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    CCAP   EGS73541C012

QALA FOR FINANCIAL INVESTMENTS

(CCAP)
  Report
End-of-day quote Egyptian Exchange  -  2023-02-07
1.960 EGP   -3.92%
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Qalaa E : Holdings 1Q22 Business Review - Consolidated Results

06/30/2022 | 05:33pm EST

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

This is an excerpt of the original content. To continue reading it, access the original document here.

Disclaimer

Qalaa Holdings SAE published this content on 30 June 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 30 June 2022 21:32:10 UTC.


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Financials
Sales 2022 90 611 M 2 984 M 2 984 M
Net income 2022 -1 093 M -36,0 M -36,0 M
Net Debt 2022 - - -
P/E ratio 2022 -3,27x
Yield 2022 -
Capitalization 4 788 M 158 M 158 M
Capi. / Sales 2022 0,05x
Capi. / Sales 2023 0,05x
Nbr of Employees 32 000
Free-Float 61,6%
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Number of Analysts 2
Last Close Price 1,96 EGP
Average target price 2,11 EGP
Spread / Average Target 7,65%
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Hisham Hussein El-Khazindar Managing Director & Executive Director
Moataz Farouk Mohammed Ayad Chief Financial Officer & Executive Director
Ahmed Mohammad Hassanein Heikal Chairman
Ramy Barsoum Head-Information Technology
Ahmed Abd El-Sattar Group Chief Information & Innovation Officer
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