Reuters Middle East
by Aziz El Yaakoubi
Addoha, Morocco’s biggest property developer by market value, reported a 1 percent rise in first-half net profit as it cut debt and bolstered its cashflow.
The company said it made a net profit of 614 million Moroccan dirham ($63.4 million) while consolidated revenue rose by 0.5 percent to 3.38 billion dirhams.
After a 40 percent drop in profit in 2014, Addoha launched a plan to reduce its debt and regenerate its cashflow by selling lands and properties.
Total debt fell 11 percent to 8.3 billion dirhams in the first six months of 2015, it said. Operating cashflow rose 202 percent to 1.7 billion dirhams, it added.
Addoha shares have lost around 50 percent of their value in the past 12 months, data compiled by Reuters showed. They rose 1.5 percent to 25.5 dirhams on Wednesday after the results announcement.
The company sold 9,063 properties in the first six months of the year, down from 9,641 in the same period of last year, with 71 percent of its sales revenues coming from low-income housing encouraged by the government through tax breaks.
The government has been striving to build low-income housing developments in an attempt to stop the spread of slums, mainly in the city of Casablanca. But under pressure to cut deficits, it has been reducing its spending in the last two years, putting pressure on housebuilders’ margins.
(Reporting by Aziz El Yaakoubi; Editing by Jason Neely and Pravin Char)
