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Sunday, 20 November 2022

CI Capital, IDH + Raya Holding report 3Q earnings

Earnings continued in earnest on Thursday, with a number of high-profile companies releasing their 3Q 2022 figures.


CI Capital reported a 28% increase in revenues to EGP 2.5 bn in 9M 2022, it said in a statement (pdf). Net earnings after tax and minority interest rose to EGP 486 mn, up 18% from a year earlier.

CI Capital’s investment bank “delivered solid results” across the board, it said in the statement. Investment banking revenues reached EGP 58 mn during the first nine months of the year. CI Capital Asset Management saw its assets under management almost quadruple to EGP 48.4 bn, while the company’s brokerage captured a 16.4% market share, it said.

NBFS growth: CI Capital’s non-bank financial services platform also registered strong growth across revenues, net income, and new bookings, with Reefy reporting a 67% increase in net income, CI Mortgage tripling its loan portfolio to EGP 598 mn, and Corplease booking a EGP 271 mn profit.

What they said: Chairman Mahmoud Attalla attributed the results to the “efficiency of [CI Capitals] talented workforce, and a resilient business model that can weather market challenges.”

NBFS activities accounted for 82% of CI Capital’s group consolidated revenues, Group CEO Hesham Gohar said. “The Group continued to lead the Egyptian market with total on balance sheet financing portfolio reaching a new record-high.”


Integrated Diagnostics Holdings (IDH) saw its net income fall 65% y-o-y to EGP 403.4 mn in 9M 2022, according to its latest earnings release (pdf). Revenues at the medical diagnostics firm were down 26% y-o-y to EGP 2.8 bn in the nine-month period. IDH attributed the dip in revenue to a dropoff in demand for covid-related products, while margins were squeezed by higher accounting fees, higher marketing expenses, higher running costs at newly opened branches, and the cost of securing USD to fund its 2021 dividend, which it paid earlier this year.

Covid-related income was down, conventional revenues were up: Covid-19-related income was down 65% to EGP 678 mn in the first nine months of the year, as demand and average prices fell. This was partly offset by an increase in conventional revenues, which grew 14% to EGP 2.1 bn.

Revenues from the company’s local operations were down 28% in 9M 2022 thanks to the “rapid decline” in covid testing demand. Egypt still accounted for 82% of the company's total net sales, followed by Jordan with 16%, then Nigeria (2%) and Sudan (0.5%).

What they said: “Mid-way through the final quarter of the year, we remain well on track to record double-digit full-year growth, a remarkable achievement in light of the difficult macroeconomic environment faced across our markets and more generally across the world,” IDH CEO Hend El Sherbini said. “Despite the short-term challenges currently faced by the business, we remain optimistic on its long-term growth prospects, and have continued to invest to deliver on our long-term growth strategy.”


Raya Holding’s net income dropped 45% y-o-y in 9M 2022 to EGP 241 mn, according to the company’s earnings release (pdf). Revenues were up 14% during the first nine months of the year to post EGP 14.1 bn, as trade, IT, fintech non-bank financial services (NBFS), and FMCG sectors continued to outperform. Raya’s net income was down 69% y-o-y in 3Q 2022 to EGP 97 mn even as revenues rose 21% to nearly EGP 5.0 bn.

Raya blames base effect: Raya attributed the fall in net income to a negative base effect thanks to one-off earnings from last year’s sale of recycling subsidiary BariQ to Intro Group.

The breakdown: Raya’s trade and distribution business unit generated 41% of Raya’s total revenues in 9M 2022. The second biggest contributor was the firm’s IT sector with 18%, followed by fintech NBFS with 18%.

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 planned to take place this year but was pushed to 2023 due to turbulence in the financial markets.

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