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Wednesday, 17 August 2022

B Investments, Raya CX + Raya Holding report 2Q earnings

B Investments’ net income rose 74% in 2Q 2022, reaching EGP 38.15 mn, according to the company’s consolidated financial statement (pdf). Revenues for the quarter came in at EGP 44.8 mn, up 19% y-o-y. The company’s bottom line fell 17% y-o-y to EGP 60.5 mn in the first six months of the year, while consolidated revenues dropped 40% to EGP 59.6 mn. The 1H 2022 bottom line includes a EGP 25 mn FX gain, primarily from Infinity Solar assets, it said in its accompanying earnings release (pdf).

The breakdown: The decline in 1H 2022 revenues was mainly due to the firm not including Giza Systems’ income starting FY 2022 — as B investments is in the process of selling its 65.7% stake in the systems integrator — along with new investments in B Healthcare Investments and taking part in capital increases at Madinet Nasr Housing and Development and Basata, which led to a reduction in cash balance. The lower revenues also came on the back of MNHD not distributing dividends in 1H 2022.

Raya Customer Experience saw its net income rise 46% y-o-y in 1H 2022 to EGP 14.2 mn, the company’s latest earnings release (pdf) showed. Its top line grew 44% y-o-y to EGP 540.8 mn. Revenue growth was led by an expansion of the Raya Holding subsidiary’s operations, growing business at its recently acquired call center firm Gulf Customer Experience (Gulf CX), and higher utilization rates across its facilities, it said.

Contact center outsourcing remains Raya CX’s primary revenue generator, reporting EGP 272.1 mn in the first six months of the year, accounting for more than half of total revenues. The company’s insourcing business came in second place with 32% of total revenue, followed by hosting, which made up the remaining 18%.

A Gulf boom: While the firm’s Egyptian operations continue to account for most of its business, its Gulf operations saw revenues grow nearly sevenfold y-o-y to EGP 78.1 mn thanks to the Gulf CX acquisition. “One of RCX’s strategies is to grow its geographic footprint into more high value markets in the region and beyond,” the company said. “Our expansion in the Gulf area has proven to be a successful step in realizing our regional growth strategy.”

Raya Holding’s net income rose 14% y-o-y in 1H 2022 to EGP 144 mn, according to the company’s earnings release (pdf). Revenues were up 10% during the first six months of the year, coming in at just over EGP 9.1 bn, as trade, fintech, non-banking financial services (NBFS), IT, and FMCG sectors continued to outperform.

The breakdown: Raya’s trade and distribution business unit generated 46% of Raya’s total revenues. The second biggest contributor was the firm’s fintech and NBFS business, accounting for almost 19% of revenues, followed by IT, which made up 17% of the total.

IPO WATCH? The boards of Raya Holding and Aman Holding are hoping that market conditions will soon be favorable to list their NBFS platform Aman on the stock exchange, the company said. The Aman IPO was recently pushed to 2023 due to turbulence in the financial markets.

CORRECTION- In our coverage yesterday of Contact Financial Holding’s 2Q 2022 earnings, we misattributed the cause of a 60% rise in the company’s operating expenses, which we have since learned was the result of increased investments in the company’s physical branch network, digital infrastructure, and product offering. The company’s financing operating income was up 27% y-o-y during the quarter, while total operating income grew 30% y-o-y. Contact also recorded portfolio growth of 38% during 2Q. Net income for 1H 2022 was up 18% y-o-y to EGP 258 mn.

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