Egyptian Resorts, a real estate firm operating out of Cairo has seen a dramatic drop in profits of 90% for the first half of 2010. This has happened because the company failed to sell any land during the period. Though the analysts and sources close to the company believe that the earnings will bounce back as early as next year due to the partnership to develop land with property developer Orascom Development Holding.
The company has been unable to sell any land at all for eight consecutive quarters and the sales famine is expected to go on till the end of 2010 when the turn around might start taking effect. Abu Bakr Makhlouf, the investor relations manager of the company sounded very optimistic and confident about the future of the company and its performance in the coming months. The present condition is only a reflection of the world economic scenario which has led the property developers to postpone land deals due to an uncertain environment.
There are several deals in the pipeline which is the basis of their confidence. Orascom Development who have bought a 4.5% stake in the company are going to develop its Sahl Hasheesh Resort on 618 acres. Mohamed Kamel, the new CEO of the company stressed that the company is financially very comfortable in terms of cash and receivables and the new marina project will prove to be a game changer in the very first quarter of 2011.