Qalaa Holdings announced on Wednesday its consolidated financial results for the year ended 31 December 2018, recording revenue growth of 25% year-over-year (y-o-y), reaching EGP 13.2bn.
On a quarterly basis, the company’s revenues grew by 34% y-o-y, reaching EGP 3.8bn during the fourth quarter (Q4) of 2018.
“Growth was driven by strong results from all subsidiaries, especially Qalaa’s energy subsidiary TAQA Arabia and Sudan’s Al Takamol Cement, which reported a rise in cement volumes as well as sales price,” according to the company’s press statement.
Qalaa recorded a net profit after minority interest of EGP 1.35bn in FY 2018 versus a loss in the previous year, with the Group’s profitability being supported by the non-cash one-off gain. Qalaa’s net profit in last quarter of 2018 recorded EGP 924m versus a loss of EGP 1.3bn in the same quarter of last year.
Qalaa booked a non-cash one-off gain of EGP 3.7bn in FY 2018, following the deconsolidation of Africa Railways’ operational liabilities in both Kenya and Uganda. The deconsolidation generated a gain of EGP 2.6bn in Q4 of 2018, with the balance having been booked during Q2 and Q3 of 2018.
Earnings before interest, tax, depreciation and amortization (EBITDA) for the year recorded EGP 1.27bn, up 36% y-o-y driven by operational growth at Qalaa’s energy sector as well as strong performance at Al Takamol Cement. On a quarterly basis, EBITDA was up 42% y-o-y to EGP 334.2m.
Commenting on the result, Qalaa Holdings Chairperson and Founder, Ahmed Heikal, stated: “The results are a direct consequence of Qalaa’s investment strategy and our drive for operational expansion across our portfolio. Leading the pack was TAQA Arabia which continues to position itself as a leading player in Egypt’s energy sector including gas, power, and petroleum products, and is successfully capitalising on the favourable market liberalisation.”
“We will continue our drive to increase revenues from existing operations with minimal incremental investments while rationalizing costs (particularly energy costs). We also expect significant expansion in top-line going forward as we bring production from our transformational Egyptian Refining Company (ERC) to market,” Heikal added.
He explained that the ERC has already began trial operations in early 2019 and as of May has supplied c. 160,000 tonnes of low sulfur European specs diesel, naphtha, and high-octane gasoline to the Egyptian General Petroleum Corporation (EGPC).
“We are working to complete all trial operations and begin commercial production by the beginning of Q3 of 2019, and are actively seeking a larger ownership stake in this flagship project,” disclosed Heikal.