Solidere Quarterly 3 2012

quarterly
July-September 2012
2
BUSINESS & FINANCE
CHAIRMAN’S MESSAGE EXTRACTS
Adaptability, pro-activity and diligence are key principles that drive our business. Solidere is on
solid financial grounds and continues to deliver positive results as it remains focused on investment programs at home and abroad. Our strategy is to add value to our land bank and seek diversification through income-generating projects, geographic expansion and new business lines.
The Company reported net consolidated profits of US$158.8 million. The drop from the previous
year is due to a decrease in recognized land sales, US$242 million vs US$337 million in 2010,
however at a greater profit margin due to higher sale prices. Land sale transactions in the last
quarter of 2011, plus previous deals recognized during the year, represent 67,000 sq m in BUA.
Moving forward, investor interest, particularly in the Waterfront District, remains heightened,
based on future potential and a belief in the country’s positive medium and long-term prospects.
Waterfront District infrastructure and landscaping is to be completed within three to four years.
Zaitunay Bay launched its quayside restaurants, with the yacht club planned to open in 2013.
The district is a major destination for pedestrians, sports enthusiasts and outdoor family
recreation. Its appeal will increase after the opening of new projects. Beirut Souks’s number
of visitors has increased due to a communication strategy, the organization of festive events,
a regular stream of activities and cultural exhibits in its Venue. A further magnet of the Souks,
the Entertainment Complex with its 14 movie theaters is set to open in early 2013, and the
design of the Department Store is underway.
Solidere International achieved net profits of US$11 million and maintained financial strength
with no leverage and a cash balance of US$350 million. Investment efforts are focused on Saudi
Arabia, where it is currently involved in several residential projects and is in negotiation on two
others. In the UAE, Al Zorah is pushing through with infrastructure works, with the completion
of two marinas, the parkway, and the path to Emirates Road. Hazmieh Development in Lebanon
obtained authorities’ approval on the master plan. Solidere Homes, a new line of business for
private and public sector affordable housing, was established.
As we assess all these achievements, we remain diligent in steering Solidere forward and we
continue to appreciate the central role of our stakeholders in supporting our endeavors in making Beirut city center a place where people want to work, live, and visit.
Annual Report 2011
ANNUAL GENERAL MEETING
Held on July 30 in Biel, Solidere’s annual general meeting,
presided over by Chairman Nasser Chammaa and attended by shareholders, resolved to approve the audited
financial statements for 2011, showing a net profit of
about US$162 million after tax; approve the distribution
of dividends in the form of 25 cents per share held of
either class A or B, plus one share B for every fifty shares
held, to be distributed to all shareholders registered as at
August 14, 2012, the distribution to be effected starting
October 15, 2012; give the Chairman and members of the
Board of Directors the authorizations stipulated for in
Articles 158 and 159 of the Lebanese Commercial Code;
clear the Chairman and members of the Board of Directors of any liability for matters relating to the Company
management in 2011.
The general meeting elected board members for the next
three years term as follows: Nasser Chammaa, Mounir
Douaidy, Maher Beydoun, Basil Yared, Joseph Asseily,
Raphael Sabbagha, Oussama Kabbani, Makram Abboud,
Fadi Boustany, Raja Salameh and Maher Daouk. The
members of the Board of Directors re-elected Nasser
Chammaa as Chairman and General Manager, Maher
Beydoun and Fadi Boustany as Vice-Chairmen, Raphael
Sabbagha as Secretary General, and Mounir Douaidy
as General Manager.
Ernst & Young and Deloitte and Touche were assigned
by the General Assembly as external auditors.
SHARE PERFORMANCE | 3RD QUARTER 2012
SHARE A | DAILY CLOSING PRICES
PRICE
VOLUME
79,298
$15.0
80,000
$14.0
60,000
$13.0
40,000
$12.0
20,000
$11.0
0
July 2
July 31
August 29
September 28
SHARE B | DAILY CLOSING PRICES
PRICE
VOLUME
$15.0
80,000
$14.0
60,000
$13.0
40,000
$12.0
20,000
$11.0
0
July 2
July 31
August 29
Share price (US dollars)
September 28
Trading volume
Solidere shares continued their slow drift downwards, the geopolitical
instability in the region and locally continuing to affect investor sentiment. Volume was also subdued with most investors taking a wait-andsee attitude. In this regard, the US$12 price level proved to be a strong
support for the share in the market, as prices throughout the period
bounced back each time the market got close to that level. This comes as
the market recognizes the strong fundamentals of the Company, which is
expected to weather this temporary period of instability in the region.
Share A fluctuated between a low of US$12.54 and a high of US$14.10,
closing the quarter at US$12.61, a 4.25% decrease from the previous
quarter. Share B traded between a low of US$12.51 and a high of
US$14.01, closing at US$12.54, a 3.61% decrease from the previous
quarter.
Trading activity decreased during the quarter, with around 1.6 million
shares of both classes trading in the local market. GDRs traded
on the London Stock Exchange closed at around US$12.60, a 4.83%
decrease from the previous quarter.
4
REAL ESTATE
DEVELOPMENT
NORTH SOUKS
CONFERENCES & REPORTS
DEVELOPMENT NEWS
Construction works are in progress
in the Entertainment Complex, designed by Valode et Pistre (France).
Conceived as a mega entertainment
destination, it comprises 14 cinemas
with two VIP halls served by large
lounge and concession areas.
For the second consecutive year, Investor Relations hosted an Analyst Day on
July 12th, 2012 where a number of local,
regional, and international sell-side
analysts and brokers were invited to hear
from Solidere management an update
on the Company’s current operations,
new pipeline developments as well as an
overview of mid to long term strategies.
The presentation was followed by a Q&A
session and a tour of the BCC project site.
A total 393 projects representing close to 3 million sq m
BUA are in various stages of development.
At Allenby Street level, high-end
boutiques are previewed while the
L-shaped adjacent building will host
restaurants and cafés. Completion
is scheduled for beginning 2013.
The Department Store is under
design by Zaha Hadid Architects
(UK – Irak). Its completion is
scheduled for end of 2015.
Citigroup published an updated equity
coverage on the Company and FFA
Private Bank issued a flash note
following the event.
Solidere welcomed at its premises
representatives from investment funds,
research houses a nd other financial
institutions during the quarter.
STATUS
PROJECTS
BUA SQ M
Completed
Under restoration
Under construction
Awaiting permit
Under study
No activity
Awaiting submission
271
6
47
25
24
7
13
1,367,429
12,543
527,561
387,417
355,175
16,632
395,834
TOTAL
393
3,062,591
6
SHOPPING & LEISURE
CITY CENTER
NEWCOMERS
Bhar
Cavalli Café
Collins Cocktail Bar
Ecco
Fauchon
Gate of Beirut
Givenchy
Jamil Khansa
Leanna
Lola B
Pannier Gourmet
Rakan
Urguay Cocktail Bar
Vick Vanlian
OPENING SOON
Antoine Karam house Linen
Art Stone Boutique
Bvlgari
LH
Nanokeratin System
Robert Abi Nader
Tufenkjian
BEIRUT SOUKS
NEWCOMERS
Zahar Kids
OPENING SOON
Seascape Fall 2012, The Creative
Space, silent auction, August 23-30
Bensimon
BRGR Co.
Daniel Hechter
Gap
MAZ
Selamlique
Servane Gaxotte
Zahar Lingerie
BIEL
EVENTS
6:05 AT DEPECHEMODE
Makinat Lebanon, September 25-28
Harley Davidson, through July 8
Afkart, designers, July 11-15
8
POPE BENEDICT XVI’S VISIT
Lebanon was blessed by Pope
Benedict XVI’s visit with a peace
message for the region and a
special thought for Syria. His
Holiness celebrated mass on
Beirut Waterfront attended by a
large congregation, September 16.
« I PRAY IN PARTICULAR THAT
THE LORD WILL GRANT TO
THIS REGION OF THE MIDDLE
EAST SERVANTS OF PEACE
AND RECONCILIATION, SO
THAT ALL PEOPLE CAN LIVE
IN PEACE AND WITH DIGNITY »
POPE BENEDICT XVI
10
EXHIBITIONS
BEIRUT EXHIBITION CENTER
ZEITOUNEH SQUARE
Glasstress, Adriano Berenco,
from the 2011 Venice Biennale,
July 16 – September 2
Light at the end of the tunnel,
Nada Sehnaoui, installation,
September 12 – October 14
Angelika von Schwedes, paintings,
September 7 – October 14
12
EXHIBITIONS
THE VENUE
ALWANE
MARK HACHEM
VILLA ZEIN
Contemporary Art of Uruguay,
through July 8
AFAK 3, 18 young Lebanese artists,
curated by Razan Chatti, August 2-15
Spring-Summer in Lebanon,
through August 15
Summer-Fall in Lebanon,
through November 3
The other resurrection, July 6-21
Modern Masters works on paper,
September 20 – October 6
SOUK ARWAM/ AJAMI
AIDA CHERFAN
Lebanon in 3D, Jean-Claude Bejjani,
showcasing the third largest 3D
billboard in the world, August 22 –
September 22
Group show, through October 31
Opening Act, Nayef Francis,
July 17-28
Pakistani folk truck art exhibition and
workshop for adults, July 10-11, for
children, July 13
Lipanan, 36 Armenian and
Lebanese artists, curated
by Hamazkayin gallery,
September 11-16
AYYAM
PIÈCE UNIQUE
Melting Pot, July 4-31
Inner Self, Kais Salman,
September 20 – October 30
Murs Porteurs, Maya Hage,
through July 14
MAQAM
BOOKS, ETC.
BOOKSIGNINGS
CONFERENCES
ANTOINE ID
Solidere Angus Gavin was invited to:
Sustainable Development and Inclusive Growth for MENA Cities at the
Crossroads, a World Bank conference
in Marseilles, September 17-18
An Unfinished Odyssey, Cecil
Hourani, Antoine S.A.L.
Jasmine and Fire, a bittersweet year in
Beirut, Salma Abdelnour, Broadway
A Lebanese Perspective : Houses and
other work by Simone Kosremelli, part
of the Master Architect Series, Sylvia
Shorto, Images Publishing
LIBRAIRIE EL BOURJ
Sous les branches du grenadier,
May Menassa, Encre d’Orient,
July 20
Jaddati la tasmaani, Fatmeh Sharaf
Eddine, September 5, Dar al Saqi
VIRGIN MEGASTORE
Revolt in Syria, Stephen Starr,
Columbia University Press, August 1
Shal al Yasmin, poems by Johayna
el Awam, Amaluna Publishing,
September 19
INTERNATIONAL
Leggere le fotografie. In dodici lezioni,
Gabriele Basilico, Rizzoli
Common Pavilions, photography
by Gabriele Basilico was featured in
an installation by Diener & Diener,
13th architecture biennale (Venice)
August 29 – November 25
AWARDS
Nabil Gholam Architects is a recipient of the 2012 Green Good Design
Award in the Green Urban Planning/
Landscape Architecture category.
Solidere consultants Polypod won
the 2012-2013 Arabian Properties
Award for Architecture Multiple
Residence, September 10.
14
PERFORMING ARTS
BEIRUT HOLIDAYS
Man in the Mirror, August 19-22
Michel Fadel, August 23
Elissa, August 24
Sami Yusuf, August 25
BEIRUT WATERFRONT
Enrique Iglesias, July 4
Red Hot Chili Peppers, September 6
THE VENUE
Scheherazade in Baabda,
performed by women inmates,
directed by Zeina Daccache,
July 12-15
JAZZ FESTIVAL
Al-Madar with Toufic Farroukh
saxophone, September 27
Arturo Sandoval, September 28
Charlie Winston, September 29
16
VISITORS
OFFICIALS
BUSINESS DELEGATIONS
PROFESSIONALS & ACADEMICS
Left to right
New Spanish ambassadress Milagros
Hernando, Paraguay ambassador
Adela Jiménez de Pérez, City of
Paris department project manager
Mathilde Chaboche with architect
in chief Pascal Martin and general
inspector Laurence Pascalis, Henri
Castores new head of Economic
Section at the French Embassy,
Institut Français des Relations
Internationales (IFRI) president
Thierry de Montbrial with Riad
Tabet.
Karl Storz Endoscope international
chief consultant Markus Simmen,
East Mediterranean and Gulf
managing director Mohammad
Ali Jaber, marketing director Maher
el Hassan and marketing manager
Wassim Mohsen (Germany),
Società Italiana per condotte
d’acqua international operations
director Ernesto Guerrieri and
Vincenzo Speziali with Antoine
Habib (Italy), Siyah Group general
manager Adel Nadidh with
managing director Adnan Nahidh
(Irak), Faruk Group Holding CEO
Hawre Daro Noori with board
member Zarya Faruk Mustafa
and business development director
Qais Al Maskati (Kurdistan),
Networkers engineering CEO
Antoine Eddé (Switzerland), Candu
senior piping analyst Fouad Camille
Edde (Canada); Fourteen local,
regional and international financial
analysts, Rotary Club members.
UNDP research analyst Kassem
Diab, University of California Irvine
professor of Civil and Enviromental
Engineering Ayman Mosallam,
Cambridge University researcher
Jessica Holland, Columbia University
urban planning student Austin
Mkattaf (US), Bödeker Partners
landscape architect Eduard Gevers,
architect Jan Kendel (Germany),
architect engineer Alessio Paoletti
(Italy), three Jordanian architects.
AR Solh with ambassadors Jiménez
de Pérez and Milagros Hernando
MEDIA
Two journalists Stan Strasburger and
Rainer Merkel (Poland – Germany).
COPYRIGHT © 2012 SOLIDERE
The Lebanese Company for the Development and
Reconstruction of Beirut Central District s.a.l.
PO Box 119493 Beirut
2012 7305 Lebanon
Tel 961 1 980650 - 980660
Fax 961 1 980661 - 980662
solidere@solidere.com.lb
www.solidere.com
PHOTOGRAPHERS
Mosbah Assi | Ahmad Azakir | Rayya Haddad
Fares Jammal | Mazen Jannoun | Rachelle Tabet
David Xavier |