9M 2017 Results Agenda 9M 2017 Key Highlights Page 3 9M 2017 - - PowerPoint PPT Presentation

9M 2017 Results

2

9M 2017 Key Highlights Page 3 9M 2017 Destination Progress and Outlook Page 5 Financial Review Page 12

Agenda

3

Key Highlights 9M 2017

ODE records solid earnings performance with continued strong growth across all its business segments. Revenues increased by 79.5% to EGP 1,722.4 million vs. EGP 959.7 million in 9M 2016. Adjusted EBITDA increased by 140.8% to EGP 661.7 million and Net Profits for ODE’s shareholders reached EGP 193.7 million.

➢ Net real estate sales more than doubled to EGP 977.8 million in 9M 2017 vs. EGP 487.1 million in 9M 2016. ➢ Real estate revenues reached EGP 426.4 million, a 45.2% increase over EGP 293.7 million in 9M 2016, with increased unit deliveries. ➢ Hotels revenues increased by 122.0% to reach EGP 734.1 million vs. EGP 330.7 million in 9M 2016 on the back of the new hotel strategy implemented since the beginning of 2017. ➢ Hotels gross operating profits (GOP) increased by 737.9% to reach EGP 280.7 million vs. EGP 33.5 million in 9M 2016. ➢ Town Management revenues increased by 69.8% to EGP 312.4 million vs. EGP 184.0 million in 9M 2016. ➢ Adjusted EBITDA increased by 140.8% to reach EGP 661.7 million compared to EGP 274.8 million in 9M 2016. ➢ Net profit attributable for ODE’s shareholders during the period reached EGP 193.7 million vs. a net loss of EGP 150.3 million in 9M 2016. ➢ Advanced discussions with private owners on a land plot in the North Coast to enter the second homes market.

4

9M 2017 Company Highlights Page 3 9M 2017 Destination Progress and Outlook Page 5 Financial Review Page 12

Agenda

5

Business Segments 9M 2017

1 Adjusted EBITDA: EBITDA adjusted for non cash items (which includes provisions & impairments, other gains and losses, FX gains & share in associates) 2 Town Management includes revenues from Utilities and services, Golf, Rentals, Hospital, Educational services, Marina, Limousine, Laundry and other town amenities.

Revenue EBITDA

• Adj. EBITDA1

(EGP mn) 9M 2017 9M 2016 Δ in % 9M 2017 9M 2016 9M 2017 9M 2016 Hotels 734.1 330.7 122.0% 413.0 (9.1) 310.6 28.8 Real Estate 426.4 293.7 45.2% 300.7 230.7 291.5 160.4 Land

• 62.7
• 27.9

Town Management2 312.4 184.0 69.8% 37.9 17.3 38.6 15.5 Tamweel Group 249.5 151.3 64.9% 91.6 66.0 95.1 67.4 Corporate & Unallocated Items

• (14.7)

(202.9) (74.1) (25.2) ODE Group 1,722.4 959.7 79.5% 828.5 164.7 661.7 274.8

6

Business Segments 3Q 2017

1 Adjusted EBITDA: EBITDA adjusted for non cash items (which includes provisions & impairments, other gains and losses, FX gains & share in associates) 2 Town Management includes revenues from Utilities and services, Golf, Rentals, Hospital, Educational services, Marina, Limousine, Laundry and other town amenities.

Revenue EBITDA

• Adj. EBITDA1

(EGP mn) 3Q 2017 3Q 2016 Δ in % 3Q 2017 3Q 2016 3Q 2017 3Q 2016 Hotels 285.3 147.7 93.2% 138.1 36.1 135.0 37.7 Real Estate 125.9 71.7 75.6% 94.1 40.2 92.4 50.9 Land

• (8.4)
• (9.4)

Town Management2 126.3 67.4 87.4% 3.0 1.0 3.7 1.5 Tamweel Group 91.2 54.8 66.4% 27.6 22.9 30.1 23.7 Corporate & Unallocated Items

• 34.2

(14.7) (39.3) (11.0) ODE Group 628.7 341.6 84.0% 297.0 77.1 221.9 93.4

7

Net value of Contracted Units (EGPmn) Number of Contracted Units Average Selling Price (EGP/m2) Destination 9M 17 9M 16 9M 17 9M 16 9M 17 9M 16 El Gouna 958.9 474.4 173 122 34,546 24,968 Fayoum 17.5 2.6 16 3 11,039 7,844 Makadi 1.4 2.2* 3

• 4,802

4,683 Gardania

• 7.9
• 1
• 12,188

ODE Group 977.8 487.1 192 126 32,754 23,560

Real Estate KPIs 9M 2017, 3Q 2017 & Deferred Revenue

Revenue Recognition Schedule (EGPmn)

Destination Deferred Revenue Balance 2017 2018 2019 2020 2021 El Gouna 1,375.6 272.3 792.9 310.4

• Fayoum

22.6

• 2.8

9.5 6.0 4.3 Makadi

• ODE Group

1,398.2 272.3 795.7 319.9 6.0 4.3 Destination 3Q 17 3Q 16 3Q 17 3Q 16 3Q 17 3Q 16 El Gouna 253.9 126.4 44 29 39,772 49,706 Fayoum 4.3 2.3 2 1 13,160 9,081 Makadi 1.0 (0.6) 2 (7) 4,652

• ODE Group

259.2 128.1 48 23 36,925 24,492

* Upgraded fees for existing units.

8

Total number of hotel rooms Number of available rooms Occupancy for available rooms (%) TRevPAR* (EGP) GOP PAR** (EGP) Destination 9M 17 9M 16 9M 17 9M 16 9M 17 9M 16 9M 17 9M 16 9M 17 9M 16 El Gouna1 2,521 2,506 2,521 2,506 77 56 915 403 427 85 Taba Heights2 2,365 2,365 1,260 718 31 33 205 197 (23) (82) Fayoum3 50 10 50 10 39 27 360 210 (27) (562) Floating Hotel 27 27 27 27 17 5 1,434 322 298 (320) Makadi4 1,113 1,113

• 491

ODE Group 6,076 6,021 3,858 3,752

Hotel KPIs 9M 2017 & 3Q 2017

* Financial KPIs are calculated based on the number of available rooms during the reported period of 9M 17 and 3Q 17. ** Includes all expenses of the hotels in the destinations. 1. In 9M 17 we transferred 82 hotel rooms of Fanadir and Bellevue into real estate products and in Q3 2017 Ancient Sands hotel room increased by 97 rooms. 2. During 9M 2017, only 4 hotels were operating (Sofitel with 442 rooms, Strand Beach Hotel with 503 rooms, El Wekala Hotel with 215 rooms and 100 rooms in Bay View Hotel out of 394 existing rooms). Whereby, only 2 hotels were operating representing 718 rooms in 9M 2016. 3. In September 1st, 2016, Byoum Lakeside Hotel was opened. 4. Our 3 hotels in Makadi were rented to FTI Group since Jan. 2017. Where by in 9M 2016 only 1 hotel was operating (Royal Azur with 491 rooms).

Destination 3Q 17 3Q 16 3Q 17 3Q 16 3Q 17 3Q 16 3Q 17 3Q 16 3Q 17 3Q 16 El Gouna1 2,521 2,506 2,521 2,506 80 64 1,042 505 474 146 Taba Heights2 2,365 2,365 1,260 718 41 49 290 295 15 (1) Fayoum3 50 10 50 10 25 27 300 210 (74) (562) Floating Hotel 27 27 27 27 8 3 770 202 (184) (282) Makadi4 1,113 1,113

• 491

ODE Group 6,076 6,021 3,858 3,752

9

El Gouna, Egypt

9M 2017 Highlights and Outlook:

▪ Net sales increased by 102.1% to EGP 958.9mn vs. EGP 474.4mn in 9M 2016. ▪ Hotels GOP surged by 431.5% to EGP 285.4mn compared to EGP 53.7mn in 9M 2016. ▪ Successfully hosted the first edition of El Gouna Film Festival and for which we have built four new high standard cinemas. ▪ Launched a new high-end real estate project over looking the marina “Abu Tig Hills” in Q4 2017 with a total inventory of USD 22.0mn and was completely reserved in one month. ▪ Continuing with the renovation work across some of our hotels. ▪ Finalized the construction of the party event area which will hold a capacity of 2,500 guests. ▪ Planning to launch Phase II of G-Space by mid-December 2017 following the great success of Phase I. Financials & KPIs 9M 2017 9M 2016 % Chg Hotels Number of rooms 2,521 2,506 0.6%

• Occ. for available rooms (%)

77 56 37.5% TRevPAR (EGP) 915 403 127.0% GOP PAR (EGP) 427 85 402.4% Total Revenues (EGPmn) 616.8 273.4 125.6% Real Estate Net Contracted Units (EGPmn) 958.9 474.4 102.1% No of Contracted Units 173 122 41.8%

• Avg. Selling Price (EGP/m2)

34,546 24,968 38.4% Total Revenues (EGPmn) 420.3 273.4 53.7% Deferred Revenue (EGPmn) 1,375.6 802.2 71.5% Destination Management Total Revenues (EGPmn) 280.4 176.0 59.3%

10

Taba Heights, Egypt

9M 2017 Highlights and Outlook: ▪ Taba Heights remains the most challenging destination for the group due to the extended travel bans on Sinai. ▪ Occupancy for the operating hotels reached 31% vs. 33% in 9M 2016. ▪ Successfully curbed the GOP losses from EGP 11.4mn in 9M 2016 to EGP 6.3mn in 9M 2017. ▪ We re-opened another 100 rooms in Bay View Hotel out of the existing 394 rooms. ▪ To date we have 1,260 operating rooms out of 2,365 rooms compared to only 718 rooms operating in 9M 2016. This will make 4 hotels out of 6 open.

Financials & KPIs 9M 2017 9M 2016 % Chg Hotels Number of rooms 2,365 2,365

• Number of rooms available

1,260 718

75.5%

Total Revenues (EGP mn) 55.6 26.2

112.2%

• Occ. for total rooms (%)

13 7

85.7%

• Occ. for available rooms (%)

31 33

(6.1%)

TRevPAR (EGP)* 205 197

4.1%

GOP PAR (EGP)* (23) (82)

72.0%

* Financial KPIs are calculated based on the number of available rooms during the reported period of 9M 17.

11

9M 2017 Highlights Page 3 9M 2017 Destination Progress and Outlook Page 5 Financial Review Page 12

Agenda

12 12

(EGP mn) 3Q 2017 3Q 2016 9M 2017 9M 2016 Revenue 628.7 341.6 1,722.4 959.7 Cost of sales (410.4) (246.2) (1,077.9) (694.6) Gross profit 218.3 95.4 644.5 265.1 Gross profit margin 34.7% 27.9% 37.4% 27.6% Investment income 34.4 18.9 71.4 43.2 Other gains and losses 78.1 (18.0) 176.4 (87.6) Administrative expenses (33.7) (16.9) (63.2) (48.7) Share of associates losses (0.1) (2.3) (0.6) (7.3) EBITDA 297.0 77.1 828.5 164.7 Depreciation (65.2) (41.1) (165.9) (121.0) Finance costs (108.8) (70.8) (307.6) (198.9) Income tax expense (30.5) (11.2) (86.2) (26.6) Net profit/(loss) for the period 92.5 (46.0) 268.8 (181.8) Attributed as follows: ODE shareholders 76.3 (44.3) 193.7 (150.3) Non-controlling interest 16.2 (1.7) 75.1 (31.5) Basic EPS (EGP) 0.34 (0.20) 0.87 (0.68)

1 1 2 3

Notes Revenues and gross profit margin increased due to the enhanced operational performance across all business segments. Other gains and losses includes: Profits from:

• Gains

in relation to settlement

• f

borrowings in the amount

• f

EGP 114.0mn.

• FX of EGP 60.0mn.
• Other items in the amount of EGP 2.4mn.

The share of associates losses decreased mainly due to the enhanced operations of the associate companies. Increase in Finance costs mainly due to:

• Increase

in the translation

• f

USD denominated loans when translated to EGP.

• Increase in interest rates.

Income Tax expense increased due to the increase of the profitability of the company.

1

2

4 5

3

5

4

Income Statement

13 13

Balance Sheet

Notes PPE decreased mainly due to the reclassification

• f the 3 rented hotels in Makadi to investment

property. Other assets increased mainly due to the increase in the investment property as a result of renting the 3 hotels in Makadi. Asset held for sale and liabilities held for sale increased mainly due to the increase in Tamweel activities during the period. Borrowings decreased mainly due to the settlement from one of our subsidiaries. Other liabilities increased mainly due to:

• Increase in shareholders current account.
• Increase of advanced payments from our real

estate sales.

1 2

(EGP mn) 30.09.17 31.12.16 Property, plant and equipment 3,623.0 3,814.3 Inventories 692.7 586.0 Receivables 1,413.7 1,428.4 Cash and bank balances 1,095.5 871.1 Investments in associates 108.7 109.3 Other assets 1,312.2 940.4 Non-current assets held for sale 1,592.2 1,349.4 Total assets 9,838.0 9,098.9 Borrowings 4,544.4 4,647.4 Payables 362.9 352.7 Provisions 302.9 317.9 Other liabilities 1,417.1 1,087.7 Liabilities related to assets held for sale 1,377.1 1,117.6 Total liabilities 8,004.4 7,523.3 Non-controlling interests 431.8 355.7 Equity attributable to ODE shareholders 1,401.8 1,219.9 Total liabilities and equity 9,838.0 9,098.9

3 2 1 3 3 4 4 5 5

14 14

Cash Flow Statement

(EGP mn) 9M 2017 9M 2016 Cash from operations 334 253 Interest paid (25) (10) Taxes paid (51) (29) Operating Cash Flow 258 214 Payments for PP&E (148) (331) Other items 68 39 Investing Cash Flow (80) (292) Change in Borrowings 62 203 Financing Cash Flow 62 203 Net change in cash/equivalents 240 125 Cash & bank balances beginning of period 894 821 Cash and bank balances end of period 1,134 946 Notes

Cash flow from operations increased due to enhanced performances

• f

business segments. Payments for PP&E includes payments related to Tamweel activity and hotels renovations during the period. Change in Borrowings mainly resulting from: (-) Debt repayment of EGP 213.0mn. (+) Loan proceeds related to Tamweel for EGP 182mn & others EGP 10.0mn. (+) Proceeds from other shareholders EGP 83.0mn.

1 2 3 1 2 3 1

15 15

Financing Profile 1

Interest expense by currency

in %, as of 30.09.17

1 All debt figures exclude debt relating to Tamweel Mortgage Finance 2 Equity Ratio = Total Equity/Total Assets

Total debt by currency

in %, as of 30.09.17

30.09.17 31.12.16 Equity ratio (%)2 18.6% 17.3% Weighted average cost of debt (%) 9.22 7.75% 39% 57% 4%

EGP USD EUR

18% 76% 6%

EGP USD EUR

16 16

IR Dashboard

Investor Relations Contact:

Sara El Gawahergy Head of Investor Relations Tel Dir +20 (0) 22 461 89 61 Mobile CH: +41 41 874 1711 sara.elgawahergy@orascomdhcom ir@orascomdh.com www.orascomhd.com

17 17

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 Egypt’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 Egypt’s results of operations and on whether Orascom Development Egypt will achieve its targets. Orascom Development Egypt 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.

Disclaimer