• Qalaa’s consolidated revenue grew 113% y-o-y to EGP 97.7 billion in FY22 and recurring EBITDA reached EGP 32.3 billion compared to EGP 4.1 billion in FY21, supported by record refining margins at the Egyptian Refining Company (ERC) and strong performances across all subsidiaries;
  • In FY22, Qalaa recorded a net loss of EGP 2.3 billion on par with the previous year, despite operational improvements, due to an FX loss of EGP 4.7 billion following the devaluation of the Egyptian pound;
  • 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.
  • Excluding ERC, Qalaa’s revenue grew by 33% y-o-y and recurring EBITDA increased by 101% y-o-y in FY22, driven by positive performances across Qalaa’s subsidiaries;
  • TAQA Arabia’s solid topline results were primarily driven by a strong performance across all business lines: gas distribution, electricity generation and distribution, petroleum products distribution and water treatment;
  • ASEC Holdings delivered a 48% y-o-y revenue growth on the back of strong topline results at ASEC Cement during FY22;
  • National Printing saw improved volumes and benefitted from higher prices at all its companies. El Baddar continued to capitalize on its new cutting-edge facility, while Shorouk for Modern Printing and Packaging witnessed higher export volume and an increased average price per ton;
  • ASCOM’s growth was driven by volume and price expansion at GlassRock and ASCOM for Chemicals & Carbonates Manufacturing (ACCM);
  • Dina Farms Holding’s revenue grew y-o-y as ongoing facility enhancement projects continue to improve operations at Dina Farms and its manufacturing subsidiary; ICDP benefits from its direct distribution strategy, as well as improved pricing;
  • The Group’s export proceeds recorded c. USD 22.1 million in 4Q22 compared to USD 25.0 million in 4Q21. Full-year proceeds were USD 123.4 million compared to USD 95.5 million in FY21. Whereas local foreign currency revenue recorded c. USD 927 million in 4Q22 vs. USD 680.3 million in 4Q21 and USD 3.9 billion in FY22 compared to USD 1.19 billion in FY21. Moving forward, the Group will continue focusing on exports and leverage the cost advantage available to local manufacturers;
  • Despite ERC’s receivables from EGPC having reached USD 618.2 million as of 31 December 2022, EGPC continues to make enough payments enabling ERC to exceed mandatory debt repayments, including its upcoming debt repayment that is set for June 2023;
  • 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;
  • Qalaa has been resilient despite highly challenging macroeconomic conditions. The Group will continue driving growth by making small incremental investments in its subsidiaries, expanding cashflows, thereby reducing debt to cash flow ratios. Management is confident this strategy will continue to deliver;
  • Furthermore, Qalaa is currently studying several new medium-sized, export oriented, predominantly green, and high local value-added investments, to be executed through its subsidiaries;
  • Qalaa’s Sudan based staff and assets are safe and Qalaa continues to closely monitor the ongoing developments within the country.

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.

Previous Qalaa Holdings press releases on this subject and others may be viewed online from your computer, tablet or mobile device at qalaaholdings.com/newsroom