The shares lost 2.3 percent, the most since July 15, to 4.17 Egyptian pounds at the close in Cairo. The benchmark EGX 30 Index retreated 1.1 percent. The stock has rallied 41 percent this year, compared with a 38 percent increase for the EGX 30.
Net income for the period that ended in June fell to 328.8 million pounds ($54 million) from 371.2 million pounds a year earlier, the company said today. Still, sales from all projects more than doubled to 2.42 billion pounds. The company is facing renewed court challenge to ownership of its biggest land asset, a 33-million square meter plot on the outskirts of Cairo, which it is using for a residential and business development called Madinaty.
“We believe they won’t be able to deliver the 8,000 to 10,000 units they forecast this year,” said Habiba Hegab, equity analyst at Cairo-based Pharos Holding. “The Madinaty court case is also expected to remain an overhang over sales in that project in the second half.”
An Egyptian panel of judges recommended last month the annulment of a revised contract that allowed the government to sell the land to Talaat Moustafa, an opinion the company said wasn’t binding. A court hearing will be held in November to examine appeals against a ruling by Egypt’s Administrative Court that the sale was legal.
First-half revenue declined to 2.39 billion pounds from 2.55 billion pounds a year earlier. The company didn’t give a reason for the drop. Jihad Sawaftah, Talaat’s chief financial officer, didn’t respond to a call and text message to his mobile phone seeking comment.
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