TIDMEFGD
RNS Number : 9230I
EFG Holding S.A.E.
10 August 2023
http://www.rns-pdf.londonstockexchange.com/rns/9230I_1-2023-8-10.pdf
http://www.rns-pdf.londonstockexchange.com/rns/9230I_2-2023-8-10.pdf
EFG HERMES REPORTS FIRST HALF 2023
GROUP EARNINGS OF EGP1.3 BILLION; ON OPERATING REVENUE OF EGP7.6
BILLION
Cairo, August 10(th) , 2023 EFG Holding reports a strong set of
results for the first half of 2023, with Group earnings of EGP1.3
billion on operating revenues of EGP7.6 billion. The Group's total
assets stood at EGP114.2 billion at the end of June 2023.
Key Highlights
2Q23
-- Another buoyant quarter for EFG Holding Group, with the
Investment Bank (EFG Hermes), EFG Finance and aiBANK, all posting
Y-o-Y revenue growth. Group revenues rose 51% Y-o-Y to reach EGP3.1
billion in 2Q23; steered by strong unrealized gains on seed
capital, higher Brokerage, Asset Management and Private Equity
revenues; together with higher revenues delivered by valU and
aiBANK;
-- Group operating expenses, (including employee expenses, other
G&A and Provisions& ECL) rose 53% Y-o-Y to come at EGP2.1
billion in 2Q23. Employee expenses moved up 40% Y-o-Y to EGP1.1
billion, other G&A expenses rose 62% Y-o-Y to EGP649 million
and provisions & ECL gained 93% Y-o-Y to EGP320 million, mainly
on the back of higher salaries, operating expenses and provisions
& ECL reported by all three verticals to reflect inflation and
USD denominated expenses in Egypt, and the impact of a weaker EGP
on the translation of the non-EGP denominated salaries at EFG
Hermes. Employee expenses/revenues came at 37% in 2Q23 and 41% in
1H23;
-- EFG Holding Group net operating profit and net profit before
tax, rose 46% and 37% Y-o-Y to EGP988 million and EGP842 million,
respectively, in 2Q23. Taxes, which rose 76% Y-o-Y to EGP288
million in 2Q23, and was driven mainly by higher deferred taxes
booked by the Investment Bank, weighed down on the magnitude of the
increase in profitability; thus, EFG Holding Group net profit after
tax and minority interest came at EGP405 million, up 20% Y-o-Y, in
2Q23;
-- EFG Hermes (the Investment Bank) revenues grew 61% Y-o-Y to
EGP1.6 billion in 2Q23, lifted by higher revenues posted by the
different platforms: the sell-side, buy-side and Holding &
Treasury. This was powered by strong unrealized gains on seed
capital, higher brokerage executions in Egypt, Egypt Asset
Management's incentive fees, higher Private Equity AuMs, and
generally the impact on revenues generated by operations outside
Egypt and translated to EGP, post the EGP devaluation Y-o-Y;
-- EFG Hermes operating expenses rose 67% Y-o-Y to EGP1.1
billion in 2Q23, driven largely by higher employee expenses,
followed by higher other G&A and ECL booked during the quarter.
This was driven by higher salaries and operating expenses Y-o-Y to
reflect the impact of the non-Egypt operations/offices expenses,
the USD denominated expenses in Egypt and the high inflation levels
in Egypt Y-o-Y;
-- EFG Hermes reported decent profitability from its operations
in 2Q23, as the Investment Bank net operating profit and net profit
before tax, rose 47% Y-o-Y and 45% Y-o-Y to EGP443 million and
EGP405 million, respectively. Higher taxes from operations and
higher deferred taxes dented profitability; thus, EFG Hermes net
profit after tax and minority inched up only 3% Y-o-Y to EGP212
million;
-- EFG Finance revenues added 23% Y-o-Y to EGP620 million in
2Q23, underpinned by higher revenues recorded by all lines of
business except Tanmeyah, and predominately on higher revenues
posted by valU, which included EGP75 million of securitization
gains;
-- EFG Finance operating expenses rose 30% Y-o-Y to EGP477
million, mainly on other G&A expenses to reflect inflation and
the impact of the devaluation on USD denominated expenses, and
higher provisions & ECL required as the loan portfolio
continued to grow; meanwhile, employee expenses was largely
unchanged;
-- EFG Finance net profit before tax and minority interest
declined 24% Y-o-Y, as the quarter included EGP34 million of
goodwill amortization related to Fatura's PPA, which in a
requirement within the first anniversary from the acquisition date.
However, net profit after tax and minority reached EGP54 million,
down only 5% Y-o-Y, on Tanmeyah's lower tax charge and minority
interest compared to 2Q22;
-- aiBANK reported revenues of EGP888 million in 2Q23, up 58%
Y-o-Y; driven by stronger net interest income on the back of the
growth in interest earning assets, jointly with higher fees &
commissions as trade finance volumes increased Y-o-Y;
-- aiBANK operating expenses including provisions & ECL rose
49% Y-o-Y to EGP487 million in 2Q23, on higher salaries on the back
of promotions, inflation, and new hirings during 2Q; higher other
G&A expenses to reflect high inflation levels in Egypt and the
devaluation impact on USD denominated expenses; together with an
increase in provisions & ECL as the bank continues to enhance
its coverage ratios, in addition to ECL required for investments
such as securitization that entail higher provisions;
-- The Bank's net profit after tax rose 86% Y-o-Y to EGP271
million (of which EFG Hermes' share is EGP138 million) in 2Q23, as
revenues growth outpaced the growth in expenses.
For full report and financial statements, please click on the
links on top of the page.
For further information:
Investor Relations Contacts
Email: investor-relations@efg-hermes.com
Group Head of Corporate Strategy & Investor Relations
Hanzada Nessim
Email: hnessim@efg-hermes.com
Tel: +20 (0)2 35356502
www.efg-hermes.com
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END
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