Palm Hills slumps to Q3 net loss
Cairo, November 3, 2011
Egyptian real estate group Palm Hills, the country's second-biggest listed developer, dropped to a third-quarter net loss on Thursday, hit by weaker revenue.
The firm, battered by land probes and cancellations after the uprising that toppled Hosni Mubarak in February, posted a 17.7 million Egyptian pound ($2.97 million) net loss for the third quarter compared with a 153.7 million net profit in the same quarter last year.
Palm Hill's revenue fell to 135.4 million pounds, a 64.5 percent drop from 381.7 million a year earlier. Palm Hills is among several real estate firms in the Arab world's most populous country facing legal challenges relating to its land bank.
Its chairman Yasseen Mansour and former housing minister Ahmed el-Maghrabi were cleared of corruption charges in a state land sale in July. The company is awaiting a verdict by another court on whether the contract for one of its land plots will be scrapped.
The firm is also facing other court cases contesting the legality of two of its land plots and has said it would return some plots of land to help manage cash flows.
Some analysts say Palm Hills may struggle to rebuild its balance sheet, one of the weakest among Egyptian real estate developers. Palm Hills posted a nine-month loss of 99.1 million pounds, compared with a 345.1 million net profit for the same period a year earlier. - Reuters