Home Blog Page 72

GlobalData Reveals Top M&A Legal and Financial Advisers in Construction Sector for H1 2023

By
Sahfy Sahfy
-

Hogan Lovells and Kirkland & Ellis were the top mergers and acquisitions (M&A) legal advisers in the construction sector during the first half (H1) of 2023 by value and volume, respectively, according to the latest legal advisers league table by GlobalData, a leading data and analytics company.

An analysis of GlobalData’s Financial Deals Database reveals that Hogan Lovells achieved its leading position in terms of value by advising on $28.4 billion worth of deals. Meanwhile, Kirkland & Ellis led in terms of volume by advising on a total of 11 deals.

Aurojyoti Bose, Lead Analyst at GlobalData, comments: “Hogan Lovells registered 9.2% growth in total value of deals in H1 2023 compared to 2022. Hogan Lovells went ahead from occupying the 10th position by value in H1 2022 to top the chart by this metric in H1 2023. It was also among the only two advisers with more than $25 billion in total deal value in H1 2023. Meanwhile, Kirkland & Ellis was among the only two advisers with double-digit deal volume in H1 2023.”

CMS occupied the second position in terms of volume with 11 deals, followed by White & Case with eight deals, AZB & Partners with eight deals, and Paul, Weiss, Rifkind, Wharton & Garrison with six deals.

Meanwhile, Quinn Emanuel Urquhart & SullivanLLP occupied the second position in terms of value, by advising on $27 billion worth of deals, followed by  Latham & Watkins with $18.5 billion, Cravath Swaine & Moore with $17.2 billion, and Morrison & Foerster with $16.4 billion.

Financial Advisers

JP Morgan, PwC top M&A financial advisers by value, volume in construction sector in H1 2023

JP Morgan and PwC were the top mergers and acquisitions (M&A) financial advisers in the construction sector during the first half (H1) of 2023 by value and volume, respectively, according to the latest financial advisers league table by GlobalData, a leading data and analytics company.

An analysis of GlobalData’s Financial Deals Database reveals that JP Morgan achieved its leading position in terms of value by advising on $33.4 billion worth of deals. Meanwhile, PwC led in terms of volume by advising on a total of nine deals.

Aurojyoti Bose, Lead Analyst at GlobalData, comments: “JP Morgan was the top adviser in value in H1 2022 and was also able to retain its leadership position by this metric in H1 2023. Moreover, JP Morgan left behind its peers by a significant margin in terms of value as it was the only adviser to surpass $30 billion in total deal value during H1 2023. The firm advised on four billion-dollar deals* in, which also included two mega deals valued more than $10 billion.

“Meanwhile, PwC witnessed its ranking by volume improve from fifth position in H1 2022 to the top position by this metric in H1 2023.”

Citi occupied the second position in terms of value, by advising on $19.3 billion worth of deals, followed by Wells Fargo with $18.2 billion, Bank of America with $16.4 billion and Goldman Sachs with $16.2 billion.

Meanwhile, Rothschild & Co occupied the second position in terms of volume with eight deals, followed by JP

Ogram Expands into Greece

By
Sahfy Sahfy
-

Ogram, the on-demand digital staffing platform, announced today its first international expansion into Greece. After successfully servicing 1,000+ clients with $8M+ paid out to qualified flexible workers across the UAE, the company is now bringing its operations to the vibrant Greek market.

“Ogram is the perfect fit for Greece because of a thriving hospitality sector that is highly dependent on flexible workers,” said Georgios Kalafatis, General Manager of Ogram Greece. “And yet, one of the biggest problems they face is finding staff, largely due to an over-dependence on the informal economy. it`s offer the solution.”

Ogram’s platform covers everything from vetting to matching, deployment, attendance, and payments. It also includes a first-of-its-kind integration with Ergani (Social Security), which allows businesses to comply with Greek labor laws.

“By streamlining the process to fulfill shifts and match gig workers with jobs, we signed up 5,000 workers and registered over 200 clients within the first weeks of our launch,” said Kalafatis.

Greece is the first step in a wider expansion plan for Ogram. The company is planning to enter other new markets with a focus on regions with a strong hospitality sector, a high dependence on flexible workers, and a competitive average hourly wage.

“The Greek market will serve as a gateway into the rest of Europe, as Ogram embarks on its EMEA expansion plan,” said Shafiq Khartabil, Co-founder and CEO of Ogram. “Greece has long been an adopter of flexible work in hospitality, and is now eager to make it more formal and efficient through our technology-enabled platform.”

Ogram is calling it ‘The New Workforce’ in reference to a new generation of gig workers that have the tools and autonomy to create their own flexible work schedules. For businesses and individuals, Ogram’s seamless digital platform makes flexible staffing more effective and simple.

Stay tuned for more updates from Ogram.

HC Securities and Investments remarked on the central bank & fixation of the interest rate

By
Sahfy Sahfy
-


In its 22 June meeting, the Monetary Policy Committee (MPC) of the Central Bank of Egypt (CBE) decided to keep the benchmark overnight deposit and lending rates unchanged at 18.25% and 19.25%, respectively, for the second consecutive time, after it raised it by 200 bps on 30March, which is the total rate hike y-t-d, and 800 bps in 2022. Egypt’s annual headline inflation
accelerated for the second consecutive month to a record of 35.7% y-o-y in June from its
previous record of 32.8% y-o-y in May, according to the Central Agency for Public Mobilization
and Statistics (CAPMAS) data. Monthly prices rose 2.08% m-o-m in June compared to 2.72%m-
o-m in the previous month. On the global front, the US Federal Reserve raised interest rates on
Wednesday by 25 bps to a range of 5.25-5.30%, a total of 100 bps y-t-d and 425 bps in 2022.
Based on Egypt’s current economic situation, we present below our expectations for the likely
outcome of the MPC meeting.

Heba Mounir Economist and financials analyst for HC Securities and Investments stated: “We
expect Egypt’s inflation to continue rising by 2.0% m-o-m and record 36.6% y-o-y for July 2023
as the supply shortages, caused by the curbing of importation and lack of USD availability,
continue to lead to inflation spikes. The curbing of importation, along with an improvement in
tourism numbers, has led Egypt’s overall balance of payment (BoP) in 1Q22/23 and 2Q22/23 to
record surpluses of USD523m and USD75.6m, respectively; however, it reversed into a deficit of
USD317m in 3Q22/23 due to c17% q-o-q lower exports impacted by the drop in natural gas and
petroleum products prices and a c46% q-o-q drop in the services balance surplus. On a more
positive note, the Egyptian Cabinet announced selling assets worth USD1.65bn in July (paid in
FX), and the New Urban Communities Authority (NUCA) sold land to foreigners worth USD2bn
in 1H23. Also, net international reserves (NIR) increased by 4.29% y-o-y and 0.42% m-o-m up to
USD34.8bn in June, and deposits not included in the official reserves increased by c19% m-o-m
and 4.96x y-o-y to USD4.37bn in June. As a result, Egypt’s 1-year CDS retreated to 867 from
1,221 in the previous month.
The USD shortage has led Egypt’s banking sector net foreign liabilities (NFL), including the CBE,
to widen by 1.2% m-o-m and c48% y-o-y to USD24.4bn in May 2023, and the two largest public
banks, Banque Misr and the National Bank of Egypt (NBE) started issuing two types of USD
certificates of deposits (CDs), including 3-year CDs at 7% annual interest and 3-year CDs at 9%,
with a cumulative EGP return paid in advance, to improve the FX liquidity. If the Egyptian
government accelerates its partial asset sale program and the USD CDs attract enough
depositors, this should ease the USD shortage. Regarding the carry trade, despite the 12M T-
bills rates increasing 5.19 pp y-t-d to 24.095%, we estimate that it offers a real negative yield of
6.41%, as evidenced by a net foreign portfolio investments outflow of USD3.43bn in 9M22/23.
This suggests that an interest rate hike to attract portfolio inflows is unlikely in the upcoming
MPC meeting until Egypt sorts out its USD liquidity shortage, which led inflation to soar and
widened the Egypt-US inflation differential to 32.0% in 3Q23 from 29.2% in 2Q23. The high-

interest rate environment has also led to an inverted yield curve. Accordingly, and based on
Egypt’s current economic situation, we believe the MPC committee will likely maintain interest
rates unchanged at its 3 August meeting.

The UAE’s real estate sector remains strong in the first half of 2023, despite some signs of moderation, says CBRE

By
Sahfy Sahfy
-

 

Looking at the UAE’s office sector figures, rental performance in Abu Dhabi’s occupier market showed substantial improvement with average Prime, Grade A and Grade B rents recording growth rates of 11.0%, 5.7%, and 7.8% respectively in the year to Q2 2023. Given the scarcity of available supply and the lack of upcoming new stock, we expect to see strong performance continue in the second half of 2023. In Dubai, the total number of new Ejari (lease) registrations in Q1 reached 20,953, up 58.5% from the previous year. The average occupancy rate reached 92.7% as of Q2 2023, up from 84.8% a year earlier on the back of increased demand and limited availability of quality supply. These elevated occupancy rates continue to drive the increase in average rents in Dubai’s office market, where in Q2 2023, average Prime, Grade A, Grade B, and Grade C rents have grown by 17.2%, 11.0%, 16.4%, and 30.0%, respectively. Given the lack of available quality stock and the very limited amount of imminent future supply and strong pre-leasing activity, we expect rents to continue their upward trajectory throughout the remainder of 2023.

 

In Abu Dhabi’s residential market, a total of 2,487 sales transactions were recorded in the second quarter of 2023, marking a growth of 101.1% compared to a year earlier. Compared to Q2 2022, average apartment and villa prices in the UAE capital registered year-on-year increases of 0.9% and 1.7%, respectively. In Abu Dhabi’s rental market, average apartment rents marginally increased by 0.1%, and average villa rents grew by 1.0%. In terms of supply, mid-way through the year, 1,265 units have been completed in Abu Dhabi, where 65.8% of this supply has been delivered in Al Raha Beach and Najmat Abu Dhabi. A further 4,538 units are expected to be completed over the last two quarters of the year, with 49.0% of this upcoming stock scheduled to be delivered in Al Maryah Island.

 

In Dubai, a total of 9,876 residential transactions were registered in June 2023, marking an increase of 18.8% compared to the year prior. Over this period, while off-plan market sales increased by 44.9%,  secondary market sales marginally dropped by 0.5%. Despite the recent marginal drop-off in secondary market sales, activity levels in Dubai’s residential market remained robust in the year’s first two quarters, where in the year to date to June 2023, the total transactions volume reached 57,738. This is the highest total on record over this period and marks an increase of 43.2% compared to the same period a year earlier. Average prices in Dubai increased by 16.9% in the year to June 2023, with average apartment prices increasing by 17.2% and average villa prices by 15.1%. Despite that the average apartment sales rates are still 13.1% below the record highs of 2014, average villa prices currently sit at 5.5% above this peak. That being said, a number of neighbourhoods have long outperformed their 2014 levels. The rate of rental growth continued to moderate for the fifth consecutive month in Dubai, with rents increasing by 22.8% in the year to June 2023, down from 24.2% in May 2023. Over this period, average apartment rents increased by 22.7%, and average villa rents increased by 23.1%. On the supply front, a total of 16,499 units have been completed and delivered in the year’s first two quarters, where new stock in Downtown Dubai, Dubai Creek Harbour, and Business Bay accounted for 44.6% of this recent supply. By the end of this year, an additional 45,380 units are expected to be completed, with 39.6% of this upcoming supply being developed in Meydan One, Business Bay, and District Seven. Moving forward, we expect that rental rates will continue to moderate. This is due to a reduction in asking rents in a number of key residential areas, particularly in the apartment segment of the market, where rents in several prime communities are now heading towards a single-digit growth.

 

Looking at the hospitality sector, the average occupancy rate in the UAE rose by 4.1 percentage points year-on-year, in the year to date to June 2023. Over the same period, ADRs dropped by 1.9%, however average RevPARs saw an increase of 3.6%. Despite this year-on-year moderation in ADR figures, the average ADRs across the UAE have surpassed the 2019 benchmark by 16.4%, given the elevated ADR levels in Sharjah, Dubai, Abu Dhabi, and Fujairah, which have recorded increases of 20.1%, 15.2%, 12.8%, and 8.1%, respectively. As a result, these cities’ RevPARs have outperformed their 2019 levels by 22.4%, 19.7%, 10.1%, and 22.0%, respectively. Average occupancy rates across the majority of locations within the UAE have topped their 2019 levels. Nonetheless, Abu Dhabi is the only city that is still below its pre-pandemic benchmark by 1.7 percentage points. Currently, the UAE is also benefiting from the reopening of the European tourism market. Given the UAE’s hub status, tourists are both deciding and being induced into breaking-up their trips to the continent, which is helping drive demand and profitability in what is usually low season. Over the remainder of the year, we will likely see continued growth in the sector’s KPIs on the back of several key upcoming events, including but not limited to the Abu Dhabi F1 Grand Prix, the COP-28 summit and the gradual return of key source markets, which have only recently been able to freely travel post COVID.

 

In the retail sector, strong levels of take-up continue to be seen in Abu Dhabi in the second quarter of 2023, where the total number of retail rental contracts registered reached 7,494, up by 7.4% compared to the year prior. Over this period, new registrations increased by 1.9%, and renewed registrations increased by 10.2%. In Dubai’s retail market, a total of 17,463 rental contracts were registered in Q2 2023, marking a growth rate of 1.3% compared to the year prior. Over this period, the number of new registrations dropped by 15.3%, whereas renewals grew by 11.9%. In both cities, the trends have been relatively uniform, where demand is highest for prime retail spaces or for retail spaces which have desirable catchment areas and a range of destination drivers. With both markets lacking the availability of such units, we are seeing remerchandising or the introduction of new destination drivers to attract and cater to such occupier requirements. Given these high levels of demand and very limited levels of availability in prime and core assets, we are seeing strong rates of rental growth in both Abu Dhabi and Dubai. As at Q2 2023, average retail rents in Dubai reached AED 472 per square foot, a 38.0% increase from a year earlier. Over the same period, lease rates in Abu Dhabi have grown by 16.9% reaching an average of AED 2,075 per square metre.

 

The UAE’s industrial and logistics sector has seen relatively strong levels of activity over the course of the second quarter of 2023. In the year to Q2 2023, the total number of rental registrations in Abu Dhabi’s industrial and logistics market grew by 18.8%. Over this period, new registrations increased by 8.2%, and renewed contracts registered grew by 26.2%. In Dubai, a total of 2,248 rental transactions were registered in the second quarter of 2023, based on data from the Dubai Land Department, increasing by 3.6% compared to the year prior. Over this period, new registrations considerably dropped by 24.9%, whereas renewals grew by 22.5%. On the back of strong demand, in the year to Q2 2023, average rental rates in Abu Dhabi and Dubai increased by 6.4% and 19.0%, respectively. The scarcity of available quality stock resulting from the lack of new developments will continue to drive rental growth over the second half of 2023, albeit we expect that growth rates will now begin to moderate on average. In Dubai, developers are highly interested in building stock on-shore. That being said, the availability of appropriate infrastructure to do so is the largest inhibitor. In Abu Dhabi, on the other hand, both infrastructure and lands are available for such developments; however, that is not currently matched by developer demand.

 

Taimur Khan, Head of Research – MENA at CBRE in Dubai, comments: “Performance in the UAE’s real estate sector remained strong in the first half of 2023, however we have started seeing moderation in parts. With the global macroeconomic optimism returning slowly, the UAE’s growth prospects remain relatively positive. That being said, this solid outlook is contingent on how the rising interest rates, elevated housing costs (particularly in Dubai) and the weakening US Dollar will impact the country’s economy. Over the remainder of the year, the real estate sector will likely maintain its considerably strong performance and activity levels. Nonetheless, we expect that growth rates will moderate further in a number of segments, given the prevailing market fundamentals.”

REVIVING HEALTH AND HERITAGE: ‘AL ISLAMI FOODS’ DELIVERS MEAT WITH NO ADDED HORMONES FOR GENERATIONS TO COME

By
Sahfy Sahfy
-

As consumers increasingly prioritise their well-being, the demand for natural meat has gained significant traction. Al Islami Foods, renowned for its commitment to delivering premium culinary experiences, proudly offers meat with No added Hormones.

Discover why choosing traditionally produced meat with no added hormones goes beyond health considerations and how discerning families can indulge in premium food and enhance their lives by consuming meat as it should be.

When it comes to food with No added Hormones, what makes Al Islami’s ‘Real Halal’ meat special? Here’s why it is the right choice for families:

  1. Animal Welfare: In a conventional market setting, animals are supplemented with hormones to help weight gain. Consequently, animals fed with unnatural additives are more likely to develop a disease or illness, which can then be passed on to individuals. Meat with No added Hormones ensures the safety of folks while allowing animals to develop in harmony with nature rather than against it.
  2. Healthier & Tastier: Hormones play a huge role in the normal functioning of humans. They control heart rate, sleep cycles, metabolism, appetite, growth and development, mood, stress, body temperatures and more. Meat with No added Hormones keeps the body’s vital equilibrium undisturbed. In addition to being the healthier option, hormone-free meat is generally tastier than its hormone-laden counterpart. The brand provides grass-fed meat that develops lean, tasty muscle promoting a natural and wholesome approach to nourishing the body.
  3. Upholding Islamic Principles: Al Islami embodies the essence of Halal in every aspect of our brand. The unwavering dedication to treating animals with respect, free from the harmful influence of chemicals, upholding Halal requirements, aligning with esteemed values and dietary guidelines of Islam, and offering consumers choices that honour religious beliefs.
  4. Preserving Tradition: Al Islami Foods recognises the significance of upholding and maintaining cultural practices. By providing meat with No added hormones, the brand supports the well-being of individuals while honouring age-old traditions and cultural heritage.

Share the goodness of purity through Real Halal meat, available at leading supermarkets and conveniently accessible through our online store at www.alislamifoodsonline.com. Enjoy a 10% discount with free delivery on all orders made through the online store.

The Fintech Revolution Summit: Redefining the Fintech Landscape in Egypt

By
Sahfy Sahfy
-

The Fintech Revolution Summit, the Region’s ONLY Event on Advancing Financial Innovation & Disruption is scheduled for August 2-3, 2023 in the vibrant city of Cairo. With the maxim “Redefining the Fintech landscape… A Summit for Innovators & Visionaries,” this event promises to be an exceptional gathering of industry leaders, thought provokers, and cutting-edge innovators.

Egypt’s burgeoning market on Fintech has positioned the country as a driving force in the region’s financial technology landscape. With a rapidly evolving ecosystem and an increasing number of startups and initiatives, Egypt has emerged as a fertile ground for innovation, digital transformation, and financial inclusion. The Fintech Revolution Summit aims to highlight the tremendous opportunities and challenges within Egypt’s fintech market, fostering collaboration, knowledge sharing, and strategic partnerships to drive further growth and advancement.

The Fintech Revolution Summit will feature a comprehensive agenda that delves into key topics such as Digital Payments, Risk Assessment, Green Revolution, Decentralized Finance, Fraud Prevention, Financial Inclusion, Regulatory Advancements, and much more… Renowned speakers from Egypt & the region will share their insights, experiences, and visionary ideas, providing delegates with valuable knowledge and actionable strategies to navigate the rapidly changing financial landscape.

Delegates will have ample networking opportunities, enabling them to forge meaningful connections with industry leaders, investors, entrepreneurs, and government officials. The summit will also showcase an exhibition space where leading fintech companies, startups, and solution providers can showcase their products, services, and innovations. With this edition, we have introduced FINTECH FRONTIER AWARDS to promote and encourage the continued growth and development of the FinTech industry, as well as to recognize those who are leading the way in this exciting and rapidly-evolving field

Join us at the Fintech Revolution Summit on August 2-3, 2023, in Cairo, Egypt, to be part of this transformative event that will redefine the future of finance in the region!

Egyptian Fintech Association is the Supporting partner of this edition, Cequens and Perfios are the Gold Sponsors and Zypl.ai is the Bronze Sponsor

Mr. Shyuj Kumar, the Managing Director of TraiCon Events, shared his excitement about the upcoming event: “We are honored to bring the Fintech Revolution Summit to the dynamic city of Cairo. This summit has consistently provided a platform for global finance and technology leaders to connect, collaborate, and chart the future of the fintech industry. With a strong focus on Egypt’s fintech market, we aim to explore new horizons, empower innovators, and inspire visionary solutions that redefine the financial landscape.”

About the organizer:

TraiCon India is a leading provider of global trainings, B2B events and management consulting for diversified industries that are looking to scale opportunities and be more effective in delivering their businesses to the right people at the right time. TraiCon conceptualizes & organizes flagship events on Emerging Technologies in APAC & MENA region

ARAB BANK GROUP PROFITS GROW BY 59% TO $401 MILLION FOR THE FIRST HALF OF 2023

By
Sahfy Sahfy
-

Arab Bank Group reported solid results for the first half of 2023, The Group’s strong performance was driven by robust growth in its core banking business across different markets, as net profit after tax increased by 59% reaching $401 million as compared to $252 million for the same period last year.

The Group maintained its strong capital base with a total equity of $10.6 billion. Loans grew to $36.1 billion and deposits reached $48.3 billion. Excluding the impact of devaluation of several currencies against the US dollar, loans and deposits grew by 2% & 5%, respectively.

Mr. Sabih Masri, Chairman of the Board of Directors, stated that the solid financial performance during the first six months underscores the resilience of the bank’s diversified business model that is based on prudent risk management practices and focused on achieving sustainable growth. Mr. Masri emphasized on the bank’s commitment towards the execution of its innovation and digital transformation strategy to deliver the best banking experience to our clients.

Ms. Randa Sadik, Chief Executive Officer, stated that the strong financial results despite the volatility in the operating environment is a testament to the bank’s robust assets base and strong capitalization. Ms. Sadik highlighted that the bank’s net operating income grew by 50% driven by diversified core banking activities coupled with controlled operating expenses. Provisions held during the period reflect the bank’s prudent risk management strategy against the increased economic uncertainty witnessed globally and regionally.

Ms. Sadik added that the bank is well positioned for sustained earnings growth with the support of its solid financial position, strong capitalization, and high liquidity levels. The Group’s loan-to-deposit ratio stood at 74.7% and credit provisions held against non-performing loans continue to exceed 100%. Arab Bank Group maintains a strong capital base that is predominantly composed of common equity with a capital adequacy ratio of 16.8%.

In line with the bank’s commitment towards sustainability, Arab Bank recently released its 13th annual sustainability report featuring its achievements during 2022 on the environmental, social, and governance (ESG) fronts.

Arab Bank was named the “Best Bank in the Middle East for 2023” by Global Finance magazine for the eighth consecutive year. The bank also received the “Best ESG Integration in Jordan” award from The Arab Federation of Capital Markets in collaboration with the Global Economics Magazine.

The UAE issues a new decision regarding tax procedures to implement the new tax law 2023.

By
Sahfy Sahfy
-

Today, the Ministry of Finance in the UAE announced the issuance of Cabinet Resolution No. (74) of 2023 regarding the executive regulations of Federal Decree-Law No. (28) of 2022 regarding tax procedures (the “new tax procedures law”), which annuls the Cabinet’s decision and replaces the regulation The current executive regulations related to tax procedures in order to be in line with the new tax procedures law, which entered into force as of March 1, 2023, including updating definitions, procedures and processes.

Noting that with the entry into force of the corporate tax law from tax periods beginning on or after June 1, 2023, the new tax procedures law will support the application of all relevant legislation in addition to providing taxpayers with the necessary guidance to understand how to apply the tax system and ensure continuous compliance.

The new cabinet decision stipulates the requirements for maintaining accounting records and commercial books, as well as the period and method for keeping them. The new Cabinet decision also includes updates related to the conditions for registering, canceling and suspending a tax agent, and the obligations and rights of a tax agent, including the requirement to communicate orally and in writing in Arabic and English.

Other important updates include procedures related to reconciliation in tax evasion crimes in terms of reconciliation terms and controls, tax refund procedures, tax payment and administrative fines in bankruptcy cases.

Cabinet Resolution No. (74) of 2023 comes into effect as of August 1, 2023, and as an exception from that, Clause (2) of Article (12) of this decision, related to the conditions that must be met by a legal person wishing to be registered in the tax agents register, starts with From December 1, 2023.

The Minister of Trade and Industry meets with the President of Mercedes-Benz to discuss expansion opportunities in the Egyptian market and the export of electric cars.

By
Sahfy Sahfy
-

Eng. Ahmed Samir, Minister of Trade and Industry, held an extensive meeting with a delegation of Mercedes-Benz Egypt, headed by Mr. Gerd Petrelich, CEO of the company. The meeting reviewed the company’s current and future projects in the Egyptian market, as well as the company’s export opportunities in the regional and global markets.

The minister said that the ministry is keen to provide all aspects of support to global auto manufacturers to continue and expand in the Egyptian market in order to meet the needs of the local market and export to foreign markets, pointing out the ministry’s keenness to hold permanent meetings with companies investing in the Egyptian market to review their demands, and provide immediate solutions and responses to these. Demands in cooperation with all ministries and concerned authorities in the state.

Samir pointed out that there are great opportunities for the company to produce electric trucks in Egypt, especially in light of the great support provided by the state to car production companies to localize the electric car industry in the Egyptian market.

The minister pointed out the importance of benefiting from the network of free and preferential trade agreements signed with a large number of countries and regional and global economic blocs, which allow free access to products manufactured in Egypt to the markets of these countries, pointing out that there is a great opportunity for Mercedes-Benz Egypt to expand its exports to the markets of countries. Members of these agreements, which cover a large number of global markets.

For his part, Mr. Gerd Petrelich, CEO of Mercedes-Benz Egypt, explained that the company pays great attention to the continuation and expansion of the Egyptian market as one of the most important markets in the Middle East and Africa, pointing to the company’s keenness to take advantage of the large investment opportunities and ingredients available in the Egyptian market to enhance Its production capabilities meet the needs of the local market and export to foreign markets.

The company’s delegation praised the new administrative capital, which represents a great cultural and administrative transition and represents an important addition to the achievements made by the Egyptian state on its way towards the new republic.

SODIC records EGP 8.2 billion in gross contracted sales driven by strong uptake of both new and ready-for-delivery projects.

By
Sahfy Sahfy
-

SODIC sold 674 units during the first six months of 2023, generating gross contracted sales of EGP 8.17 billion, an increase of 22% over EGP 6.67 billion of gross contracted sales recorded during the first half of 2022. Gross contracted sales during the period showed strong performance despite the company slowing down sales during the first quarter to review selling prices amid increasing construction costs. Sales were driven by strong demand for new launches of off-plan units and ready-for-delivery inventory across the SODIC’s projects in the second quarter of the year despite a significant increase in selling prices due to inflation.

Gross contracted sales were driven by strong sales on SODIC’s projects across all main markets. West Cairo projects accounted for 52% of gross contracted sales, primarily driven by the continued strong demand for SODIC’s relaunched 464-acre project, which contributed 32% of the period’s sales. On the other hand, East Cairo projects accounted for 34% of SODIC’s H1 2023 sales, on the back of strong uptake of newly released inventory on Villette which contributed 21% of the period’s sakes. Finally, North Coast June accounted for 15% of gross contracted sales fueled by robust demand for the project’s latest launch.

Cancellations of EGP 816 million were recorded during the first half of 2023, representing 10% of the period’s gross contracted sales. This is in line with a cancellation rate of 10% recorded in the same period in 2022 as the company currently prioritizes the cancellation of units in default, allowing these units to be resold at current market prices, supporting margins and increasing projects’ total returns.

Net cash collections reached EGP 4.06 billion for the period, with delinquencies at 4.5%. This compares to collections of EGP 2.93 billion and a delinquency rate of 8.2% recorded during the same period of 2022.

SODIC delivered some 402 units during the six months period, of which 212 were in East Cairo projects, while West Cairo and North Coast projects accounted for 189 and 1 of the delivered units, respectively. This compares to 463 units delivered during the same period last year.

CAPEX spent on construction during the period amounted to EGP 1.79 billion, compared to EGP 1.3 billion spent during H1 2022.

Financial Review;

 Income Statement

Revenues of EGP 2.92 billion were recorded during the first six months of 2023, representing a 7% increase compared to EGP 2.73 billion of revenues recorded during the same period last year.

Revenues were mainly driven by deliveries in West Cairo projects October Plaza and SODIC West’s Pavilion, Allegria Residence, and Six West, with West Cairo projects contributing 52% of the period’s delivered value. On the other hand, East projects accounted for a further 47% of the value delivered during H1 2023 driven by deliveries on SODIC East.

Gross profit increased 22% YoY on the back of higher revenues to record EGP 1.12 billion, implying a gross profit margin of 38%. This compares to a gross profit of EGP 941 million and a gross profit margin of 34% recorded during the first half of 2022.

Operating profit for the six months period amounted to EGP 404 million, reflecting an operating profit margin of 14%. This represents a 4% growth over an operating profit of EGP 387 million and an operating profit margin of 14% recorded during the same period last year.

Net profit after tax and non-controlling interests came in at EGP 335 million, growing 15% from the EGP 292 million recorded during the first half of 2022. Net profit margin expanded 80bps YoY to 11%.

Balance Sheet

SODIC continues to maintain a strong liquidity position with total cash and cash equivalents[1] amounting to EGP 2.93 billion.

Bank leverage remains low, with bank debt to equity standing at 0.41x. Bank debt outstanding amounted to EGP 3.12 billion as of 30 June 2023. SODIC has been gradually increasing leverage mainly to enhance returns. Debt to equity amounted to 0.43x at year-end 2022, with EGP 3.16 billion of outstanding debt; and to 0.38x at year-end 2021, with EGP 2.55 billion of outstanding debt.

Total receivables stood at EGP 33.74 billion, of which EGP 7.50 billion are short-term receivables providing strong cash flow visibility for the company. A total of EGP 4.23 billion of receivables are reported on the balance sheet, reflecting only the receivables relating to delivered units already recognized as revenue. On the other hand, some EGP 29.52 billion of receivables related to undelivered units are disclosed in the footnotes.

SODIC’s total backlog of unrecognized revenue stood at EGP 38.56 billion as of 30 June 2023, providing strong revenue visibility for the company.

Commenting on the results Ayman Amer SODIC’s General Manager said “Despite the limited launches in the first quarter and the significant price increases to offset the effect of inflation we have achieved record H1 sales. It has been a very strong quarter for SODIC with the addition of 620 acres to our land bank in the north coast, one of our key markets. We look forward to a strong second half of the year.”

1...717273Page 72 of 73

EVEN MORE NEWS

POPULAR CATEGORY

©