Orascom Development Holding AG / Key word(s): Half Year Results
Release of an ad hoc announcement pursuant to Art. 53 KR
1H 2013 results: net loss but cost-savings and monetization program on
The difficult situation in Egypt continued to impact Orascom Development's
1H 2013 results. Revenues declined by 10.3% to CHF 118.3 million while the
net loss of CHF 48.0 million was mainly driven by a weaker Real Estate and
Construction result, FX-losses and losses related to Andermatt Swiss Alps.
On the positive side, the hotel performance continued to improve and the
Group succeeded to further execute on its monetization schedule. The
recently announced cost-savings program (CHF 50 million until 2014) is on
track and the deconsolidation of Andermatt Swiss Alps has significantly
strengthened the Group's balance sheet.
Altdorf/Cairo, 27 August 2013 - The ongoing political unrest in Egypt
continues to have a significant impact on Orascom Development Holding AG's
(Orascom Development) results. For the first half year of 2013 the Group
reported a 10.3% decrease in consolidated revenues to CHF 118.3 million (1H
2012: CHF 131.9 million) as a result of fewer real estate units being
delivered in Egypt and Oman. Combined with higher cost of sales the gross
profit margin decreased from 9.3% a year ago to 4.3%.
The net loss after minorities of CHF 48.0 million is attributable to a
weaker real estate and construction result, foreign exchange losses from
USD-denominated loans and losses related to Andermatt Swiss Alps.
The Group successfully closed the share sale of Madinet Nasr for Housing
and Development, an EGX-listed company. The proceeds of CHF 32.2 million
were partly used to settle outstanding debt. The recently announced
cost-savings program, with a total volume of CHF 50 million until 2014, is
fully on track, with CHF 13 million of annualized savings to be recognized
in FY 2014.
The deconsolidation of Andermatt Swiss Alps strengthened the Group's
Balance sheet decreasing net debt by 15.6% to CHF 424.1 million and lifting
the equity ratio from 46.9% to 50.4%.
Key Figures (in CHF million) 1H 2012 1H 2013 Delta
Total revenues 131.9 118.3 -10.3%
Gross Profit 12.2 5.1 -58.6%
Gross Profit-Margin (%) 9.3% 4.3%
Net income / (loss) after minorities (27.3) (48.0)
Operating cash flow after interest/taxes (3.4) (40.6)
Total assets ¹ 2,082.7 1,795.6 -13.8%
Equity ratio (%) ¹ 46.9% 50.4%
Net debt ¹ 502.2 424.1 -15.6%
EBITDA (2.5) (15.7)
¹ For 2012 as per December 31, 2012
Main Business Segments
Hotel revenues in the first half year of 2013 increased by 4.3% from CHF
69.0 million to CHF 72.0 million, equivalent to 60.8% of Group revenues.
The operating result (EBITDA) reached CHF 14.9 million (20.7% margin),
negatively impacted by a foreign exchange loss of CHF 3.9 million.
Occupancy rates went up to 59% (1H 2012: 54%) as operations in Egypt and
Jordan witnessed higher demand, while UAE maintained about the same high
level of last year. TRevPAR (Total Revenues per Available Room) increased
to CHF 60 (1H 2012: CHF 57). At the end of the reporting period, Orascom
Development operated 6,696 hotel rooms due to smaller additions in Oman.
Real Estate and Construction
Revenues in the real estate and construction segment amounted to CHF 22.3
million, a decrease of 40.3% compared to the previous year (1H 2012: CHF
37.3 million) and equivalent to 18.8% of Group revenues. The decrease is
mainly a result of fewer units being delivered in Egypt and Oman.
Accordingly the segment's EBITDA declined to -CHF 8.1 million impacted by
higher costs of sales and overhead construction costs in Egypt and Oman.
Contracted real estate sales (excluding Andermatt) in the first half of
2013 amounted to CHF 31.0 million compared to CHF 27.4 million a year ago.
In total, 219 units were sold (1H 2012: 298 units).
Changes in the Board of Directors
Effective October 1, 2013 Nicholas Cournoyer has decided to step down from
the board of Orascom Development due to personal reasons. The board of
directors likes to thank Nicholas Cournoyer for his valuable contributions
during the last years and wishes him all the best for his future career.
Business performance until July 2013
During the first seven months of this year hotel revenues continued to
improve when compared to the same period of last year. However and given
the most recent political developments in Egypt the visibility regarding
hotel performance for the rest of the year remains low. Until the end of
July 2013 the value of sold real estate units was about 26% higher than in
the comparable period of last year.
Hotel openings on track
As communicated earlier, the new hotel The Chedi Andermatt in Switzerland
(89 rooms), the Rotana hotel in Oman (399 rooms) and the hotel in Makadi
(299 rooms) will open by the end of this year.
Political and economical uncertainty
Egypt's economy is still suffering from a severe downturn and the
government is facing multiple challenges as to how to restore growth,
market and investor confidence. Political and institutional uncertainty, a
perception of rising insecurity and unrest continue to negatively affect
the economy and especially the tourism industry, our major sector of
operation. Increased travel warnings and tour operators' cancelations
affect our occupancy rates in Egypt. Despite of the current events and
instability, the Group still remains committed with its earlier
communicated strategy of cost savings and monetization. We will be cautious
yet prudent with our spending strategy, tightening capital expenditure and
focusing on our core destinations in Egypt, Oman and Montenegro.
Financial statements and presentation
The associated financial statements and presentation can be found on
Orascom Developments' website www.orascomdh.com under the Investor
Telephone conference today at 2:00 pm CET
A telephone conference for analysts and investors will be held in English
today at 2:00 pm CET. Chairman Samih Sawiris, CEO Gerhard Niesslein and CFO
Eskandar Tooma will present 1H 2013 results and will be available to answer
questions. A registration is not required. Dial-in details are as follows:
- Password: 912 4748
- International: +44 1452 555 566
- Switzerland Toll Free: 0800 828 006
- Egypt Toll Free: 0800 000 0318
- UK Toll Free: 0800 694 0257
- US Toll Free: 1866 966 9439
A replay of the conference call will be available for one week with the
following dial in details:
- Access Code: 912 4748
- International Replay: +44 1452 550 000
- UK Local Call Replay: 0845 245 52 05
- USA Toll Free Replay: 1866 247 42 22
About Orascom Development Holding AG
Orascom Development is a leading developer of fully integrated destinations
that include hotels, private villas and apartments, leisure facilities such
as golf courses, marinas and supporting infrastructure. Orascom
Development's diversified portfolio of destinations is spread over nine
jurisdictions (Egypt, UAE, Jordan, Oman, Switzerland, Morocco, Montenegro,
United Kingdom and Romania). The Group currently operates six destinations;
three in Egypt El Gouna, Taba Heights and Haram City, The Cove in United
Arab Emirates and Jebel Sifah and Salalah Beach in Oman. Orascom
Development has a dual listing, with a primary listing on the SIX Swiss
Exchange and a secondary listing on the EGX Egyptian Exchange.
Contact for Investors and Media:
Head of Group Controlling & Investor Relations
Tel: +41 41 874 88 07
Email: firstname.lastname@example.org or email@example.com
Contact for Investors:
Sara El Gawahergy
Investor Relations Manager
Tel: +2 01 205 20 52 18
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Company: Orascom Development Holding AG
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