The Sixth of October Development & Investment Company (SODIC) has reported achieving EGP 429m in revenues during the first quarter (1Q) of 2020.
The results, which compare to the EGP 941m recorded during the same period in 2019, were reported in its consolidated financial results for the period ending 31 March.
The company said that total gross profits reached EGP 114m during 1Q 2020, implying a gross profit margin of 26%, compared to EGP 270m and a margin of 29% during 1Q 2019.
Gross margins achieved on real estate development operations improved slightly by 50 bps on the back of an improved delivery mix to reach 30%. The total gross margin, however, was negatively affected by losses on clubhouse and golf course operations.
SODIC’s operating profits came in at EGP 36m, reflecting an operating profit margin of 8% for the quarter. This compared to EGP 149m, at an operating profit margin of 16%, for the same period in 2019, with the decline mainly attributable to the decrease in revenues.
Additionally, total gross contracted sales for the period were down 14%, recording EGP 865m in Q1 of 2020, versus EGP 1.01bn for the same period last year. Commercial sales contributed only 2.6% to the company’s gross contracted sales during 1Q 2020, versus 33% of gross contracted sales during the same period last year.
SODIC’s home market developments in West Cairo contributed 70% of the company’s sales for the quarter driven by the strong performance of VYE project, the company’s newest project. VYE represented 45% of SODIC’s sales during the period.
On the other hand, 30% of the company’s sales came from projects in East Cairo, mainly from Villette, which generated 20% of the quarter’s gross contracted sales.
Cancellations were recorded at 22% of gross sales in 1Q 2020, compared to the 12% recorded in 1Q 2019.
Net cash collections reached EGP 986m during 1Q 2020, with delinquencies at 11%. This compares to collections of EGP 1.1bn and a delinquency rate of 7% recorded during the same period last year.
“Net profits after tax and non-controlling interests amounted to EGP 28m for 1Q 2020 reflecting a margin of 6%, this compares to EGP 161m at a net profit margin of 17% during 1Q 2019,” the company said. “SODIC continues to maintain a strong liquidity position with total cash and cash equivalents amounting to EGP 3.85bn, providing strong comfort for its operations in the face of the uncertainties presented by the current pandemic.”
Receivables remain at EGP 13.1bn providing strong cash flow visibility, of which EGP 3.9bn are short term receivables. Client deposits as at the end of 1Q 2020 amounted to EGP 18.4bn, providing strong revenue visibility for the company, the company disclosed.