Earnings Report /
Egypt

MNHD: Results continue to suffer in shadow of land-sale-backed 2020

  • 9M21 sales dropped 39.6% y/y to EGP2.7 billion from 9M20 level that had been supported by the EGP1.1 billion land sale

  • 3Q21 revenue was down 4.3% y/y to EGP428.4 million, due to a decline in unit deliveries

  • 3Q21 net profit decreased 85.6% y/y and 81.2% q/q to EGP21.4 million

Al Ahly Pharos Securities Brokerage
9 November 2021

Sales decline from 9M20 level

  • Sales in 9M21 dropped 39.6% y/y to EGP2.7 billion from EGP4.5 billion in 9M20 that had been supported by the EGP1.1 billion land sale. Excluding the EGP1.1 billion land sale from 9M20 sales would still translate into a 19.2% y/y drop in 9M21 sales.

  • Revenue in 3Q21 was down 4.3% y/y to EGP428.4 million, due to a 16.5% y/y decline in unit deliveries, and down 7.2% q/q despite a 42.5% q/q rise in unit deliveries which implies a lower-value delivery mix q/q. 9M21 revenue declined 21.5% y/y to EGP1.4 billion due to 9M20 revenue having included land sale proceeds. Deliveries in 9M21 were up 64.7% y/y to 570 units in preparation for MNHD’s securitization program.

  • Gross profit in 3Q21 declined 63.6% y/y and 56.8% q/q to EGP115.9 million, leading to a lower GPM of 27.1% and bringing 9M21 gross profit to EGP627.4 million, down 44.9% y/y.

  • Net profit in 3Q21 decreased 85.6% y/y and 81.2% q/q to EGP21.4 million, translating into a low NPM of 5.0% and bringing 9M21 net profit to EGP250.0 million, down 60.4% y/y.

Maintain Overweight

We maintain our Overweight recommendation of MNHD which is supported by MNHD’s residual land bank in Taj City and SARAI.