ODH increases sales and reduces loss

With revenue of CHF 453.3 million, the revenue target of CHF 400.0 million was exceeded by 13.3%, according to Orascom Development Holding (ODH). Gross profit increased by 4.9% year-on-year from 108.7 million to 114.1 million. Adjusted EBITDA increased by 5.7% to 74.3 million (previous year: 70.3 million). Ebitda rose byTP3k 19.11 to 55.5 million (previous year: 46.6 million). AtT 31.3 million, the net loss was just underT 321 thousand below the previous year's figure.

ODH's share of the losses of Andermatt Swiss Alps (ASA), the Group's largest associated company, amounting to 15.7 million and additional one-off value adjustments of 21.5 million contributed to the net loss.

Andermatt Swiss Alps with high sales growth

ASA increased its turnover by 23.3 % to 167.3 million in the 2019 financial year (previous year: 135.7 million), ODH reports. Net real estate sales amounted to 62 million compared to 110 million in 2018 (including the 50 million Taurus deal). Property sales increased by 11.6% to 101.4 million (previous year: 90.9 million).

The ASA hotels increased their turnover by 44.6% from 26.9 million to 38.9 million, according to the report. The occupancy rate of the Chedi is put at 54%, that of the Radisson Blu at 36%. The SkiArena Andermatt-Sedrun recorded an increase in guest numbers of 5% from November to mid-March compared to the same period in the previous year, and more golfers used the course in Andermatt in 20%. Turnover in the Destination Management segment increased by 50.8% to 27 million (previous year: 17.9 million). Raphael Krucker took office as the new ASA CEO on January 1, 2020.

Due to the Covid-19 pandemic, all hotels in the destination of Andermatt are currently closed, as are the mountain railroads and stores. However, The Chedi and Radisson Blu hotels are due to reopen on 8 May 2020, the golf course will reopen at the end of May and the ski arena will start operating for the summer season at the beginning of July.

Accounting errors corrected

ODH also announced that it had reached an agreement with SIX Exchange Regulation AG regarding accounting errors in the 2018 financial statements. The errors had arisen in connection with the sale of the subsidiary Royal. Instead of transferring a revaluation reserve of 8.5 million when reclassifying the Royal building from owner-occupied property to investment property, the amount was integrated into the income statement for the 2018 financial year. As part of the agreement, ODH corrected the error in the 2019 financial statements, which resulted in, among other things, an increase in the loss for the 2018 financial year from 37.4 million to 45.9 million.

Lessons learned from the past for Covid-19

With regard to the outlook in connection with the corona crisis, ODH points out that the company has already been through difficult and sometimes comparable situations before - such as the effects of the Arab Spring in 2011 and the Egyptian revolution in 2013. It has acquired know-how that has now enabled it to react effectively and quickly implement the necessary precautionary measures to reduce expenditure and maintain liquidity for as long as possible in order to ensure the stability of the Group's destinations. These are expected to resume operations and planned investments as soon as the business returns to the Group's planned strategic and financial objectives.

"Our strategic ambitions remain clear - we will focus on generating cash, investing in opportunities and returning capital to shareholders, and we will accelerate the monetization of our land bank in 2020," says interim CEO Samih Sawiris. The group has already identified land plots for sale or for third-party development of certain projects, which could include new hotels, conference centers, schools, universities, hospitals, business parks and water parks, among others. (ah)