El Sewedy Electric : ELSEWEDY ELECTRIC 3Q2022 Earnings Release

Q3 2022 EARNINGS RELEASE

Cairo | 14 November 2022

ELSEWEDY ELECTRIC Reports 9M 2022 Results; Records Double Digit Top-Line and Bottom-Line Growth of 53.0% and 34.8% Respectively, Despite Ongoing Economic Headwinds

9M 2022 Consolidated Financial Highlights

Revenues		Gross Profit		EBITDA		Net Profit after Minority
EGP 62,572 million		EGP 8,457 million		EGP 6,127 million		EGP 3,092 million
▲ 53.0% y-o-y		▲ 51.7% y-o-y		▲ 44.5% y-o-y		▲ 34.8% y-o-y
Q3 2022 Financial Highlights
Revenues		Gross Profit		EBITDA		Net Profit after Minority
EGP 23,608 million		EGP 3,204 million		EGP 2,346 million		EGP 1,205 million
▲ 58.7% y-o-y		▲ 77.4% y-o-y		▲ 78.7% y-o-y		▲ 71.2% y-o-y

ELSEWEDY ELECTRIC (SWDY.CA on the Egyptian stock exchange), the leading Wires & Cables and Integrated Energy Solution Provider in the Middle East and Africa, announces its consolidated financial results for the nine-month period of 2022, with revenues growing by 53.0% year-on-year to record EGP 62,572 million. The company's net profit after minority interest came in at EGP 3,092 million in 9M 2022, up by 34.8% year-on-year and translating to a net profit margin of 4.9%. On a quarterly basis, Elsewedy Electric reported revenues of EGP 23,608 million in Q3 2022, an increase of 58.7% year-on-year, with a net profit after minority interest of EGP 1,205 million, growing by a significant 71.2% year-on-year and representing a net profit margin of 5.1%.

Note from Our CEO

As the third quarter of the year comes to an end, we have yet again delivered exceptional results with double-digit top line and bottom-line growth, supported by strong performance across all our business segments. The results are a demonstration of our ability to power through economic instability, be it on the local or global level. I am extremely happy with the growth we have achieved on both the financial and operational fronts, which is supported by our robust financial structure, efficient cost optimization measures, as well as a healthy and stable balance sheet.

Despite the ongoing geopolitical and economic volatility, our highly diversified business model continues to efficiently drive successful operations, rooted in strategic planning and implementation by our seasoned management. We continue to leverage the benefits of our geographical footprint and diversity in providing foreign currency income, which helps us capitalize on sustainable business practices to further expand our reach and complement our growth model.

Elsewedy Electric's main priority is to focus on sustainable projects and operations, as we fulfil our role in driving a greener economy. As a testament to our unwavering commitment, we are extremely proud to have contributed to the 27th United Nations Climate Change Conference (COP27) this November paving the way in transforming Sharm El-Sheikh into a green city. Looking ahead, we have partnered up with the Egyptian government to implement more low-carbon projects and hope that Elsewedy Electric continues to be at the forefront of developing sustainable activities across Egypt and our markets.

Ahmed El Sewedy

ELSEWEDY ELECTRIC | EARNINGS RELEASE

1

Q3 2022 EARNINGS RELEASE

Cairo | 14 November 2022

Summary Income Statement

EGP (000)'s	Q3-2022	Q3-2021	% Change	9M-2022	9M-2021	% Change
Revenue	23,608,095	14,874,406	58.7%	62,572,409	40,886,903	53.0%
Wires & Cables	11,272,057	7,440,382	51.5%	30,219,762	20,264,667	49.1%
Turnkey Projects	9,857,279	6,048,413	63.0%	26,057,452	16,632,837	56.7%
Meters	1,056,095	470,801	124.3%	2,787,616	1,758,036	58.6%
Transformers	972,395	628,441	54.7%	2,383,304	1,431,085	66.5%
Electrical Products	345,723	194,753	77.5%	820,242	527,537	55.5%
Renewables - IPP	104,545	91,616	14.1%	304,033	272,740	11.5%
Gross Profit	3,203,980	1,806,439	77.4%	8,456,827	5,575,941	51.7%
Wires & Cables	1,522,572	728,478	109.0%	4,004,099	2,272,052	76.2%
Turnkey Projects	906,414	739,267	22.6%	2,701,476	2,111,272	28.0%
Meters	303,336	120,856	151.0%	760,947	513,623	48.2%
Transformers	234,987	90,732	159.0%	394,889	311,277	26.9%
Electrical Products	177,772	81,269	118.7%	423,956	233,588	81.5%
Renewables - IPP	58,899	45,836	28.5%	171,459	134,130	27.8%
Gross Profit Margin	13.6%	12.1%		13.5%	13.6%
EBITDA	2,345,711	1,312,314	78.7%	6,127,428	4,239,474	44.5%
EBITDA Margin	9.9%	8.8%		9.8%	10.4%
Net Income After Minority	1,204,704	703,857	71.2%	3,092,069	2,293,451	34.8%
Net Income After Minority Margin	5.1%	4.7%		4.9%	5.6%

Financial and Operational Highlights

• Elsewedy Electric reported revenues of EGP 23,608 million in the third quarter of the year, up by 58.7% y-o-y, supported by strong performance across all of the company's business segments with major contribution coming from both cables and turnkey projects segments.
• Gross Profit grew by almost two-fold to reach EGP 3,204 million in Q3 2022 against the EGP 1,806 million recorded in the previous year, driven by improved profitability across all segments supported by management's strategic planning in efforts to mitigate inflationary pressures, coupled with the currency movement effect.
• SG&A expenses came in at EGP 1,216 million at the end of the third quarter of the year, growing by 57.9% y-o-y, on the back of rising inflation due to ongoing local and global market challenges, coupled with the currency movement effect. Further, growth in SG&A expenses was also driven by an increase in personnel costs, as well as new hiring across different departments. It is worthy to note that SG&A expenses as a percentage of revenues remained unchanged y-o-y at 5.2%, reflecting the company's efficient operational model.
• The company's EBITDA recorded EGP 2,346 million in Q3 2022, up by 78.7% y-o-y driven by improved profitability margins on the back of implementing efficient cost control measures, coupled with higher revenues generated during the period. As a result, the corresponding EBITDA margin recorded 9.9% in Q3 2022, an increase of 1.1 pp y-o-y.
• Net Income after Minority Interest expanded by a notable 71.2% y-o-y coming in at EGP 1,205 million in Q3 2022, with the increase in profitability across company's operating segments offsetting the rising SG&A expenses and financing costs. Net profit margin for the period came in at 5.1% against the 4.7% reported in the previous year.
• Elsewedy Electric's net debt stood at EGP 14,754 million as of 30 September 2022 versus a net debt position of EGP 6,116 million recorded at the end of 2021. Growth in net debt position was largely driven by the management's strategic decision

ELSEWEDY ELECTRIC | EARNINGS RELEASE

2

Q3 2022 EARNINGS RELEASE

Cairo | 14 November 2022

to stockpile key raw materials in an effort to mitigate supply chain disruptions caused by the prevailing economic conditions. The increase was further driven by higher capital expenditure in line with the company's expansion plans.

• Inventory came in at EGP 19,934 million as of 30 September 2022, growing by 49.6% year-to-date as the company continues to stock up on raw materials to hedge against anticipated supply shortages.
• Accounts receivable stood at EGP 21,036 million as of 30 September 2022, up by 39.8% year-to-date versus the EGP 15,043 million recorded at year-end 2021, whereas accounts payable increased by 10.3% to book EGP 9,569 million as of 30 September 2022.

Financial and Operational Review

Revenues continued on an upward trajectory growing by 58.7% y-o-y to reach EGP 23,608 million in Q3 2022 driven by strong growth across all business segments, with the wires & cables and turnkey segments contributing 90% to total revenue during the period.

Revenue by Segment		Revenue by Segment
(Q3 2022)			(Q3 2021)
	1% 0.4%				1% 1%
4%				3%	4%
4%
EGP 23.6 bn	48%		EGP 14.9 bn	50%
42%				41%
Wires & Cables	Turnkey			Wires & Cables		Turnkey
		Meters		Transformers
Meters	Transformers
	Electrical Products	Renewables - IPP
Electrical Products	Renewables - IPP

• Wires and cables came in as the first-largest contributor to consolidated revenues, growing by 51.5% y-o-y to reach EGP 11,272 million and contributing 48% to total revenues.
• Turnkey projects contributed 42% to consolidated revenues, recording EGP 9,857 million in Q3 2022, reflecting a y-o-y increase of 63.0%. The segment's backlog reached EGP 86.9 billion with the majority of projects concentrated in Egypt.
• Meters revenues registered EGP 1,056 million during the period, reflecting an impressive growth of more than two-fold on the back of a pick-up in volumes. The segment contributed 4% to total revenues in Q3 2022, compared to a contribution of 3% in the previous year.
• The Transformers segment saw its revenues rise by 54.7% y-o-y coming in at EGP 972 million and contributing 4% to the
  Group's revenues. Growth in the segment was supported by improved performance on the back of better pricing with a promising return on investment from the Indonesian plant.
• Other electrical products reported revenues of EGP 346 million, up by 77.5% y-o-y and contributing 1% to consolidated revenues.
• The Renewables segment contributed 0.4% to consolidated revenues recording EGP 105 million, an increase of 14.1% y-o-y.

The Group's Gross Profit reported a significant increase by 77.4% y-o-y to reach EGP 3,204 million in Q3 2022, primarily due to strong growth across all business segments, coupled with effective strategic planning focused on profitability and optimization. As a result, gross profit margin for the period came in at 13.6% versus 12.1% recorded by the end of the third quarter of 2021.

ELSEWEDY ELECTRIC | EARNINGS RELEASE

3

Q3 2022 EARNINGS RELEASE

Cairo | 14 November 2022

Gross Profit by Segment		Gross Profit by Segment
(Q3 2022)			(Q3 2021)
6% 2%				4% 3%
7%				5%
				7%
9%					40%
EGP 3.2 bn	48%		EGP 1.8 bn
28%				41%
Wires & Cables	Turnkey		Wires & Cables	Turnkey
Meters	Transformers		Meters	Transformers
Electrical Products	Renewables - IPP		Electrical Products	Renewables - IPP

• The Wires and cables segment maintained its position as the largest contributor to total gross profit at 48% in Q3 2022, an increase from 40% in the third quarter of last year. Gross profit for the segment came in at EGP 1,523 million, a remarkable increase of 109.0% y-o-y.
• Turnkey projects contributed 28% to consolidated gross profit, with an absolute gross profit of EGP 906 million, growing by 22.6% during the period, versus EGP 739 million in Q3 2021
• The Meters segment saw its gross profit increase significantly by 151.0% y-o-y to record EGP 303 million, with a contribution of 9% to the Group's total gross profit.
• Transformers' gross profit came in at EGP 235 million, an increase of 159.0% y-o-y, with a contribution to consolidated gross profit of 7%.
• Other electrical products reached EGP 178 million, growing by 118.7% y-o-y, and yielding a contribution of 6% to total gross profit.
• Gross profit generated by the Renewables segment grew by 28.5% y-o-y, coming in at EGP 59 million, and contributing 2% to total gross profit.

Segment Review

Wires and Cables

Q3-2022Q3-2021% Change 9M-20229M-2021% Change

Revenues Before Intercompany Sales (EGP 000's)	14,875,986	9,306,723	59.8%	39,667,930	25,919,072	53.0%
Revenues After Intercompany Sales (EGP 000's)	11,272,057	7,440,382	51.5%	30,219,762	20,264,667	49.1%
Gross Profit (EGP 000's)	1,522,572	728,478	109.0%	4,004,099	2,272,052	76.2%
GP Margin Before Intercompany Sales	10.2%	7.8%		10.1%	8.8%
GP Margin After Intercompany Sales	13.5%	9.8%		13.2%	11.2%
Cables Sales Volumes (Tons)	37,120	31,885	16.4%	106,367	99,130	7.3%
Cables Gross profit per ton (EGP)	28,483	16,273	75.0%	25,450	15,719	61.9%

ELSEWEDY ELECTRIC | EARNINGS RELEASE

4

Wires & Cables Revenue and Profitability

13.5% 11.9% 12.7% 10.6%

9.8% 13.5%

23.6	21.5	18.5	29.6			7.4		11.3
2018	2019	2020	2021	Q3 2021	Q3 2022
		Revenues (bn)				GP Margin

Cables Backlog

(As of 30 September 2022)

EGP 9.9 bn

Turnkey Projects and Awards

Turnkey Revenue and Profitability

18.0%	19.9%	13.9%	14.5%
						12.2%
										9.2%
13.2	19.1	22.7	25.4			6.0		9.9
2018	2019	2020	2021	Q3 2021	Q3 2022
		Revenues (bn)				GP Margin

Q3 2022 EARNINGS RELEASE

Cairo | 14 November 2022

• Wires and Cables' revenues reported for the third quarter of 2022 amounted to EGP 11,272 million, climbing 51.5% compared to the EGP 7,440 million recorded one year previously. Growth in revenues is driven by enhancement in the segment's overall performance, which has seen volumes increase by 16.4% y-o-y to reach 37,120 tons in Q3 2022, coupled with price increase and positive currency movement effect.
• The segment's gross profit came in at EGP 1,523 million in Q3 2022, climbing significantly by 109.0% y-o-y, on the back of management's successful implementation of an inventory stockpiling strategy, combined with the impact of favourable currency movements and efficient cost control, that has led to the segment's improved profitability.
• As a result, gross profit margin grew by 3.7 pps y-o-y coming in at 13.5% in the third quarter of the year against 9.8% recorded in the previous year.
• The segment's backlog stood at EGP 9.9 billion as of 30 September 2022, showcasing the segment's positive outlook.
• Turnkey projects saw its revenues reach EGP 9,857 million at the end of the third quarter of 2022, growing by 63% y-o-y and contributing 42% to total revenues. Growth in revenues was driven by a ramp up in the projects under execution in Tanzania and Egypt.
• The segment's backlog recorded EGP 86.9 billion as of
  30 September 2022, with 74% of the projects located in Egypt.
• Newly awarded projects for Q3 2022 reached EGP 20.9 billion driven by an increase in civil and network, as well as transmission and distribution projects in Egypt. Total new awards as of September 2022 reached EGP 36.2 billion.
• The segment's gross profit grew by 22.6% y-o-y amounting to EGP 906 million on the back of the currency movement effect while gross profit margin fell by 3.0 pp y-o-y to record 9.2% driven by project mix profitability.

ELSEWEDY ELECTRIC | EARNINGS RELEASE

5