EQS-News: Edison Investment Research Limited / Key word(s): Research Update Edison issues update on Palm Hills Developments 15-Feb-2017 / 10:12 GMT/BST
London, UK, 15 February 2017
Edison issues update on Palm Hills Developments (PHDC)
Palm Hills continues to perform well at the top line with record annual revenues of EGP5.6bn driven by the company's best year for both reservations and the delivery of units. The accelerated construction programme is helping to mitigate the effects of inflation and management reports a strong start to 2017 in terms of both sales and construction. Improvements in the balance sheet are expected as the securitisation programme that began in Q416 brings forward cash flows and helps to pay back debt.
We have suspended our forecasts pending publication of the IFRS accounts, but we note that the current share price, c EGP0.19 above Palm Hills' NAV per share of EGP2.69, ascribes little value to potential uplifts to the hotels and undeveloped land bank (guided to be worth c EGP1.81) nor to future profits. Management indicates that any distribution in FY17 is likely to be in the form of a share buyback. Click here to view the full report.
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