-        Revenue – EGP1.5bn, +39% Y-o-Y, +110% Q-o-Q

-        Gross profit – EGP584mn, +332% Y-o-Y, 67% Q-o-Q  

-        Net profit – EGP620mn, +463% Y-o-Y, +67% Q-o-Q

Emaar Misr reported its financial results for 4Q16. Net income for the quarter grew by more than five folds, boosted by higher revenue (+39% Y-o-Y), expanded gross profit margin (38.7%, +26pps Y-o-Y, compared to an exceptionally weak quarter) and higher interest income (EGP201mn, +2.2x Y-o-Y), with the latter representing c32% of the bottom-line. Operational metrics for the quarter were not released, and Emaar Properties investor presentation is also yet to be disclosed. Based on Emaar Properties’ international sales figure (AED3.9bn), we estimate contracted sales during the year for Emaar Misr to have at least matched last year’s EGP8.6bn, pending confirmation upon the release of Emaar properties investor presentation (expected in March).   

Key positives

-        Robust growth in revenue, coming in at EGP1.5bn (+38.7% Y-o-Y, +109.9% Q-o-Q). 2016 revenue totalled EGP4.0bn (+23.8% Y-o-Y)

-        Strong gross profit margin, averaging 38.7% (+26.4pps Y-o-Y, -9.4pps Q-o-Q). At Marrasi, gross profit margin was 48.1% (3Q16: 58.6%), while at UTC, the margin was 22.5% (4Q15: 18.5%, 3Q16: 32.2%). In Mivida, gross profit margin was 36.3% (4Q15: 24.0%, 3Q16: 37.5%)

-        Net income grows by more than five folds Y-o-Y, coming in at EGP620.2mn (+463% Y-o-Y, 67% Q-o-Q), of which roughly a third were brought in by interest income. 2016 net income was EGP1.7bn (+97% Y-o-Y), with growth coming from higher revenue, improved gross profit margins and higher interest income

-        Emaar Misr holds a net cash position of EGP3.0bn (+17% Q-o-Q) 

Emaar Misr: EGP2.61 as of 28 Feb. 2017, Rating: Buy, TP: EGP3.74/share, MCap: USD748mn, EMFD EY/EMFD.CA