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Tuesday, 17 May 2022

EKH reports record net income in 1Q2022

Egypt Kuwait Holding (EKH) reported record quarterly earnings in 1Q 2022 as the surge in commodity prices boosted revenues, the company said in its latest earnings release (pdf). Net income rose 66% y-o-y to USD 71.1 mn during the quarter, underpinned by strong revenue growth in fertilizers and petrochemicals which resulted in the company’s top line growing 52% to USD 291.2 mn.

The commodities squeeze was good to EKH last quarter: The company’s fertilizer and petrochemicals segment saw 58% y-o-y revenue growth, driven by rising prices and higher production volumes. Meanwhile, EKH’s North Sinai natural gas concession, ONS, saw revenues rise 12% y-o-y on the back of higher volumes and natural gas prices.

What they said: “With an integrated presence across the entire energy value chain … our group has been able to capture the upside during bullish cycles and remain resilient in the face of challenging environments,” said Chairman Loay Jassim Al Kharafi, who was promoted from his previous role as vice chair following Moataz Adel Al Alfi’s resignation in March.

Raya Customer Experience’s net income more than tripled y-o-y to EGP 6.6 mn in 1Q 2022, according to the company’s latest earnings release (pdf). The Raya Holding subsidiary’s consolidated revenues rose 38% y-o-y to EGP 252.2 mn. Growth was driven by an expansion in the company’s operations, growing business in the Gulf following its acquisition of Gulf Customer Experience (Gulf CX) last year, and increasing utilization rates at its facilities. Half of its revenues came in USD, helping the company to mitigate the impact of the recent EGP devaluation, it said.

Contact center outsourcing has been negatively impacted by “a challenging macroeconomic environment,” the release read. The pandemic dealt a hit to the high-earning segment, meaning HR outsourcing — which has higher costs and lower margins — now accounts for a greater proportion of Raya CX’s revenue breakdown. Contact center outsourcing remains Raya CX’s main business, generating 47% of all revenue in 1Q (compared to some 70% pre-pandemic), while HR outsourcing accounted for 36%. The remainder was generated by hosting.

Egyptian operations contributed the lion’s share of revenues at 84%, followed by the Gulf (12%) and Poland (2%).

Raya CX wants to expand further: “We are pushing forward with our global expansion and diversification plans. Growing our operations in Poland and strengthening our presence as a key player in the European market remains a top priority,” CEO Ahmed Refky said in the release. The company has plans to expand into a new 400-seat facility in Riyadh that is expected to start operations in 2Q 2022, Refky said, adding that the company has managed to secure “strategic contracts” in Saudi Arabia.

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