Orascom Development Holding AG
DGAP-Adhoc: Orascom Development Holding AG: 1H 2013 Earnings Release
Orascom Development Holding AG / Key word(s): Half Year Results 27.08.2013 07:00 Release of an ad hoc announcement pursuant to Art. 53 KR --------------------------------------------------------------------------- Press Release 1H 2013 results: net loss but cost-savings and monetization program on track 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 Hotels 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. Outlook 2013 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 Relations section. 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: Till Leisner Head of Group Controlling & Investor Relations Tel: +41 41 874 88 07 Email: ir@orascomdh.com or media@orascomdh.com Contact for Investors: Sara El Gawahergy Investor Relations Manager Tel: +2 01 205 20 52 18 Email: ir@orascomdh.com Disclaimer & Cautionary Statement The information contained in this e-mail, its attachment and in any link to our website indicated herein is not for use within any country or jurisdiction or by any persons where such use would constitute a violation of law. If this applies to you, you are not authorized to access or use any such information. Certain statements in this e-mail and the attached news release may be forward-looking statements, including, but not limited to, statements that are predications of or indicate future events, trends, plans or objectives. Forward-looking statements include statements regarding our targeted profit improvement, return on equity targets, expense reductions, pricing conditions, dividend policy and underwriting claims improvements. Undue reliance should not be placed on such statements because, by their nature, they are subject to known and unknown risks and uncertainties and can be affected by other factors that could cause actual results and Orascom Development Holding AG's plans and objectives to differ materially from those expressed or implied in the forward looking statements (or from past results). Factors such as (i) general economic conditions and competitive factors, particularly in our key markets; (ii) performance of financial markets; (iii) levels of interest rates and currency exchange rates; and (vii) changes in laws and regulations and in the policies of regulators may have a direct bearing on Orascom Development Holding AG's results of operations and on whether Orascom Development Holding AG will achieve its targets. Orascom Development Holding AG undertakes no obligation to publicly update or revise any of these forward-looking statements, whether to reflect new information, future events or circumstances or otherwise. It should further be noted, that past performance is not a guide to future performance. Please also note that interim results are not necessarily indicative of the full-year results. Persons requiring advice should consult an independent adviser. 27.08.2013 News transmitted by EQS Schweiz AG. The issuer is responsible for the contents of the release. EquityStory publishes regulatory releases, media releases on the capital market and press releases. The EquityStory Group distributes authentic and real-time financial news for over 1'300 listed companies. The Swiss news archive can be found at www.equitystory.ch/news --------------------------------------------------------------------------- Language: English Company: Orascom Development Holding AG Gotthardstraße 12 6460 Altdorf Switzerland Phone: +41 41 874 17 17 Fax: +41 41 874 17 07 E-mail: ir@orascomdh.com Internet: www.orascomdh.com ISIN: CH0038285679 Valor: A0NJ37 Listed: SIX End of Announcement EQS Group News-Service ---------------------------------------------------------------------------