Despite not launching any new real estate projects, the company achieved a noteworthy performance, driven by the natural appreciation and increased sales prices of its existing portfolio. This success was further underscored by the phenomenal launch of the second phase of its SouthMED project on May 4, 2025. The second phase generated an impressive 70 billion Egyptian pounds in sales on its opening day, far exceeding the first-day sales of the project's initial launch in 2024. As a result, the Group's total announced real estate sales from the beginning of the year to May 7, 2025, reached approximately 160 billion Egyptian pounds.
The confidence of over 200,000 high-net-worth clients
underscores the group's influence. Their robust sales are a result of their
keen understanding of market dynamics, enabling them to deliver high-caliber
real estate ventures. Their innovative payment structures and
market-influencing payment systems further solidify their position as
standard-setters within the Egyptian real estate landscape.
The unprecedented success of the SouthMED project and other
ventures underscores TMG's position as the preferred first choice for
customers. This preference, coupled with the company's strong brand value and
reputation, consistently drives sales, even amidst broader market fluctuations.
The Group's stock exchange announcement highlighted a
remarkable 94% surge in its sales backlog, which climbed to 350 billion
Egyptian pounds in Q1 2025, a substantial increase from the 180 billion pounds
recorded in Q1 2024. This significant growth is a direct result of robust sales
driven by recent project launches and the natural appreciation in volume and
value of previously launched projects. The reported backlog benefits from
stable demand from a strong base of genuine end-user clients.
Excluding the SouthMED project, where around 18,000 units
have already been sold, the current backlog includes approximately 39,400
residential and non-residential units slated for delivery over the next 4-5
years. This substantial backlog provides the group with clear visibility into
expected future revenues and profits.
The Group anticipates maintaining and enhancing the
profitability of unrecognized sales. This expectation is driven by existing
infrastructure investments, the low historical cost of land, and potential
future savings in building material costs. TMG's strong liquidity and
purchasing power support these potential savings and ensure a solid financial
position, facilitating future profits and strong income growth while
maintaining project quality.
The hotels sector experienced substantial growth in the
first quarter of 2025, generating total revenues of 3.5 billion Egyptian pounds
(equivalent to 69 million US dollars). This represents a significant 50%
increase compared to the 2.3 billion Egyptian pounds recorded during the same
period last year. The operating revenues of the Four Seasons hotels – Four
Seasons Nile Plaza, Four Seasons Sharm El Sheikh, and Four Seasons San Stefano,
in addition to the Nile Kempinski Hotel – amounted to approximately 1.32
billion Egyptian pounds during the first quarter of 2025, compared to 869
million Egyptian pounds during the same period last year, representing a growth
rate of 51.4%.
The operating revenues of the portfolio of Legacy Hotels and
Resorts Company – which owns Marriott Omar Khayyam Zamalek, Marriott Mena House
Cairo, Sofitel Legend Old Cataract Aswan, Mövenpick Resort Aswan, Sofitel
Winter Palace Luxor, Steigenberger Hotel El Tahrir, and Steigenberger Cecil
Alexandria – reached 2.19 billion Egyptian pounds. This represents a
significant 51.8% increase compared to the 1.44 billion Egyptian pounds
recorded during the same period last year.
It is worth mentioning that in 2024, the group successfully
completed the acquisition of Legacy Hotels and Resorts Company (Legacy), which
owns seven iconic historical hotels in Egypt. This acquisition increased the Group's
hotel room portfolio by 2,500 rooms, bringing the total to 3,500 rooms. This
expansion provides significant geographical diversification and access to a
targeted market, bolstering confidence in the group's recurring income and its
potential for high-profit margins and foreign currency generation.
In the coming years, the acquired hotels are slated for
renovation and refurbishment with several key objectives: to improve and
maximize their profitability, to integrate them seamlessly with the group's
original portfolio, to capitalize on the inherent value of their unique
locations, and to safeguard their historical heritage for future generations of
Egyptians.
It is also worth noting that the funding for all future
renovations and improvements of the acquired hotels was included in the
acquisition price. This ensures that the Group's future cash flows will not be
burdened by any additional financial obligations when these upgrades are
implemented.
At the same time, the Group is developing three new hotels –
Four Seasons Luxor, Four Seasons Madinaty, and Marsa Alam Resort – with
operations expected to commence in 2026, thereby increasing its presence in key
markets. Looking ahead, several ultra-luxury hotel projects are in the
pipeline, poised to grow the Group's total room portfolio to approximately
5,000 in the coming years.
The recurring revenue and service activities sector also
demonstrated substantial growth in the first quarter of 2025, achieving
revenues of 2.1 billion Egyptian pounds. This represents a significant 116%
increase compared to the 979 million Egyptian pounds recorded during the same
period last year.
Notably, the group's strategic revenue diversification, fueled by international projects like the Banan project in Saudi Arabia and the expansion of its hotel portfolio, is projected to double its foreign currency revenues. In 2024, foreign currency-denominated revenues constituted approximately one-third of the group's total, highlighting the significant contribution of the hotels sector. This aligns with the group's long-term strategy to have nearly 60% of its total revenues denominated in foreign currencies, thereby strengthening its financial position and providing a hedge against exchange rate volatility.