Orascom Development Egypt (ODE) has announced in May 2021 a strong demonstration of its financial results in the first quarter (Q1) of 2021. The company has seen an annual revenues growth by 61.5% to EGP 1.46bn.
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Orascom Development Egypt (ODE) is a leading developer of fully integrated destinations in Egypt. It involves several development fields including private villas, apartments and hotels. It also includes leisure facilities such as golf courses, marinas, and other supporting infrastructure such as schools, universities and hospitals. Orascom Development Egypt currently owns a land back of over 45.7 million sqm and an extensive hotel profile.
The company’s revenue for the quarter is compared to the EGP 903.8m reported in Q1 of 2020. Meanwhile, Orascom Development Egypt reported a net profit growth by 377.1%, translating to EGP 438.5m.
The boost in revenues was the result of an acceleration in ODE construction activities across all projects, with real estate revenues reaching EGP 1.2bn, which is an annual increase of 156.2% compared to Q1 of 2020.
Gross profits increased by 152.9% to EGP 574.9m in Q1 of 2021, compared to Q1 of 2020 which was EGP 227.3m , with a gross margin of 39.4%. Operating earnings before interest, taxes, depreciation, and amortization was up 171.8% to EGP 590.9m in Q1 of 2021, with a 40.5% increase margin compared to EGP 217.4m in the same quarter of the year before.
At the same time, earnings before interest, taxes, depreciation, and amortization also increased by 174.6% to EGP 694.0m, compared to EGP 252.7m in Q1 of 2020.
Annual revenues from real estate surged 156%, and decreased 15% quarter-on-quarter to EGP1.18bn. These revenues were supported by an accelerated pace of construction across all destinations.
Revenues from the town management segment were calculated at EGP184m, indicating an annual rise of 3% , and Quarter on quarter drop of 11% . As for presales, the company announced that net real estate sales increased 37% year on year and 14% quarter on quarte to EGP 2.1bn, beating the company’s forecast of EGP 1.7bn. The company sold 355 real estate units during the quarter, which is over the expected by 48%.
The primary contributions for new sales came from: El Gouna, which represents 48%; O West which represents 37%; and Makadi Heights, which represents 15%.
Net debt as of March 2021 dropped to EGP1bn, versus EGP1.5bn in December 2020. This was boosted by strong operating cash flows of EGP396m during the first quarter of 2021. Additionally, cancellation rates remained low at 4% of gross sales and delinquencies dropped to 3% vs 4% in 2020.
For the rest of the year, the company is aiming to continue accelerating their real estate construction to meet contractual dates, ultimately increasing the real estate segment’s revenues.
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