portfolio continues with
developing a hub for mixed-use
commercial properties serving the
area of New Cairo over a radius
of 15 km
♦ The commercial properties will
include a recreational club, an
international school, and a retail &
administrative office complex
♦ PHD is in the process of designing a
flagship recreational club building
on the success of Palm Club West
Cairo
♦ The project is set to cost EGP787
mn in construction costs, spread
over the span of 5 years starting
2019
♦ The recreational club will be fully
owned by PHD, whereby PHD
receives 100% of the annual net
cash flows
Commercial Component
of Palm Hills New Cairo
Retail & Administrative
Office complexRecreational Club International School
1 2 3
Recreational Club Project Key Facts
PHNC Commercial Component Masterplan
✓ Fully owned by PHD
✓ Strategic location in a high-end residential area
in New Cairo, and a walking distance from
PHD’s international school and retail &
administrative complex
✓ Ample membership capacity of 25,000
memberships
International School Recreational Club Other components
Location Palm Hills New Cairo
Land Area 150,000 Sqm
Maximum Capacity 25,000 Members
Key Attractions
APPENDIX
Palm Hills New Cairo - Recreational Club
Palm Hills Developments | 2019 | Investor Presentation 25
♦ The retail & administrative complex
project will be developed on a
total land area of 105k sqm, and
a total BUA of 90k sqm, split
between offices and retail into 60k
sqm and 30k sqm respectively
♦ PHD will have two sources of
revenue from the project:
Retail & Administrative Complex Location
✓ Prime location in a luxurious area of Cairo
✓ Walking distance from PHD’s recreational club
and international school
✓ Boosted footfall by the project’s office space, will
increase the lease prices of the retail space
As a Project Partner
▪ 60% of annual
net cash flows
As a Landowner
▪ Revenue share:
– 35% of units
sale inflows
– 15% of leasing
inflows
PHD’s Revenue Sources
Retail & Administrative Complex Project Key Facts
Location Palm Hills New Cairo
Launch Date 2019
Land Area 105,000 sqm
Value of Units EGP2.1 bn
Offices BUA 60,000 sqm
Retail BUA 30,000 sqm
Total BUA 90,000 sqm
Key Attractions
Cairo International
Airport
Palm Hills Village
Avenue
Palm Hills Village
Katameya
APPENDIX
Palm Hills New Cairo - Retail & Administrative Complex
Appendix - Residential Projects
Palm Hills Developments | 2019 | Investor Presentation
APPENDIX
Residential Component - Projects Summary
27
Number of
Projects
Delivered Units
Av. For Sale
Inventory1 (EGP bn)
Av. For Sale
Inventory1 (Volume)
Receivables2
(EGP bn)
Remaining Construction
(EGP bn)
Land Liability
(EGP bn)
Cumulative Sales3
(EGP bn)
1- Available for sale inventory as at December 31, 2018 including Alexandria’s project preliminarily figures. Please note that above data
exhibits value of each project including escalations
2- Receivables related to residential projects only
3- Cumulative Net Sales after deducting cancellations
4- Residential component excludes the 205 feddan co-development project
Recognized
Revenue (EGP bn)
Revenue Backlog
(EGP bn)
29
9,643
510
43,114
16.2
181
3.1
41.3
27.6
13.8
Projects
Portfolio
13
4,968
0.07
11
0.4
0.03
0.02
5.7
5.6
0.1
Completed
Projects
10
4,675
5.4
1,027
5.8
2.7
0.2
21.2
18.3
2.3
Projects Under
Development
5
-
60.9
8,008
6.9
31
2.8
10.3
3.1
7.8
New
Projects4
Palm Hills New Cairo, East Cairo
Bamboo Extension, West Cairo
Golf Views, West Cairo
Capital Gardens, East Cairo
1
-
444
34,068
3.1
147
-
4.1
0.6
3.6
Badya
Palm Hills Developments | 2019 | Investor Presentation 28
♦ In September 2017, PHD co-bid
with Arkan Developers (through
Palm Alamein) to acquire a 205
feddan land plot in an attempt to
maximize its land bank through co-
development agreements. Palm
Alamein is 40% owned by PHD
and 60% by Arkan Developers
♦ In September 2018, PHD received
the letter of award for the 205
feddan land plot from NUCA and
to sign a definitive agreement
within 3-6 month
♦ The prime land plot is planned to
be developed into an innovative
residential and commercial project
with potential to include a high rise
tower (c.130 -150 meters).
♦ In March 2018, Arkan Palm for
Real Estate Investment Company
(40% owned subsidiary) signed the
co-development agreement with
("NUCA")
Total Land Area 861,000 sqm
Total Built Up Area 1,033,200 sqm
Total Value of Units EGP78.2 bn1
Completion Date 2029
Select Residential Highlights
Total No. of Units 3,300
BUA 495,000 sqm
Type of Units Apartments & Villas
Select Commercial Highlights
Land Area 688,800 sqm
BUA 538,200 sqm
Types of units
Tower, Clinics, Medical Stores,
Offices Complex, Retail Stores,
and Entertainment
1 Excluding NUCA’s revenue share2 Project key facts are tentative and subject to change according to the final master plan, which is expected to be concluded
during the current year
205 Feddan Project Key Facts2
✓ A strategic land location overlooking 26 of July axis, the
main high street in Sheikh Zayed City adjacent to Nile
University
✓ Lower initial cash outlays
205 Feddan Project Location
NUCA Revenue Share
CashIn Kind BUA
NUCA Revenue Share
▪ Residential in-kind BUA
of 33k
▪ Commercial in-kind
BUA of 62.5k sqm
▪ Fixed annual cash portion of up
to EGP10 billion payable over
12 years (NPV of EGP2.5 billion
at discount rate of 16%)
▪ Annual revenue share of 12.5%
from the project’s proceeds of
EGP13 billion (NPV EGP3.5
billion) payable over 10.5 years,
starting after 1.5 years from
signing the agreement
Key Attractions
APPENDIX
205 Feddan, West Cairo
Palm Hills Developments | 2019 | Investor Presentation 29
♦ On September 11, 2017 PHD
signed the co-development
agreement with NUCA, the project
will encompass 12.6mn sqm (3,000
feddans) with the right of first
refusal on another 3,000 feddans
♦ The project is located in the south-
western edge of 6th of October
City boasting ease of accessibility
on the back of the following
features:
✓ Close to industrial areas
located north of Wahat Road
✓ 15 kilometers away from the
Pyramids, 45 minutes away
from the New Administrative
Capital
✓ Bound by regional road
network including a new ring
road currently under
construction that will directly
connect west Cairo to east
Cairo without any exits, in
addition to other accessible
ring roads and highways
✓ The project expanded PHD’s Land
Bank by 12.6mn sqm, positioning
PHD as the largest property
developer in Egypt
✓ Lower initial cash outlays
✓ Target new market segments mainly
middle income wallets
✓ Develop large integrated
communities
✓ Act as master developer
✓ Expected to create 300k jobs
✓ Expected to house up to c.150k
inhabitants
Badya Location & Masterplan
Social Assets Recreational Assets Commercial Assets
✓ General Hospital
✓ Local / regional branded
private school
✓ Internationally branded
private school
✓ College
✓ International University
✓ Iconic park
✓ Sports stadium
✓ Desert sports complex
✓ Public library
✓ Heritage / socio-cultural
✓ center
✓ Golf course
✓ Theme park
✓ Water park
✓ Zoo
✓ Concentrated retail (e.g.,
open-air mall)
✓ Super / Hyper market
✓ Retail box park
✓ MICE hotels
✓ Wellness resorts
✓ Nursing homes
✓ Specialty hospitals
✓ Co-working spaces
✓ Office complex / HQs
✓ Art galleries
✓ Marriage halls
Main Components - All Residents’ Needs Will Be Located Within the City Key Attractions
APPENDIX
Badya, West Cairo
Palm Hills Developments | 2019 | Investor Presentation 30
♦ The project will be developed
between 2018-2038 with a total
of 32,319 units (27,687
apartments & 4,632 standalone
units) excluding NUCA’s residential
BUA
♦ The commercial component will
spread over 12% of the land
including: education, office, retail,
and hospitality
♦ The government will make in-kind
contribution of land plus all
required infrastructure to the
boundaries of the project site
alongside road network (currently
under construction)
♦ In May 2018, PHD successfully
launched Badya achieving new
sale of 1,935 units worth of
EGP4.8 bn by end of FY2018.
1 Excluding NUCA’s revenue share
Phase 1A Overview
Cash In Kind BUA
NUCA Revenue Share
▪Residential BUA of 372k sqm
(2,242 units delivered
between years 9-12)
▪Commercial BUA of 50k sqm
(delivered in year 12)
▪ In-kind payment translates to
EGP110/sqm on NPV basis
▪26% of cash revenue
payable over the first 12
years capped at
EGP640/sqm on NPV basis
2018 Sales Figures
Apartments Sold
(Units)
Standalone Units
Sold (Units)
Total Value Sold
1,579
356
EGP4.8 bn
Badya Project Key Facts NUCA Revenue Share Agreement
Land Area 12.6mn sqm
Total Built Up Area 7.4mn sqm
Total Value of Units EGP503 bn1
Select Residential Highlights
Total No. of Units 35,711
BUA 6.4mn sqm
Type of Units Apartments & Villas
Select Commercial Highlights
BUA 985,000 sqm
Hospitality 3 Hotels
Office Space & RetailOffices complex
1 Convenience retail
Education 8 schools
Healthcare1 Hospital
26 Clinics
APPENDIX
Badya, West Cairo
Palm Hills Developments | 2019 | Investor Presentation 31
♦ In January 2017, PHD acquired a
190 feddan plot located in 6th of
October City from the Egyptian
Ministry of Housing
♦ The land plot is strategically
located adjacent to the Company’s
existing developments in West
Cairo including Palm Hills Golf
Views and Golf Extension
♦ The total number of units for The
Crown project stands at 707
standalone units, with sales of
phase one commenced in May
2017
The Crown Project Key Facts Key Attractions
The Crown Project Masterplan
✓ Prime location adjacent to the
Company’s established projects
including Golf Views and Golf
Extension projects
✓ The project will allow PHD to charge
high premiums given the scarcity of
land in that area
Location 6th of October
Sales launch date May 2017
Value of Units EGP9 bn
Land Price 2,440 EGP/sqm
Land Area 798,000 Sqm
BUA 263,120 Sqm
Project Duration 2017 - 2028
Select Residential Highlights
Total No. of Units 972
Type of Units Apartments - Standalone
The Crown Project Location
APPENDIX
The Crown, West Cairo
Palm Hills Developments | 2019 | Investor Presentation
Land Area 769k sqm
Total Built Up Area 575k sqm
Total No. of Units 3,225
Type of Units Villas/Apar.
Value of Units EGP17.4 bn
Project Launch Date 1Q2019
✓ Access to Alexandria, Egypt’s second
largest city, which did not see any
major development for at least the
past 20 years
✓ First mover into Alexandria, granting
PHD access to this underserved
property market
✓ Project is strategically located in
proximity to Al Nozha International
Airport
✓ Alexandria’s maximum real estate
credit terms currently stands at 2/3
years, so PHD offering 5/6 years
will be a major advantage
♦ PHD will be entitled to a revenue share of 65% from the finished units mainly the apartment component,
with the partner holding the remaining 35%. In addition, the partner will receive 10% from the residential
component’s net profit after tax out of the Company’s revenue share. For the unfinished units (standalone
villas), PHD will be entitled to a revenue share of 70%, while the partner will hold the remaining 30%.
♦ Financial indicators are based on G+7, in addition to two underground levels for parking.
♦ The project is expected to offer a number of commercial facilities including a community club and school
♦ In February 2017, PHD
signed a co-development
agreement with a
government agency with
the purpose of co-
developing on revenue
sharing basis 135 feddan
in Alexandria
♦ PHD will be responsible
for all construction,
development,
infrastructure, marketing
and sales activities of the
project
♦ The project’s soft launch
took place on December 7,
2018.
Highlights
Project Master Plan1
1 Master plan is subject to change in the project’s final master plan
32
APPENDIX
Alexandria
Key Attractions
Project Key Facts
Palm Hills Developments | 2019 | Investor Presentation
✓ Lower initial cash outlays
✓ Replenish PHD’s Land Bank and
presence in East Cairo
✓ Develop Large Integrated
Communities
✓ Project is located in vicinity of the
New Capital being developed by
the Egyptian government
✓ Prime location with access to a
number of main highways
Project Key Facts
Land Area 2.1 mn sqm
Total Built Up Area 1.03 mn sqm
Total No. of Units 3,576
Type of UnitsApartments &
villas
Value of Units EGP29.1 bn
Project Launch Date 4Q2016
♦ Government’s Contribution: In-kind contribution of land
♦ Down payment: EGP50 mn were paid upon signing the contractual agreement in March 2015 plus
another EGP50 mn to be paid upon the issuance of relevant ministerial decree
♦ Development: PHD is responsible for the development and management of the project
♦ Revenue sharing: 71.6% of revenue to PHD. NUCA will be entitled to 28.4% in cash, in addition to an in-
kind payment of BUA of 150k sqm
♦ Minimum guarantee: EGP10 bn payable over 13 years to the Government
♦ PHD expects to convert part of the area allocated for villas into apartments, which is expected to
increase revenue by EGP2~3 bn
♦ PHD signed a co-
development agreement
with NUCA in March 2015
♦ SWA Group finalized the
master plan in July 2016
♦ Phase 1 was successfully
launched in November
2016, while Phase 2 was
launched in March 2017
♦ Cumulative New Sales since
launch stood at EGP6 bn as
at end of 2018
Highlights
Key Attractions
APPENDIX
Palm Hills New Cairo, East Cairo
33
Palm Hills Developments | 2019 | Investor Presentation
Project Key Facts
Land Area 434k sqm
Total Built Up Area 494k sqm
Total No. of Units 2,513
Type of Units Apartments
Value of Units EGP9.1 bn
Project Launch Date 4Q2015
✓ PHD’s first co-development project
in East Cairo
✓ Project allows PHD to cater to
middle income bracket
✓ Project replenish PHD’s land bank in
East Cairo
✓ No minimum guarantee required by
partner
♦ Phase 1 was launched during December 2015, with New Sales recording EGP1.2 bn by end of 2016,
equivalent to 774 units
♦ Contractors (UECC & MedCom) commenced construction of Phase 1 during September 2016, which will be
developed over 36 month and will encompass 38 buildings (756 apartments)
♦ Realized strong progression in terms of selling prices reaching EGP12.2k/sqm, compared to a launch
price of EGP6.5k/sqm in Q42015
♦ Phase 2 was successfully launched in April 2017 which encompasses 684 apartments, at a launch price of
EGP11.9k/sqm, with New Sales recording EGP0.5 bn by of FY2017
♦ Co-Development project
with Madinet Nasr for
Housing & Developments
(“MNHD”) spanning 100
feddan in East Cairo in a
prime location
♦ MNHD is entitled to a
revenue share of 36%
♦ PHD is responsible for all
construction, development,
internal infrastructure,
marketing and sales
activities, while MNHD will
be contributing the land
alongside all associated
external infrastructure Highlights
Key Attractions
34
APPENDIX
Capital Gardens, East Cairo
Palm Hills Developments | 2019 | Investor Presentation
Hacienda West
Project Key Facts
Land Area 585k sqm
Total Built Up Area 145k sqm
Total No. of Units 868
Type of UnitsVillas/Chalets/
Cabanas
Value of Units EGP4.8 bn
Project Launch Date 2Q2017
✓ Prime location with a large
beachfront
✓ Access to nearby new highway
connecting to Cairo in a couple of
hours
✓ Replenish PHD’s Land Bank in the
North Coast
✓ No minimum guarantee required by
partner
✓ Branded Hacienda – premium
brand
♦ In February 2016, PHD
signed a Co-Development
agreement with private
land owner in the North
Coast spanning 139.4
feddan with beachfront of
411 sqm
♦ PHD will be responsible
for all construction,
development, internal
infrastructure, marketing
and sales activities, while
the owner will be
contributing the land
Highlights
Project Master Plan Key Attractions
♦ The project is located in Ras El Hekma on the North Coast, 65 km west of Hacienda White 1
♦ PHD will be entitled to a revenue share of 80%, with partner holding the remaining 20%, at a minimum
revenue guarantee of EGP200 mn over 10 years
♦ Phase one was successfully launched in June 2017 and realized New Sales of EGP1.2 bn since launch and
until end of FY2018
35
APPENDIX
Hacienda West, North Coast
Palm Hills Developments | 2019 | Investor PresentationNote: Projects data as at December 31, 2018
Land Size 0.3 mn sqm
Type of Units Twin/Town
Value of Inventory EGP1.7 bn
Number of Units 475
Delivered Units 141
Recognized Revenue EGP1.4 bn
Sales Backlog EGP0.2 bn
Receivables EGP0.7 bn
Starting Delivery Date 2017
Expected Completion of
Construction2019
Living Families -
Woodville, West Cairo
Land Size 0.5 mn sqm
Type of Units Apartments
Value of Inventory EGP3.2 bn
Number of Units 1,304
Delivered Units 771
Recognized Revenue EGP1.2 bn
Sales Backlog EGP0.2 bn
Receivables EGP0.5 bn
Starting Delivery Date 2014
Expected Completion of
Construction2020
Living Families 164
Palm Parks, West Cairo
Land Size 2 mn sqm
Type of Units Villas/Twin/Town
Value of Inventory EGP4.3 bn
Number of Units 688
Delivered Units 498
Recognized Revenue EGP3.2 bn
Sales Backlog EGP0.4 bn
Receivables EGP0.5 bn
Starting Delivery Date 2012
Expected Completion of
Construction2020
Living Families 67
Golf Views, West Cairo
36
APPENDIX
Projects Under Development
Palm Hills Developments | 2019 | Investor Presentation
Land Size 219k sqm
Type of Units Standalone Units
Value of Inventory EGP1.3 bn
Number of Units 237
Delivered Units 31
Recognized Revenue EGP1.04 bn
Sales Backlog EGP0.05 bn
Receivables EGP0.6 bn
Starting Delivery Date 2018
Expected Completion of
Construction2019
Living Families -
Palm Valley, West Cairo
Land Size 1 mn sqm
Type of Units Villas/Twin/Town
Value of Inventory EGP4.3 bn
Number of Units 965
Delivered Units 656
Recognized Revenue EGP3.3 bn
Sales Backlog EGP0.3 bn
Receivables EGP0.9 bn
Starting Delivery Date 2014
Expected Completion of
Construction2019
Living Families 77
Golf Extension, West Cairo Palm Hills Katameya, East Cairo
Land Size 928k sqm
Type of Units Standalone Units
Value of Inventory EGP2.3 bn
Number of Units 516
Delivered Units 435
Recognized Revenue EGP2.1 bn
Sales Backlog EGP0.1 bn
Receivables EGP0.4 bn
Starting Delivery Date 2010
Expected Completion of
Construction2019
Living Families 30
37
APPENDIX
Projects Under Development
Note: Projects data as at December 31, 2018
Palm Hills Developments | 2019 | Investor Presentation
Palm Hills Katameya Extension (Ph2), East Cairo
PHK
VGK
PK2
PK2 Phase 2
Land Size 150k sqm
Type of Units Standalone Units
Value of Inventory EGP1,165 bn
Number of Units 33
Delivered Units 10
Recognized Revenue EGP0.8 bn
Sales Backlog EGP70 mn
Receivables EGP0.2 bn
Starting Delivery Date 2018
Expected Completion of Construction 2020
Living Families -
38
Palm Hills Katameya Extension, East Cairo
Land Size 230k sqm
Type of Units Standalone Units
Value of Inventory EGP807 mn
Number of Units 275
Delivered Units 256
Recognized Revenue EGP784 mn
Sales Backlog EGP19 mn
Receivables EGP70 mn
Starting Delivery Date 2014
Expected Completion of Construction 2019
Living Families 23
APPENDIX
Projects Under Development
Note: Projects data as at December 31, 2018
Palm Hills Developments | 2019 | Investor Presentation
Land Size 472k sqm
Type of Units Standalone & Apartments
Value of Inventory EGP2.1 bn
Number of Units 824
Delivered Units 442
Recognized Revenue EGP1.6 bn
Sales Backlog EGP0.3 bn
Receivables EGP0.4 bn
Starting Delivery Date 2014
Expected Completion of Construction 2021
Living Families 75
Land Size 2,411k sqm
Type of Units Standalone & Apartments
Value of Inventory EGP6.1 bn
Number of Units 2,191
Delivered Units 1,690
Recognized Revenue EGP4.2 bn
Sales Backlog EGP0.4 bn
Receivables EGP1.3 bn
Starting Delivery Date 2010
Expected Completion of Construction 2019
Living Families 665
Hacienda White 2, North Coast Hacienda Bay, North Coast
39
APPENDIX
Projects Under Development
Note: Projects data as at December 31, 2018
Appendix - Financial Statements
Palm Hills Developments | 2019 | Investor Presentation
EGP Millions 4Q2018 4Q2017 % 2018 2017 %
Revenue 1,766,740 1,845,734 (4%) 7,422,756 6,603,539 12%
Cost of Revenue (1,300,562) (1,218,232) 7% (4,835,433) (4,500,248) 7%
Gross Profit 466,179 627,503 (26%) 2,587,323 2,103,291 23%
Gross Profit Margin 26% 34% (8pp) 35% 32% 3pp
General Administrative, Selling and Marketing Expenses (283,288) (218,754) 30% (963,480) (756,284) 27%
EBITDA 182,891 408,749 (55%) 1,623,843 1,347,007 21%
EBITDA Margin 10% 22% (2pp) 22% 20% 2pp
Administrative Depreciation (25,402) (5,402) NA (66,807) (20,476) NA
Operating Profit 157,489 403,347 (61%) 1,557,035 1,326,531 17%
Less:
Finance Cost & Interests 7,671 (50,582) (115%) (200,064)3 (207,738) (4%)
Securitization of Notes Receivables Discounting Charges - - - (114,003) (116,441) (2%)
Interest on Land Purchase Liabilities (59,123) (14,301) NA (249,565) (124,024) NA
Provisions (59) (65,638) NA (12,248) (70,308) (83%)
Add: - - NA
Recoverable Interest on Land Purchase Liabilities - 80,744 NA - 163,568 NA
Interest Income - Amortization of Discount on Notes Receivables 20,131 16,798 20% 80,526 67,191 20%
Gains on investments in fair value through profit or loss 43,137 13,500 220% 88,882 58,571 52%
Interest Income on held-to-maturity investments 2,550 1,422 79% 8,693 6,011 45%
Net Profit Before Income Tax & Minority 171,796 385,289 (55%) 1,159,257 1,103,360 5%
Income Tax Expense 24,338 (45,866) NA (251,517) (162,100) 55%
Deferred Tax (420) (5,587) (92%) (874) (4,790) (82%)
Net Profit After Tax 195,714 333,835 (41%) 906,866 936,471 (3%)
Non-Controlling Interest (24,191) 4,808 NA (95,124) (130,833) (27%)
Net Profit After Tax & Minority Interest 171,523 338,643 (49%) 811,742 805,637 1%
Net Profit After Tax & Minority Interest Margin 10% 18% (8pp) 11% 12% (1pp)
41
APPENDIX
Income Statement Summary
Note : Consolidated financial statements are prepared in accordance with Egyptian Accounting Standards (‘EAS’), can be
downloaded from our Company’s website: www.palmhillsdevelopments.com
1- Finance cost & Interest includes Capital lease interest of EGP115 mn and Finance Cost of EGP84 mn.
Palm Hills Developments | 2019 | Investor Presentation 42
APPENDIX
Balance Sheet Summary
Note : Consolidated financial statements are prepared in accordance with Egyptian Accounting Standards (‘EAS’), can be
downloaded from our Company’s website: www.palmhillsdevelopments.com
EGP Thousand December 31, 2018 December 31, 2017
Long-Term Assets
Investments in Associates 97,447 83,615
Investment Property 769,612 758,690
Notes Receivable - Long Term 13,087,429 11,356,555
Projects Under Construction 106,030 882,473
Advance Payments for Investments Acquisitions 194,598 184,336
Fixed Assets (net) 1,427,791 347,278
Deferred Tax Asset 4,469 5,485
Other Long-Term Assets 1,391 1,391
Employee Stock Options Program (ESOP) - 83,414
Total Long-Term Assets 15,688,768 13,703,236
Current Assets
Works in Process 9,091,530 9,193,761
Held to Maturity Investments 1,750,819 467,935
Cash & Cash Equivalents 955,738 562,030
Notes Receivable - Short Term 4,235,390 3,012,453
Investments at Fair Value 75,867 51,427
Accounts Receivable 1,061,705 883,344
Suppliers - Advance Payments 494,373 486,084
Debtors & Other Debit Balances 984,451 589,211
Due from Related Parties 359,633 251,408
Guaranteed Payments - Joint Arrangements Partners - 50,000
Total Current Assets 19,009,505 15,547,652
Total Assets 34,698,273 29,250,888
Current Liabilities
Banks - Credit Balances 57,736 50,561
Banks – Overdraft 897,807 374,696
Advances from Customers 11,484,809 10,132,168
Completion of Infrastructure Liabilities 95,083 95,083
Provisions 251,706 240,244
EGP Thousand December 31, 2018 December 31, 2017
Current Liabilities (continued)
Current Portion of Land Purchase Liabilities 158,982 102,493
Notes Payable - Short Term 1,586,918 -
Current Portion of Term Loans 1,101,130 1,239,625
Suppliers & Contractors 704,440 979,574
Income Tax Payable 251,569 543,392
Creditors & Other Credit Balances 617,219 162,100
Due to Joint Arrangements Partners 749,683 523,428
Due to related Parties 28,188 174,562
Total Current Liabilities 17,985,273 14,714,542
Working Capital 1,024,234 833,110
Total Investment 16,713,001 14,536,345
Financed as Follows:
Shareholders’ Equity
Issued and Paid-In Capital 6,157,199 4,617,899
Legal Reserve 708,524 682,810
Special Reserve 476,064 476,064
ESOP Re-measurement Reserve - 43,010
Retained Earnings 556,922 76,127
Net Profit for the Period/Year 811,742 805,638
Equity Attributable to Equity Holders of Parent Co. 8,710,451 6,701,549
Non-Controlling Interest 505,090 538,436
Total Shareholders' Equity 9,215,541 7,239,985
Long Term Liabilities
Land Purchase Liabilities 298,280 335,844
Notes Payable - Long Term 1,660,457 1,912,929
Other Long-Term Liabilities - Residents’ Association 1,671,536 1,083,208
Loans 2,657,712 3,228,805
Due to Joint Arrangements Partners 1,209,477 735,573
Total Long-Term Liabilities 7,497,460 7,296,360
Total Equity & Long Term Liabilities 16,713,001 14,536,345
Palm Hills Developments | 2019 | Investor Presentation
EGP Millions 2018 2017
Net Profit for the Period (Before Income Tax & Non-Controlling Interest) 1,159,257 1,103,360
Administrative Depreciation 85,077 36,820
Provision Formed 12,248 70,308
Securitization of Receivables Interest 114,003 116,441
Interest on Land Purchase Liabilities 249,565 124,024
Finance Costs & Interest 200,064 207,738
Gain on Disposal of Property & Equipment (1,039) (1,538)
Share of Profit/Loss of Associates (11,852) (4,390)
Gains on Investments in Fair Value through Profit or Loss (8,693) (6,011)
Interest Income on Held to Maturity Investments (88,882) (58,571)
Recoverable Interest on Land Purchase liabilities - (163,568)
Interest Income-Amortization of Discount on Notes Receivables (80,526) (67,191)
Operating Profit Before Changes in Working Capital Items 1,629,220 1,357,423
Changes in Working Capital Items
Change in Work in Process (204,574) (2,090,446)
Change in Notes Receivables (2,873,286) (3,706,248)
Change in Investments in Fair Value through Profit or Loss (1,282,884) (314,607)
Change in Held to maturity Investments (24,440) 7,044
Change in Accounts Receivable (178,362) (126,287)
Change in Suppliers - Advance Payments (8,289) 2,981
Change in Debtors & Other Debit Balances (395,240) (370,734)
Change in Due from Related Parties (108,225) (7,283)
Change in Guaranteed Payments - Joint Arrangements 50,000 (10,000)
Change in Advances from Customers 1,352,641 2,387,413
Change in Investments purchase liabilities - (44,257)
Provisions (786) 549
Change in Due to Related Parties (68,429) (34,717)
Changes in Notes Payables (154,744) 1,605,095
Change in Suppliers & Contractors 161,047 94,927
Income Tax Paid (162,048) (126,629)
Change in Creditors and Other Credit Balances 93,791 1,172
Change in Other Long Term - Residents’ Association 588,327 346,764
Due to Joint Arrangements Partners 1,049,025 749,710
Net Cash (Used In) Operating Activities (537,252) (278,131)
EGP Millions 2018 2017
Cash Flows from Investing Activities
Payments for Purchase of Fixed Assets (52,297) (38,329)
Proceeds from Sale of Fixed Assets 1,250 1,560
Investments in sister companies (1,979) -
Payment for Investments Acquisition (10,262) -
Proceeds from Payments for Projects Under Construction (9,581) (24,812)
Proceeds from real estate investments (12,673) 128,066
Cash Flows from Investing Activities (12,032) 131,066
Cash Flows from Financing Activities
Proceeds from Capital Increase 1,539,299 -
Banks - Credit Balances 7,175 8,384
Banks - Overdraft 523,111 295,285
Adjustments to Retained Earnings (299,129) (288,521)
Proceeds from ESOP 40,404 9,390
Non-Controlling Interest - Dividends (128,471) (4,548)
Deferred Tax 141 28
Special Reserve - (48,149)
Proceeds from Loans 566,192 559,832
Repayment of Loans (1,015,730) (306,944)
Finance Costs & Interests (314,067) (324,179)
Net Cash Provided by Financing Activities 918,928 (99,422)
Net Increase in Cash & Cash Equivalents during the Period 393,707 (246,486)
Cash & Cash Equivalents at Beginning of the Period 562,030 808,517
Cash & Cash Equivalents as at 31 December 2018 955,738 562,030
43
APPENDIX
Cash Flow Statement Summary
Note : Consolidated financial statements are prepared in accordance with Egyptian Accounting Standards (‘EAS’), can be
downloaded from our Company’s website: www.palmhillsdevelopments.com
Appendix - Corporate Structure
Palm Hills Developments | 2019 | Investor Presentation
Rakeen Egypt for
Real Estate
Investments (99.95%)
Nile Palm
Al-Naeem for Real Estate
Development (51%)
Middle East Co.
for Real Estate &
Touristic Investment
(87.50%)
Gawda for Trade
Services (100%)
Al Naeem for Hotels &
Touristic Villages (60%)
Gamsha for Touristic
Development (59%)
Royal Gardens for
Real Estate
Investment (51%)
Hacienda White 1
Bamboo Extension CasaPalm Parks
Palm October for
Hotels (99.75%)
Palm Gamsha
Hotels (98%)
Sixth of October for
Hotels & Touristic
Services Co.(79.95%)
Hotels & Touristic
Floating Restaurants
Co. (99.99%)
Palm North Coast
Hotels (98%)
Ismailia for
Toruism Co. (55.12%)
El Nema for Toursim &
Real Estate Co. (49.99%)
Palm Hills Development
SAECascadeBotanica Golden Palm Golf ViewsBamboo Golf Extension
Palm Hills
KatameyaWoodville
New Cairo for Real Estate
Development (99.99%)
Macor for Securities
Investment Co. (60%)
Palm Hills for
Hospitality (98%)
Palm Hills Middle
East Co. for Real Estate
Investment (99.99%)
Saudi Urban
Development Co. (51%)
New East Cairo for
Real Estate
Development (99.99%)
The Village Village Gardens Katameya Hacienda Bay Palm Valley
Projects Tier 1 Subsidiaries Tier 2 Subsidiaries
Palm Hills Katameya
ExtensionVillage Gate
Village Avenue
Hacienda White 2Palm Hills for Education (71%)Palm Clubs (99%)
Palm Alexandria for Real
Estate (99%)
45
APPENDIX
Corporate Structure - Subsidiaries & Projects
Palm Hills Developments | 2019 | Investor Presentation
IR Team
Mamdouh Abdelwahab
Investor Relations & Investments A. Vice President
Radwa Abu El Naga
Investor Relations Manager
Contact Details
Direct: +202 35351200
Extension: 1230 / 1504
Fax: +202 3535 1208/9
Headquarters
Smart Village, A4 - B84
Kilo 28, Cairo/Alexandria Desert Road
Abou Rawash, Egypt
Download our IR App
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46
APPENDIX
Investor Relations Contacts
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