Qalaa E : Holdings 1Q22 Business Review - Consolidated Results

1Q 2022 BUSINESS REVIEW

CAIRO, EGYPT: 30 June 2022

Qalaa Holdings Reports 1Q 2022 Results

•

•

•

•

•

•

•

•

•

•

•

•

•

•

•

	1Q 2022 Consolidated Income Statement Highlights
	Revenues
	EGP 18,681.6 mn
	vs. EGP 7,994.7 mn in 1Q21
	EBITDA*		Net Loss After Minority
	EGP 3,889.7 mn		EGP 584.1 mn
	vs. EGP 90.5 mn in 1Q21		vs. EGP 478.6 mn in 1Q21
	1Q 2022 Consolidated Income Statement Highlights (excluding ERC)
	Revenues
	EGP 4,972.5 mn
	vs. EGP 3,875.5 mn in 1Q21
	EBITDA*		Net Loss After Minority
	EGP 783.4 mn		EGP 1,304.6 mn
	vs. EGP 356.7 mn in 1Q21		vs. EGP 223.0 mn in 1Q21
QALAAHOLDINGS.COM	1

1Q 2022 BUSINESS REVIEW

CAIRO, EGYPT: 30 June 2022

Highlights from Consolidated Balance Sheet at 31 March 2022

Consolidated Assets	Consolidated Debt
EGP 99,672.5 mn	EGP 71,889.5 mn
At current book value vs. EGP 84,268.4 mn in FY21	Of which EGP 50,452.3 mn related to ERC

*Recurring EBITDA excludes one-off selling, general and administrative expenses

Qalaa Holdings, a leader in energy and infrastructure (CCAP.CA on the Egyptian Exchange, formerly Citadel Capital), released today its consolidated financial results for the first quarter ended 31 March 2022. The Group recorded a 134% y-o-y increase in revenues to EGP 18,681.6 million in 1Q22 and recurring EBITDA of EGP 3,889.7 million compared to EGP 90.5 million in 1Q21. The solid performance reflects the success of Qalaa's robust operational and growth strategies across its subsidiaries. Furthermore, improved refining margins at ERC along with a turnaround in market conditions and global surge in commodity prices, benefitted the Group's consolidated performance during the quarter.

To note, refining margins continued to improve in 1Q22 to average USD 2.7 million per day as a result of oil product price hikes and the Russo-Ukrainian war. Excluding ERC, Qalaa's revenues grew by 28% y-o-y to EGP 4,972.5 million in 1Q22 and recurring EBITDA increased more than two-foldyear-on-year to EGP 783.4 million in 1Q22. At Qalaa's bottom-line, the Group booked a net loss of EGP 584.1 million in 1Q22 compared to a net loss of EGP 478.6 million in the same quarter the previous year.

Financial and operational highlights follow, as do management's comments and overview of the performance of different business units. Full financials are now available for download at ir.qalaaholdings.com.

QALAAHOLDINGS.COM

2

QALAA HOLDINGS

CONSOLIDATED REVENUES

1Q22

		86%
	EGP 18,681.6 mn
	1%
1%	2%5%	5%
◼ Energy	◼ Agrifoods
◼ Cement	◼ T&L
◼ Packaging &	◼ Other
Printing

• Mining

REVENUE PROGRESSION

(EGP mn)

			6.18,681
	7,994
	7.
	1Q21		1Q22

RECURRING EBITDA

PROGRESSION (EGP mn)

7.3,889 5.90

1Q21 1Q22

1Q 2022 BUSINESS REVIEW

CAIRO, EGYPT: 30 June 2022

• Qalaa's consolidated revenues grew by 134% y-o-y to EGP 18,681.6 million in 1Q22, primarily driven by ERC's contribution.
  ERC's revenues increased over three-foldyear-on-year to EGP 13,709.1 million in 1Q22, constituting 73% of Qalaa Holdings' top line for the quarter. The performance was driven by a recovery in refined petroleum prices coupled with an increasing gross refining margin. Additionally, there were no slowdowns or shutdowns in operation during the quarter.
• Excluding ERC, Qalaa's revenues grew by 28% y-o-y to EGP 4,972.5 million in 1Q22, driven by improved performances across all its subsidiaries.
  TAQA Arabia's revenue grew 13% y-o-y during the quarter to EGP 2,308.7 million. Revenue growth was primarily driven by increased fuel sales at TAQA Marketing and further supported by higher power distribution volumes at TAQA Power as well as CNG stations expansions and CNG volume growth at TAQA Gas.
  National Printing delivered a 69% y-o-y top line increase in 1Q22 as it reaped the rewards of its new El Baddar state-of-the-art facility. Higher export volumes and an optimized pricing strategy at both Shorouk and Uniboard reflected positively on National Printing's results during the first quarter of the year. Meanwhile, ASEC Holdings' revenues reached EGP 1,001.3 million in 1Q22, up 46% y-o-y, driven by a strong performance at Al-Takamol Cement.
  Additionally, ASCOM delivered 24% y-o-ytop-line growth in 1Q22 to EGP 286.4 million supported by increased volumes and higher prices at ACCM. Dina Farms Holding's recorded EGP 275.8 million in revenues, up 9% y-o-y, driven by strong performance at ICDP characterized by increased sales volumes, lower return rates and zero discounts during the quarter. Finally, Nile Logistics Holding delivered a turnaround performance with revenues increasing 92% y-o-y to EGP 93.6 million in 1Q22.
• Qalaa's recurring EBTIDA increased substantially to EGP 3,889.7 million in 1Q22 compared to EGP 90.5 million in 1Q21. Profitability was primarily supported by ERC's positive performance during the quarter.
  ERC's gross refining margin continues to improve as a result of surges in refined petroleum prices and the effects of the Russo-Ukrainian war. It is also worth noting that ERC did not experience any slowdowns or shutdown days during the quarter.

QALAAHOLDINGS.COM

3

RECURRING EBITDA

PROGRESSION (Excluding

ERC) (EGP mn)

			4.783
	356
	7.

1Q21 1Q22

NET PROFIT PROGRESSION

(EGP mn)

6).(478

1).(584

1Q21 1Q22

QALAAHOLDINGS.COM

1Q 2022 BUSINESS REVIEW

CAIRO, EGYPT: 30 June 2022

Consolidated Recurring EBITDA Progression Chart* (EGP mn)

		Consolidated EBITDA				Consolidated EBITDA ex- ERC	3,890
													2,085
					762						750	1,205
329	290	303	328	367
	320	626	357
329	290	303	328	320	360	214	303	90	454	521	509	783

1Q19 2Q19 Q319 Q419 1Q20 2Q20 3Q20 Q420 1Q21 2Q21 3Q21 4Q21 1Q22

*ERC started operation in 1Q20

• Excluding ERC, Qalaa recorded a recurring EBITDA increase of 120% y- o-y to EGP 783.4 million in 1Q22, driven by improved profitability across all of the Group's subsidiaries.
  Qalaa's EBITDA excluding ERC was primarily driven by contributions from National Printing, ASEC Holding, as well as TAQA Arabia, which benefitted from higher volumes and capitalized on increased prices.
• Selling, general and administrative expenses (SG&A) recorded EGP 510.6 million in 1Q22, up 7% y-o-y, of which EGP 122.9 million are related to ERC.
• Depreciation and amortization expenses stood at EGP 1,192.8 million in 1Q22 up 12% y-o-y compared to EGP 1,068.4 million in 1Q21.
• Bank interest expense recorded EGP 1,102.2 million in 1Q22, up 29% y- o-y from the EGP 851.4 million recorded in 1Q21. The increase was attributed to additional loans at TAQA Arabia to fund its expansion plans.
• Qalaa Holdings recorded an FX loss of EGP 1,225.9 million in 1Q22 compared to a gain of EGP 17.4 million in 1Q21. The EGP-Dollar movement, which took place towards the end of 1Q22, resulted in a negative impact on dollar dominated debts and liabilities at Qalaa Holdings and its subsidiaries.
• Total impairments and write downs recorded EGP 7.6 million in 1Q22 down 36% y-o-y from EGP 11.8 million in 1Q21.
• Qalaa recorded provisions of EGP 277.3 million in 1Q22 compared to EGP 107.0 million in 1Q21. Unpaid interest on restructured loans accounted for the majority of the provisions, while the remaining amount was attributed to contract termination obligations, taxes and social insurance.
• Qalaa Holdings recorded a consolidated net loss after minority interest of EGP 584.1 million in 1Q22 compared to a net loss of EGP 478.6 million in 1Q21.
  Bottom line losses were driven by an FX loss following the EGP-Dollar movement, which impacted the dollar dominated debts and liabilities at Qalaa Holdings and its subsidiaries.

4

1Q 2022 BUSINESS REVIEW

CAIRO, EGYPT: 30 June 2022

• Qalaa's debt restructuring efforts at the holding level and at the remaining subsidiaries are progressing and remain a top priority for the
  Group. Additionally, ERC's negotiations with its lenders for a full debt restructuring are underway. In 1Q22, Nile Logistics underwent a restructuring and settled all its outstanding bank debt.
• Qalaa's consolidated debt, excluding ERC and ERC-related debt, stood at EGP 17.45 billion as of 31 March 2022 compared to EGP 12.99 as of 31 March 2021. In addition to the notable expansions at TAQA Arabia, which contributed to the increase in debt, the currency movement towards the end of 1Q22 had a significant impact on the valuation of the
  Group's foreign currency-denominated debt.

Debt Progression (EGP bn)

	55.00																																50.45
	50.00
	45.00
	40.00			November 2016: EGP floatation
Billion	35.00
30.00
EGP	25.00
																																17.45
	20.00
	15.00
	10.00
	5.00																																3.99
	0.00		Sep'2014	Dec'2014			Sep'2015	Dec'2015			Sep'2016	Dec'2016	Mar'2017		Sep'2017	Dec'2017	Mar'2018		Sep'2019	Dec'2019	Mar'2019		Sep'2019	Dec'2019			Sep'2020	Dec'2020			Sep'2021	Dec'2021
	Mar'2014	Jun'2014	Mar'2015	Jun'2015	Mar'2016	Jun'2016	Jun'2017	Jun'2018	Jun'2019	Mar'2020	Jun'2020	Mar'2021	Jun'2021	Mar'2022
		2014			2015			2016			2017			2018			2019			2020			2021		2022

All Others		ERC		QH SPVs related to financing ERC Shares

QALAAHOLDINGS.COM

5