Investor Presentation 1Q 2019 Disclaimer
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Investor Presentation 1Q 2019 Disclaimer Certain information contained in this document consists of forward‐looking statements reflecting the current view of the Company with respect to future events and are subject to certain risks, uncertainties and assumptions. Many factors could cause the actual results, performance or achievements of the Company to be materially different from any future results, performance, or achievements that may be expressed or implied by such forward‐looking statements, including worldwide economic trends, the economic and political climate of Egypt and the Middle East and changes in business strategy and various other factors. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those described in such forward‐looking statements. Recipients of this document are cautioned not to place any reliance on these forward‐looking statements. The Company undertakes no obligation to republish revised forward‐looking statements to reflect changed events or circumstances. Elsewedy Electric | Investor Presentation FY 2018 2 AGENDA I. An Integrated Energy Solutions Global Provider II. Investment Highlights • Full Service Integration • Long Track Record • Strong Geographical Presence • State‐of‐the‐art Facilities • Experienced Leadership • Prestigious Client Base III. Business Line Review IV. Recent Financial Performance V. Corporate Social Responsibility An Integrated Energy Solutions Global Provider Power...Build…Develop Sustainable Value.. Elsewedy Electric is an energy player structured to face the challenges of the world’s fastest growing markets and the complexity of the critical electricity industry. From its start, deep product and sector specialization and unprecedented insight into local Vision markets set the ground work for first mover advantage into new markets and sectors. To become a global leader in delivering energy, services and value Our Core Values & Beliefs Purpose Integrity Innovation Excellence To deliver efficient integrated energy solutions provided with exceptional expertise and service to our customers and communities safely and efficiently. Ownership, Commitment & Customer Satisfaction Collaboration • The Elsewedy family began what is today Elsewedy Electric in 1938 as an electrical equipment trading company. • In 1960, after developing deep market understanding and local presence, the company became Egypt’s first specialized cables distributor. • In 1984, Arab Cables – as the company was then called – built the country’s first private sector cables factory. The event marked the beginning of Elsewedy Electric’s corporate identity. Elsewedy Electric | Investor Presentation FY 2018 4 Full‐Service Integration Elsewedy Electric is a fully integrated energy solutions provider: From raw materials such as metals and plastics to inputs across the spectrum of wires, cables and electrical products, to contracting and turnkey infrastructure projects and electricity generation. Elsewedy Electric provides integrated solutions through five divisions to four main markets. Wires Turnkey Solutions Transformers Energy Measurement Other Electrical and Cables and Management Products Elsewedy Electric | Investor Presentation FY 2018 5 Summary of Main Financial & Performance Indicators Total Revenue Revenue by Segment – Q1 2019 EGP 11,224 mn (EGP bn) Q1 Revenues 2% ▲ 12% y‐o‐y 4% Wire & Cables 7% 42.9 42.5 Turn Key Projects EGP 957 mn Meters 24.6 29% 58% Q1 NP 18.9 Transformers ▼22% y‐o‐y 10.0 11.2 Other electrical products 2015 2016 2017 2018 Q1‐2018 Q1‐2019 >14,000 No. of Employees EBITDA Net Income (after minority interest) (EGP bn) (EGP bn) 35 EBITDA EBITDA Margin Net Income after Minority Net Income Margin Years of Operation 18% 18% 15% 16% 16% 14% 14% 12% 12% 7.8 12% 22 6.4 9% 6.1 7% 5.0 3.9 Production Facilities 4.5 2.2 1.6 1.4 1.2 1.4 1.0 110 2015 2016 2017 2018 Q1‐2018 Q1‐2019 2015 2016 2017 2018 Q1‐2018 Q1‐2019 Export Countries Elsewedy Electric | Investor Presentation FY 2018 6 Investment Highlights Fully Integrated Energy Solutions Provider Elsewedy Electric’s integrated energy solutions provide a full range of offerings to produce, distribute, manage and safely use electrical power Integration across the value chain supports Fast track Quality Cost leadership Brand advantages Ability to offer Cross‐Selling capabilities guarantees turnkey solutions Opportunities Wires & Cables Turnkey Solutions Transformers Meters Other Electrical Products Complete cabling solutions Delivers electricity Full range of transformers Comprehensive range of Cable accessories such as (including raw materials generating assets and (power, dry & oil) ‐ the world’s most modular Terminators, and installation) for power transmission and including power and technologically advanced power cable joints, fiber and special cables (control, distribution (T&D) networks distribution (step up and metering equipment glass poles, insulators and instrumentation, fiber on an EPC basis step down) transformers explosion proof equipment optics, winding and data) Total Capacity Current Backlog Total Capacity Total Capacity Revenue CAGR (‘15‐’18) c. 274,000 tons EGP 64 bn c. 8,050 MVA c. 4 mn Meters 31% Elsewedy Electric | Investor Presentation FY 2018 8 Long Track Record (1/2) The Elsewedy Electric name has existed in the market since 1938 as a distributer of electrical equipment, becoming Egypt’s first specialized cables distributor by 1960 and Egypt’s first private manufacturer of cables with the establishment of a production plant in 1984. Over the next 30+ years, Elsewedy Electric would expand both organically and inorganically through the establishment of plants and the acquisition of companies across the value chain both domestically and abroad. 1936‐2000 2000‐2007 2008‐2010 Elsewedy family started its Established Elsewedy Cables Algeria First Factory Outside Egypt, Giad business as a trader in electrical Established Elsewedy Electric Zambia 1938 2002 Elsewedy Cables 2008 equipment Acquired 70% stake in ECMEI, for electrical insulators Acquired 100% stake in Iskraemco (Slovenia), for energy measurement & management Elsewedy became the only systems 1960 distributor for specialised cables 2003 Established Sudatraf‐ Acquired 30% stake in M. Torres Olvega in Egypt Transformers Industrial (Spain), for wind energy generation Elsewedy becomes Egypt’s first 1984 private sector cables 2004 Established Italsmea Elsewedy, a 2009 Established Elsewedy Cables KSA manufacturer, Arab Cables JV with Italsmea Italy Established Elsewedy Cables Ethiopia Established Elsewedy Cables Yemen Established Elsewedy Transformers Egypt Second factory, Egytech Cables, Acquired a majority stake in Power System is established Projects (PSP) Established first plant for Established Elsewedy Cables 1996 producing PVC compounds and 2005 Syria master batch, Egyplast United Industries is established Group is renamed to Elsewedy Electric Elastimold Egypt is established Established Elsewedy Electric 1997 2006 Ghana 2010 Increased stake in M. Torres Olvega Industrial to 90% Established Siag Elsewedy Towers, a JV with Germany‐based SIAG Established United Metals, first Established Elsewedy Electric Established Doha Cables factory for copper rods Syria (Transformers) Established Elsewedy Electric Nigeria 1998 Established SEDCO, for cable 2007 Established United Wires for Acquired a majority stake in 3W Networks accessories galvanized steel wires Acquired a majority stake in Rowad Modern Engineering Elsewedy Electric | Investor Presentation FY 2018 9 Long Track Record (2/2) Elsewedy Electric has developed a strong track record in the execution of fast‐track projects across Africa. The Group has repeatedly demonstrated its ability to secure high profile contracts both domestically and regionally with local governments Recent Notable Projects EPC Contract for two power generation plants in Egypt Mahmoudia Simple Cycle Power Plant Attaqa Simple Cycle Power Plant Behira Suez Awarded: January 2015 Value: USD 706 mn Capacity: 980 MW Client: Egypt’s Ministry of Electricity & Renewable Energy Scope – Construction of 2 power plant projects with 6 heavy duty gas turbine packages Status: Completed EPC Contract alongside Siemens AG for New Combined Cycle Plant in Egypt EPC Contract for three power generation plants in Angola Awarded: June 2015 Value: € 2 bn (Elsewedy portion: € 785 mn) Capacity: 4,800 MW Beni Suef Combined Cycle Power Plant, Beni Suef Awarded: February 2016 Client: Egyptian Government Value: USD 484.5 mn Capacity: 500 MW Client: Angola Ministry of Electricity and Water (part of Angola’s 2016 Emergency Power Plan) Scope – Engineering, procurement and installation of Scope – Construction of 3 power plants using GE gas turbines in balance of plant in addition to the erection & three different locations in Angola (Camama, Cazenga and South installation of SIEMENS turbines Lunda) Status: 2018 Scheduled Completion Status: 2018 Scheduled Completion Elsewedy Electric | Investor Presentation FY 2018 10 Strong Geographical Presence & Deep Market Insight Today, Elsewedy Electric is a global integrated cables and electrical products manufacturer and a turnkey services provider with more than 14,000 employees working at 25 production facilities in 9 countries Our Domestic Advantage Domestic recognition – Our nearly 100% local staffing allows for tax benefits, lower cost financing and ultimately, better margins and a secure market share Local insight allows us to retain Intelligence