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    CCAP   EGS73541C012

QALAA HOLDINGS S.A.E.

(CCAP)
  Report
End-of-day quote Egyptian Exchange  -  2022-11-23
1.373 EGP   -0.29%
10/10Qalaa E : 2Q2022 Investor Presentation
PU
09/29Qalaa Holdings S.A.E. Reports Earnings Results for the Second Quarter and Six Months Ended June 30, 2022
CI
09/29Qalaa E : Holdings 2Q22 Business Review - Consolidated Results
PU
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Qalaa E : Holdings 2Q22 Business Review - Consolidated Results

09/29/2022 | 02:44am EST

2Q 2022 BUSINESS REVIEW

CAIRO, EGYPT: 28 September 2022

Qalaa Holdings Reports 2Q 2022 Results

2Q 2022 Consolidated Income Statement Highlights

Revenue

EGP 26,981.2 mn

vs. EGP10,172.4 mn in 2Q21

EBITDA*

Net Income After Minority

EGP 9,024.5 mn

EGP 361.6 mn

Vs. EGP 750. mn in 2Q21

vs. EGP (401.5) mn in 2Q21

2Q 2022 Consolidated Income Statement Highlights (excluding ERC)

Revenue

EGP 5,508.2 mn

vs. EGP 4,158.1 mn in 2Q21

QALAAHOLDINGS.COM

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2Q 2022 BUSINESS REVIEW

CAIRO, EGYPT: 28 September 2022

EBITDA*

Net Loss After Minority

EGP 931.7 mn

EGP 516.6 mn

vs. EGP 454.2 mn in 2Q21

vs. EGP 258.3 mn in 2Q21

Highlights from Consolidated Balance Sheet at 30 June 2022

Consolidated Assets

Consolidated Debt

EGP 106,141.5 mn

EGP 70,684.7 mn

At current book value vs. EGP 84,268.4 mn in FY21

Of which EGP 48,059.8 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 quarter ending 30 June 2022. The Group recorded a 165% y-o-y increase in revenue to EGP 26,981.2 million in 2Q22, and recurring EBITDA of EGP 9,024.5 million compared to EGP 750.0 million in 2Q21. The strong performance reflects the success of Qalaa's robust operational and growth strategies across its subsidiaries. Furthermore, improved refining margins at ERC along with a global surge in commodity prices benefitted the Group's consolidated performance during the quarter.

It is worth noting that ERC's refining margins continued to improve in 2Q22 to average USD 5.4 million per day as a result of oil product price hikes and the Russo-Ukrainian war. Excluding ERC, Qalaa's revenue grew by 32% y-o-y to EGP 5,508.2 million in 2Q22 and recurring EBITDA increased more than two-foldyear-on-year to EGP 931.7 million in 2Q22.

At Qalaa's bottom-line, the Group returned to profitability booking a net income of EGP 361.6 million in 2Q22 compared to a net loss of EGP 401.5 million in the same quarter last 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

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2Q 2022 BUSINESS REVIEW

CAIRO, EGYPT: 28 September 2022

QALAA HOLDINGS

Qalaa's consolidated revenue grew by 165% y-o-y to EGP 26,981.2

CONSOLIDATED REVENUE

million in 2Q22, primarily driven by ERC's contribution.

2Q22

89%

EGP 26,981.2 mn

1%

1%

4% 4%

Energy

Agrifoods

Cement

T&L

Packaging &

Other

Printing

  • Mining

REVENUE PROGRESSION

(EGP mn)

4.10,172

2.26,981

18,167

8.45,662

1.

2Q21 2Q22

1H21 1H22

ERC's revenue increased three-foldyear-on-year to EGP 21,473.0 million in 2Q22, constituting 80% of Qalaa Holdings' top line for the quarter. The performance was driven by a recovery in prices of refined petroleum products and an increasing gross refining margin. Additionally, there were no slowdowns or shutdowns in ERC's operation during the quarter.

  • Excluding ERC, Qalaa's revenue grew by 32% y-o-y to EGP 5,508.2 million in 2Q22, driven by improved performances across all its subsidiaries.
    TAQA Arabia's revenue grew 13% y-o-y during the quarter to EGP 2,478.6 million. Revenue growth was primarily driven by a strong performance at TAQA Petroleum and further supported by higher power distribution volume at TAQA Power and volume growth at TAQA Gas.
    National Printing delivered a 99% y-o-y top line increase in 2Q22 as it reaped the rewards of its new El Baddar state-of-the-art facility. Additionally, higher volume and an optimized pricing strategy at both Shorouk and Uniboard reflected positively on National Printing's results during the quarter. Meanwhile ASCOM delivered a 57% y-o-y increase in top-line to EGP 354.8 million in 2Q22, supported by higher export proceeds at ACCM as well as increased volume and higher prices at GlassRock.
    At ASEC Holding revenue increased 45% y-o-y to EGP 1,083.9 million in 2Q22, driven by a strong performance at Al-Takamol which accounted for 79% of total revenue. And at Dina Farms' holding company, revenue reached EGP 343.0 million in 2Q22, up 13% y-o-y as facility enhancement improved operations at Dina Farms and ICDP's volumes benefitted from its direct distribution strategy. Finally, Nile Logistics delivered a 6% y-o-y increase in revenue to EGP 67.9 million in 2Q22.
  • Qalaa's recurring EBTIDA increased substantially to EGP 9,024.5 million in 2Q22 compared to EGP 750.0 million in 2Q21. Profitability was primarily supported by ERC's positive performance during the quarter.
    ERC's gross refining margin improved significantly versus last year on account of higher prices of refined petroleum products.

QALAAHOLDINGS.COM

3

RECURRING EBITDA

PROGRESSION (EGP mn)

3.12,914

0.750

5.9,024

5.840

2Q21 2Q22

1H21 1H22

RECURRING EBITDA

PROGRESSION (Excluding

ERC)

(EGP mn)

1.1,715

7.931

9.810

454

2.

2Q21 2Q22

1H21 1H22

NET PROFIT PROGRESSION

(EGP mn)

6.361

5).(401

.(880

6).(222

1)

2Q21 2Q22

1H21 1H22

QALAAHOLDINGS.COM

2Q 2022 BUSINESS REVIEW

CAIRO, EGYPT: 28 September 2022

Consolidated Recurring EBITDA Progression Chart* (EGP mn)

Consolidated EBITDA

Consolidated EBITDA ex- ERC

9,025

3,890

2,085

329

290

303

328

722

328

320

626

357

750

1,205

783

932

510

320

360

182

253

90

454

521

1Q19 2Q19 Q319 Q419 1Q20 2Q20 3Q20 Q420 1Q21 2Q21 3Q21 4Q21 1Q22 2Q22 *ERC started operation in 1Q20

Excluding ERC, Qalaa recorded a recurring EBITDA increase of 105% y- o-y to EGP 931.7 million in 2Q22, driven by improved profitability across most of the Group's subsidiaries.

Qalaa's EBITDA excluding ERC was primarily driven by contributions from TAQA, National Printing and Cement. Additionally, ASCOM's export driven businesses delivered a strong performance as they capitalized on their competitive advantage in global markets, with higher volume at ACCM and improved pricing at GlassRock.

  • Depreciation and amortization expenses stood at EGP 1,333.6 million in 2Q22, up 23% y-o-y compared to EGP 1,086.6 million in 2Q21, of which EGP 1,089.4 million are related to ERC. The year-on-year increase is primarily due to the depreciation of the Egyptian Pound in March 2022.
  • Bank interest expense recorded EGP 1,140.6 million in 2Q22, up 25% y-o-y versus the EGP 910.2 million recorded in 2Q21. The increase was attributed to higher interest rates in addition to the increase of loans at TAQA Arabia to fund its expansion plans.
  • Qalaa recorded an FX loss of EGP 89.9 million in 2Q22 compared to a gain of EGP 54.9 million in 2Q21. The depreciation of the Egyptian Pound, which took place in late March 2022, was the main reason for such FX loss due to the predominantly dollar denominated debts at Qalaa Holdings and ERC.
  • Qalaa Holdings recorded a consolidated net income after minority interest of EGP 361.6 million in 2Q22 compared to a net loss of EGP
    1. million in 2Q21. Qalaa's net income was driven by strong profitability at ERC.
  • Excluding ERC, Qalaa recorded an EGP 516.6 million net loss after minority in 2Q22 versus EGP 258.3 million in 2Q21 on the back of EGP
    1. million in FX losses booked in 2Q22 compared to an FX gain of EGP 55.6 million in 2Q21. Also, taxes went up to EGP 170.0 million in 2Q22 from EGP 49.3 million in 2Q21. Moreover, minority interest was EGP 275.7 million in 2Q22 versus only EGP 63.4 million in 2Q21.

4

2Q 2022 BUSINESS REVIEW

CAIRO, EGYPT: 28 September 2022

  • Qalaa's debt restructuring efforts at the holding level are progressing and remain a top priority for the Group. Additionally, ERC's negotiations with its lenders for a full debt restructuring are underway.
  • Qalaa's consolidated debt, excluding ERC and ERC-related debt, stood at EGP 18.5 billion as of 30 June 2022 compared to EGP 15.06 billion as of 30 June 2021. The increase was partially driven by TAQA Arabia to fund its expansion plans. Meanwhile at ERC, the company paid USD 202.5 million in principal payments and USD 45.0 million in interest expenses in 2Q22, with a plan to settle more debt during 2022.

Debt Progression (EGP bn)

55.00

All Others

ERC

QH SPVs related to financing ERC Shares

50.00

48.06*

45.00

November 2016: EGP floatation

40.00

35.00

Billion

30.00

EGP

25.00

20.00

18.48

15.00

10.00

5.00

4.15

0.00

Sep'2014

Dec'2014

Jun'2015 Sep'2015 Dec'2015 Mar'2016

Jun'2016 Sep'2016

Dec'2016 Mar'2017

Sep'2017

Dec'2017

Jun'2018 Sep'2019

Dec'2019 Mar'2019

Jun'2019 Sep'2019

Dec'2019

Jun'2020 Sep'2020

Dec'2020

Jun'2021 Sep'2021

Dec'2021

Mar'2014

Jun'2014

Mar'2015

Jun'2017

Mar'2018

Mar'2020

Mar'2021

Mar'2022

Jun'2022

2014

2015

2016

2017

2018

2019

2020

2021

2022

*Cash balances of EGP 912.0 million and EGPC receivables of EGP 7.4 billion were not offset from the debt

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 29 September 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 29 September 2022 06:43:02 UTC.


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Financials
Sales 2021 45 826 M 1 864 M 1 864 M
Net income 2021 -2 278 M -92,7 M -92,7 M
Net Debt 2021 63 857 M 2 598 M 2 598 M
P/E ratio 2021 -0,96x
Yield 2021 -
Capitalization 3 956 M 161 M 161 M
EV / Sales 2020 1,79x
EV / Sales 2021 1,47x
Nbr of Employees 32 000
Free-Float 61,6%
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Number of Analysts 2
Last Close Price 1,37 EGP
Average target price 1,64 EGP
Spread / Average Target 19,1%
Managers and Directors
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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