CAIRO: Egyptian real estate developer Palm Hills Developments saw its fourth-quarter profit and revenue jump on a year earlier, beating two analysts forecasts after the company booked more contracts than expected.
Egypt s real estate sector, while not immune to the financial crisis, has fared relatively well compared with other regional economies, thanks to strong local demand and its insulation from international credit markets.
Palm Hills s net sales in the fourth quarter of 2009 rose more than threefold year-on-year to LE 470.8 million ($85.8 million), while net profit rose 63 percent to LE 185.1 million, it said in a statement on Monday.
Despite the fourth quarter of 2009 being a slow quarter for sales, Palm Hills had managed to record LE 1 billion in contracts, which we think is impressive, Naeem analyst Hisham Halaldeen said in a note on the results.
With seven new launches due this year, we expect Palm Hills to outperform its competition.
Palm Hills, which builds mostly in Egypt s luxury segment, has said it is trying to build cheaper homes, expand into hotel and retail property ownership and accelerate construction to take advantage of cheaper building materials.
Cement prices in Egypt have retreated from highs in the first quarter of 2009, and stabilized since an export ban was imposed last year.
Palm Hills said total new reservations stood at LE 580 million in the fourth quarter of 2009, 31 percent higher than a year earlier, when the global economic downturn slowed real estate sales in Egypt.
Fourth-quarter cancellations dropped to LE 292.2 million after peaking at LE 624.7 million in the first quarter of 2009.
Investment bank EFG-Hermes had forecast a net profit of LE 145 million and revenue of LE 320 million in the fourth quarter, while CI Capital had forecast net profit of LE 183 million and net sales of LE 415 million.