Qalaa Holdings, a leader in energy and infrastructure (CCAP.CA on the Egyptian Exchange), released today its consolidated financial results for the year ending 31 December 2022. The Group recorded a 113% y-o-y increase in revenue to EGP 97.7 billion in FY22, and recurring EBITDA of EGP 32.3 billion compared to EGP 4.1 billion in FY21. The solid performance reflects the success of Qalaa’s robust operational and growth strategies across its subsidiaries. ERC was the primary driver behind consolidated revenue growth, contributing c.76% to Qalaa’s total revenue in FY22. ERC’s refining margins were exceptionally high throughout FY22 and have started tapering towards normalized margins in 2023. At Qalaa’s bottom line, the Group recorded a net loss after minority of EGP 2.3 billion, in line with last year. The net loss came despite operational improvements, due to an FX loss of EGP 4.7 billion following the devaluation of the Egyptian pound.
Qalaa Holdings, a leader in energy and infrastructure (CCAP.CA on the Egyptian Exchange), released
today its consolidated financial results for the year ending 31 December 2022. The Group recorded a
113% y-o-y increase in revenue to EGP 97.7 billion in FY22, and recurring EBITDA of EGP 32.3
billion compared to EGP 4.1 billion in FY21. The solid performance reflects the success of Qalaa’s
robust operational and growth strategies across its subsidiaries. ERC was the primary driver behind
consolidated revenue growth, contributing c.76% to Qalaa’s total revenue in FY22. ERC’s refining
margins were exceptionally high throughout FY22 and have started tapering towards normalized
margins in 2023. At Qalaa’s bottom line, the Group recorded a net loss after minority of EGP 2.3
billion, in line with last year. The net loss came despite operational improvements, due to an FX loss
of EGP 4.7 billion following the devaluation of the Egyptian pound.
Excluding ERC, Qalaa’s revenue in 4Q22 grew to EGP 6.6 billion, up 44% y-o-y compared to 4Q21.
On a full year basis, revenue delivered a 33% y-o-y growth to EGP 22.9 billion in FY22, driven by
improved performances across all subsidiaries. TAQA Arabia’s revenue grew 25% y-o-y in 4Q22
reaching EGP 3.1 billion compared to EGP 2.5 billion in 4Q21. On a full-year basis, revenue grew to
EGP 10.7 billion from EGP 9.1 billion in FY21, an 18% y-o-y increase. Revenue growth was primarily
driven by a strong performance across all business lines. ERC’s gross refining margin improved
significantly to USD 4.9 million per day versus USD 1.8 million per day in the same quarter last year
on account of higher prices of refined petroleum products and improved operational efficiency. On a
full year basis, gross refining margins were also up, rising from USD 1.2 million per day in FY21 to
USD 4.5 million per day in FY22.
National Printing delivered a 33% y-o-y increase in revenue during 4Q22 as well as a 67% y-o-y
topline expansion in FY22 as it continued reaping 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 both the quarter as well as the full year.
Meanwhile, ASCOM delivered a 45% y-o-y increase in top-line to EGP 364.0 million in 4Q22. In FY
22, revenue was also up by 45% y-o-y, reaching EGP 1.4 billion supported by increased volume and
higher prices at GlassRock and ACCM.
At ASEC Holding revenue expanded 122% y-o-y in 4Q22 to EGP 1.5 billion, as well as 48% y-o-y in
FY22, to reach EGP 4.6 billion owing to a strong performance in the production segment, as well as
an EBITDA of EGP 450 million which was undermined to the tune of c.EGP 106 million due to the
hyperinflation calculation methodology in Sudan. Meanwhile, Dina Farms Holding’s revenue reached
EGP 346.1 million in 4Q22, up 33% y-o-y. Dina Farms Holding’s revenue was also up in full-year
terms, reaching EGP 1.3 billion in FY22, a 24% y-o-y increase. The company’s performance was backed by improved operations at Dina Farms and ICDP’s revenue benefiting from higher prices and
direct distribution strategy. Finally, Nile Logistics delivered a 95% y-o-y revenue increase to EGP
119.4 million in 4Q22, as well as a 47% y-o-y increase in revenue to EGP 370.8 million in FY22.
“I am exceedingly proud of Qalaa’s topline performance during the past year, which demonstrated
the Group’s resilience and ability to continue delivering solid results despite the difficult underlying
macroeconomic conditions,” said Qalaa Holdings’ Chairman and Founder Ahmed Heikal. “The
Group delivered a twofold year-on-year topline growth, coupled with a near seven-fold year-on-year
increase in EBITDA in the midst of an uncertain operating environment, thanks to our robust
investment and growth strategies across our portfolio companies.” Heikal continued.
“Across the board, our portfolio companies continue to demonstrate their ability to withstand pressure,
taking advantage of the new macroeconomic dynamics and reaping the rewards of Qalaa’s carefully
executed growth strategy. On that front, all of our business segments have recorded solid performances
throughout the past year, having successfully managed to capitalize on elevated oil prices, an increased
focus on local manufacturing and import substitution, and a portfolio structure that provides a strong
shield against devaluation pressures. As such, and despite the ongoing challenges, Qalaa’s outlook
remains bright” Heikal added.
“Finally, I would like to reiterate that the true value of Qalaa’s performing assets is masked due to the
adoption of international accounting standards, which account for assets at their historical cost and
adjust for impairments, while not taking into consideration any revaluation adjustments,” said Heikal.
Qalaa’s recurring EBITDA increased substantially in 4Q22 to EGP 10.5 billion compared to EGP 2.1
billion in 4Q21. As at year end, full-year recurring EBITDA reached EGP 32.3 billion compared to
EGP 4.1 million in FY21. Profitability was primarily supported by ERC’s positive performance during
the year.
Excluding ERC, Qalaa recorded a recurring EBITDA increase of 82% y-o-y up to EGP 931.1 in 4Q22
compared to EGP 511.8 million in 4Q21. For FY22, recurring EBITDA expanded by 101% y-o-y to
EGP 3.7 billion, driven by improved profitability across all the Group’s subsidiaries.
“I am very pleased with Qalaa’s impressive performance throughout the past year, despite a difficult
operating environment, on the back of strong broad-based growth across our portfolio,” said Hisham
El-Khazindar, Qalaa Holdings’ Co-Founder and Managing Director. “During the year, our energy
segment was able to deliver strong results, as TAQA Arabia continued to benefit from growing energy
demand across the board, from natural gas distribution to power generation, CNG, and fueling stations.
ERC witnessed record refining margins on the back of rising refined petroleum product prices. At our
mining and printing businesses, Qalaa’s position as an import substitute and export play has continued
to drive both consolidated growth, and valuable USD proceeds for the Group. Finally, our agriculture
and logistics segments have continued to deliver solid growth thanks in large part to their robust
investment fundamentals.”
“A key area of focus for us over the past period has been reducing our risk levels, primarily by
deleveraging and growing Qalaa’s cash flows. As a result, as of the first quarter of 2023 ERC has
become current on all of its due interest payments as scheduled. In parallel, significant strides are being made towards restructuring Qalaa’s holding level debt. However, progress on that front is slowed down
by the current local currency volatility. Finalizing debt restructuring at Qalaa Holdings remains a
priority, yet the process is slowed by the ongoing FX turbulence. Qalaa may settle some debt
obligations using selected assets, with the option of repurchasing these assets in the future.”
“Our performance in 2022 is a true testament to our resilience and our ability to react swiftly to
unprecedented challenges during a period of economic uncertainty. Looking forward, we are positive
the Group is well-positioned to continue delivering strong results across our diverse markets and areas
of operation,” concluded El-Khazindar.