ELSEWEDY DESIGN - v16a Short pptx aa Relations/Presentation/Investor... · Certain information contained in this document consists of forward ... overhead transmission lines and ...

DISCLAIMER

Certain information contained in this document consists of forward‐Certain information contained in this document consists of forwardrespect to future events and are subject to certain risks, uncertresults, performance or achievements of the Company to be materiathat may be expressed or implied by such forward‐looking statementclimate of Egypt and the Middle East and changes in business strateclimate of Egypt and the Middle East and changes in business strateuncertainties materialize, or should underlying assumptions prove insuch forward‐looking statements. Recipients of this document astatements. The Company undertakes no obligation to republishcircumstancescircumstances.

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looking statements reflecting the current view of the Company withlooking statements reflecting the current view of the Company withtainties and assumptions. Many factors could cause the actualally different from any future results, performance, or achievementsts, including worldwide economic trends, the economic and politicalegy and various other factors Should one or more of these risks oregy and various other factors. Should one or more of these risks orncorrect, actual results may vary materially from those described inre cautioned not to place any reliance on these forward‐lookingrevised forward‐looking statements to reflect changed events or

Elsewedy Electric Investor Presentation 2010

FULL‐SERVICE INTEGRATION

Elsewedy Electric has built 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 turn key infrastructure projects and electricitycontracting and turn key infrastructure projects and electricity generation through competitively advantaged wind technology.

ElectProd

Wind EnergyGeneration

Wiresand Cables

Engineeringand

Contracting

Elsewedy Electric provides integsectors to four

Energy / Infrastructure Industrial

3 of 24

trical ducts

Telecom Transformers Energy Measurement

and Management

grated solutions through seven main markets.

Commercial Residential


GEOGRAPHIC PRESENCE

T d El d El i i i l dToday, Elsewedy Electric is a regional and tactically global integrated cables and electrical products manufacturer and a turn key services provider with more than 10,000 employees working at 30 production facilities in 15working at 30 production facilities in 15 countries

EGYPT• Cables Capacity: 120,000 tons• Copper Rod Capacity: 120,000 tons• PVC capacity: 81,000 tons

NIGERIA• Transformers CapacSYRIA• Transformers Capac

ALGERIA• Cables Capacity: 21,000 tonsYEMEN• Cables Capacity: 10,000 tons

TransformeWires and Cables

SAUDI ARABIA• Cables Capacity: 36,000 tonsSYRIA• Cables Capacity: 28,000 tonsQATAR• Cables Capacity: 18,000 tons

SUDAN• Transformers CapacZAMBIA• Transformers CapacEGYPT• Transformers Capac

LIBYA (In Construction)• Cables Capacity: 15,000 tonsETHIOPIA• Cables Capacity: 10,000 tonsSUDAN• Cables Capacity: 12,000 tons

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GHANA• Road lighting PolesEGYPT• Electrometers Capacity: 2 mn meters

Electrical Products Wind Energy Generation

city: 750 MVA

city: 2,800 MVA

SPAIN• 100 turbinesEGYPT• Wind towers

ers

MALAYSIA• Electrometers Capacity: 250,000SLOVENIA• Electrometers Capacity: 2.5 mn meters

city: 450 MVA

city: 450 MVA

city: 8500 MVA


GEOGRAPHIC PRESENCE

Elsewedy Electric’s comprehensive worldwide distribution network reaches around the globe

Elsewedy T&D

Egypt Algeria Ethiopia

Regional Office

United Kingdom BelgiumGermany

Equatorial Guinea Malawi Jordan

EgyAlgeEthi

PS

Ghana Equatorial GuineaSudan Mozambique Zambia Rwanda

Switzerland Sweden Austria Slovenia Italy Libya

Iraq Kuwait Qatar Bahrain UAEOman

Nige

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Rwanda Libya Australia

Oman Singapore

Main Export Market

Colombia UruguayBrazil

UgandaRwanda South Africa

Cyprus KSA Kuwait

pt eria iopia

SP

United Kingdom Morocco CameroonEquatorial Guinea Congo DRCAngola

ZimbabweMozambique Madagascar Malawi Kenya Ethiopia

UAEKazakhstan India Russia Malaysia

eria


Angola Ethiopia

Corporate Structure : Business Line Review p

BUSINESS LINE REVIEW

Elsewedy Electric’s market oriented delivers full energy solutions through seven business lines

Wind EnergyWires Engineering

Power cables Porcela Wind Turbines Transmission and

Electrical gy

Generationand Cablesg g

and Contracting

Special cables

Winding wires

Ra materials

Cables

Explosequipm

Wind towers

Rotor blades (Planned expansion)

distribution

Engineering and generation

Raw materials Fiber g Wind farm

development

Operation and maintenance

Balance of plant

7 of 24

Telecom Energy Measurement

ain Insulators Power transformers Meters Fiber optics

Products Transformers gy

and Management

s accessories

ion proof ment

Oil immersed distribution transformers

Cast resin

Automation businesses

Meter testing eq ipment

pcables

Copper telecom cables

Fiber opticsglass poles

Cast resin transformers

Modular Solutions

Service

equipment Fiber optics accessories

Copper telecom accessories

FTTX projects

Backbone projects


BUSINESS LINE REVIEW: WIRES AND CABLES

Elsewedy Electric has significantly extended its core wires and cables capacity in recent years, more than doubling capacity since 2007 to approximately 260,000 tons in 2010

Egypt Elsewedy is the sizable market leader Low cost manufacturing and raw material base

Algeria 15% import tariMarket deficit :Low cost manufacturing and raw material base

Export hub

Saudi Arabia

Market deficit : from 2005 to 20

Tax exemptionUnder develope

Largest cable market in the Middle East – expected $140.3 billion needed on electricity projects over the next decade

Preferential treatment to local players

QatarFirst cable prodSolid economic

d d l

Syria Leading market share Sizable domestic market with deficit productions :

Yemen First and only p

Under develope

production deficit expected to increase from 1,000 Megawatt (MW) in 2010 to 1,800 MW by 2012

Proximity to Iraq (a significant deficit market, approximately 40% undersupplied, and

Tax exemption Under develop

Ethiopia export destination)

Tax exemptionLow cost production

pFirst and only pTax exemption Under develop

8 of 24

ffs consumption increase of app 40%

Sudan First & only producer Net Import nationTax exemption consumption increase of app. 40%

010

ed infrastructure E i ti C it (‘000 t )

pGovernment partnershipUnder developed infrastructure

ucer growth d f

120

36 28 18 21 12 10 10

Existing Capacity (‘000 tons)

producer

ed infrastructure

ped Infrastructure

125 147203

250 260

88 100135 150 155

Cables Production Capacity and Sales Volume ( in ‘000 tons)

producer

ped infrastructure2007 2008 2009 2010e 2011e

Cables Production Capacity (tons) Sales (tons)


BUSINESS LINE REVIEW: ENGINEERING AND CONSTRUCTION

Elsewedy Electric’s Engineering and Construction groups deliver electricity generating assets and transmission and distribution (T&D) networks on an EPC basis.

The company also expects to own and operate assets across the power generation and distribution sector.

Engineering a

Elsewedy Electric T&D

Power System Projects Elsewedy T&D

P S t P j t (PSP) Elsewedy Electric T&D supplies, installs and commissions overhead transmission lines and substations on a turnkey basis for national utilities companies

Power System Projects (PSP) provides EPC solutions to power generating and high voltage substation projects

pacross the Middle East and Africa

9 of 24

N

nd Construction

Through Egytech – a wholly

Elsewedy Cables

Elsewedy Power

Elsewedy Power

Through Egytech a wholly owned production facility leveraging the most advanced processes and technologies –Elsewedy Cables supplies state‐

Elsewedy Power develops, designs, builds and operates power assets. The unit acts as Elsewedy Electric’s Engineering and y pp

of‐the‐art power cables to generation and T&D projects worldwide

g gConstruction operations integrator – directing contracts to Elsewedy Electric T&D and PSP and internal suppliers. As a distinct entity, Elsewedy Power also works with experienced developers, EPC contractors d li b d d


and suppliers based around the world.

BUSINESS LINE REVIEW: TRANSFORMERS

Elsewedy Transformers producers a full range of low, medium and high voltage transformers ‐‐ including power (step up) and distribution (step down) transformers .

—Power plantsPowerTransformers

Power plants —T&D substations —Industrial facilities —Subway, metro and other

transportation systems

Egypt First and only producer of power (step

NigeriaFirst and only total tr

up) transformers in the region Low cost manufacturing base Export hub

S i

yUnder developed Infthe lowest per capitaelectricity in the wor

Tax exemptionSyriaFirst and only Transformers producer Proximity to Iraq (untapped export market)T ti

Partnership with the

SudanFirst and only transfo

Tax exemption Low cost production

yTax exemptionPartnership with the Under developed Inf

10 of 24

—High rise buildings

DistributionTransformers

—Hospitals —Wind farms —Airports —Commercial complexes

ransformer producer

ZambiaFirst and only Transformers producer

hi hl d kp

frastructure – one of a supplies of rld

Access to highly untapped markets Partnership with the government Under developed infrastructure

e Government

ormers producer8500

Existing Capacity (MVA)

p

government rastructure

2800750 450 450

Egypt Syria Nigeria Sudan Zambia


Egypt Syria Nigeria Sudan Zambia

BUSINESS LINE REVIEW: METERS

In 2007 Elsewedy Electric acquired Slovenia’s Iskraemeco, one of the wmost technologically advanced producers of metering equipment and s

E MEnergy Meand Man

Iskraemeco

Iskraemeco is one of the world’s most technologically advanced producers of metering equipment. Iskraemecocurrently supplies over 1 million smart meters mostly to countries in Europe and the Gulf

11 of 24

world’s services.

asurement agement

Iskra Amesi

Iskra Amesi, an engineering service provider and holding of Iskraemecoprovides services and equipment for testing metering equipment and industrial automation


BUSINESS LINE REVIEW: WIND

Elsewedy for Wind Energy Generation (SWEG) integrates the world class tproduction expertise of Germany’s SIAG Group, Spain’s M. Torres Olvega InElsewedy Electric. The business line is a significant step for wind power in East.

SWEG – Elsewedy for WM. Torres Olvegad l ( )

Wind Towers – SET WIndustrial (MTOI)

Gearless Wind Turbines

SIAG Elsewedy Towers (SET) SWEGMTOI currently produces is a joint venture between SIAG ‐ Schaaf Industrie Aktiengesellschaft, a leading German steel manufacturer, and Elsewedy

Elsewand cdevel

TWT turbines (1.65 MW) in Spain. A newly developed turbine is time‐phased to enter the market by the end of

Electric, to build wind towers for the MEA region and the South European market.

2011. Production capacity is expected to remain at 100 turbines from 2011 to 2013.

SWEG’s Solutions : Wind Turbines Supply• TWT’s direct drive gearless technology is a unique contribution to the wind

energy industry in terms of reliability, performance, maintenance costs.

Operation and Maintenance • SWEG operates and services all critical wind energy components: Wind

turbines, wind towers and rotor blades.

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technology and ndustrial (MTOI) and Africa & the Middle

Wind Energy Generationind Farm Development

l dOperations and

l dBalance of plant – Elsewedy

bl l d– Elsewedy Power Maintenance – Elsewedy Power

Cables, Elsewedy Transformers, Elsewedy Electrical Products (ECMEI), Iskraemeco

G coordinates with With the acquired SWEG, along with Elsewedy wedy Power as developer o‐developer of wind farm opments.

know‐how of industry leading MTOI, SWEG continues to focus on expanding its operations and

, g yEngineering and Contracting companies, acts as system integrator, executing balance of plant projects with support from across

maintenance offerings. pp

Elsewedy operations

Turnkey Solutions & EPC• SWEG is integrating and utilizing all capacities within Elsewedy Electric to

provide specialized and complete services to the wind energy sector (like additional cables, switchgears, transformers and other products and services).

Wind farm Co‐development• SWEG explores Development & IPP business opportunities to support clients

and ensure successful projects.


BUSINESS LINE REVIEW: ELECTRICAL PRODUCTS

In June 2008 Elsewedy Electric acquired the Egyptian Company for ManElectric Insulator (ECMEI), the Middle East’s leading ceramics insulatorsmanufacturer.

Electrical

ECMEI Fiber Gla

In Egypt and GhaUnited IndustriesElectric Ghana, recompany produce

ECMEI was established in 2004 and today produces 7000 tons of different electric ceramic insulators, with a particular p y p

poles for various purposes, includiand over head tra

pexpertise in high tension with various applications

13 of 24

nufacturing s

Products

ass Poles Explosion Proof Products

na –through and Elsewedy espectively – the es fiber glass

In 2008 the company established Elsewedy SEDCO, a group specializing in explosion proof products for the petroleum g

electricity ng street lighting ansmission lines

p psector. Elsewedy SEDCO supplies bulk electricity goods to the local Egyptian and international petroleum sector.


Financial Performance : Recent Reporting

MANAGEMENT REVIEWEl Se ed Electric Recorded Do ble Digit Gro th in Re en es GrosEl Sewedy Electric Recorded Double Digit Growth in Revenues, GrosProfit and EBITDA for FY 2010, with Net Income reaching LE 795.5 million.

Net revenues reached EGP 12,902 billion for yearend 2010, up 39% compared EGP3,690 billion, 14% higher compared to the previous quarter and 49% higher

Gross profit totaled EGP1,245 billion in yearend 2010, up 29% from the same ph h hhigher than 3Q2010.

Net profit climbed to EGP795 million in yearend 2010, 26% higher than the sammillion, down 49% compared to 3Q2010.

Revenue (LE millions)

12 902

Gross Profit (LE million)

12,902

2 323 3,168

5,746

9,348

11,445

9,290

804.5

1,233.6

2004 2005 2006 2007 2008 2009 2010

2,323

2004 2005 2006 2007

437.1476.7

804.5

15 of 24

Wire & Cables Electrical Products Turnkey Projects Wire & Cable Electrical Prod

ss

to the same period of 2009. Revenues for 4Q2010 reached than the same period of 2009.

period of 2009. 4Q2010 gross profit reached EGP494 million, 1%

me period of 2009. Net profit for 4Q2010 reached EGP97

828 796

Net Profit (LE millions)

1,526.7 1,543.2

1,988

330

508

724828

634

796

2008 2009 2010 2005 2006 2007 2008 2009 2010


ducts Turnkey Projects

MANAGEMENT REVIEW

Wires and Cables revenues reached EGP 2,431 million in the 4Q2010 down 3% from EGP

Wires & Cables Segment Turnkey ProjectsRevenues from turnkey abusiness reached EGP 72million in the 4Q2010, down 3% from EGP

2,498 million in the 3Q10.Sales volume expanded 11% in yearend 2010 compared to the same period of 2009, to 150,964 tons from 135,415 tons in yearend 2009. Volumes reached 33,660

business reached EGP 7277% Q‐o‐Q from EGP 410quarter.Margins remained robust, pusfourth quarter 37% higher to

(EGPmillions) 3Q‐10

tons in 4Q10, slipping 15% Q‐o‐Q from 39,635 tons in 3Q10.

109 million in the third quarte

Revenues

Wires & Cables 2,499

Turnkey Projects 410

Meters 191

Transformers 71

Other Electrical Products (Including Wind) 55

Gross Profit

Wires & Cables 308

Turnkey Projects 109

Meters 45

Transformers 9

Other Electrical Products (Including Wind) 18

Gross Profit Margin

Wires & Cables 12.3%

Turnkey Projects 26%

Meters 23.6%

Transformers 12.0%

16 of 24

Revenues from the transformers segment increased substantially to reach LE 412 million during FY 2010

Transformers Segment

and contracting 27 million for 4Q10 up substantially to reach LE 412 million during FY 2010

versus LE 260 million in FY 2009, an increase of 59%.Gross profit in FY 2010 increased 81% to reach LE 77 million versus LE 42 million in the FY 2009. Theimproved performance in this segment is mainly a result of

27 million for 4Q10, up 0 million in the third

shing gross profit for the EGP 149 million , from EGP

4Q‐10 % Change 2009 2010 % Change

receiving the proper certification from KEMA. Thisapproval enabled us to significantly increase sales in addition to improving the gross profit margin in FY 2010to 18.6%.

er.

2,432 ‐3% 7,438 9,803 32%

727 77% 860 1,690 97%

199 4% 599 613 2%

155 118% 260 412 59%

178 227% 135 384 185%

249 ‐19% 988 1,245 26%

149 37% 327 413 26%

47 3% 119 134 13%

28 223% 42 77 81%

22 23% 67 119 78%

10.2% ‐‐ 13.3% 12.7% ‐‐

‐‐ 34% 24% ‐‐

23.4% ‐‐ 19.9% 21.9% ‐‐

17.8% ‐‐ 16.3% 18.6% ‐‐‐


MANAGEMENT REVIEW

During 2010, we realizedrevenue, mainly during t

Wind Energy SegmeMeters segment revenues surged 4% in 4Q10 to EGP 199 million, up from EGP 191 million in

Meters Segment

, y gthe first installment of thWe shipped 8 turbines toof the contract (29 turbilooks likely to be postpo

to EGP 199 million, up from EGP 191 million in 3Q10.Profit margins in the meters segment dropped 0.2 percentage points to 23.4% in 4Q10, pushing gross profit 3% higher to EGP 47 million in the quarter , up from EGP 45 million in the third quarter of the year Libya stabilizes.

Egypt has committed to instarenewable energy by 2020, owhich we have been shortlisttender. However, with the ce

from EGP 45 million in the third quarter of the year.

Egypt we are uncertain of theremain cautiously optimistic iadditional income in this sect

17 of 24

d LE 120.5 million of the last quarter. This was

Net debt increased by 19% on December 31st, 2010 to reach 4,268 million versus 3,586 in

ent Debt

qhe Libya EPC contract. o Libya and the balance nes ‐ 68 million euro) oned until the situation in

, ,December 31st, 2009 due to the increase in working capital for the following reasons:1. Increase in metal price2. Inventories build up for new operations3 Large cable orders produced towards the end of the

ll 7,000 megawatt of fted for the first 250 megawatt ertain turn of events in

3. Large cable orders produced towards the end of the year and either not delivered or delivered and notcollected.

e timing of this project. We in our ability to generateor during 2011.


FINANCIAL PERFORMANCE: CONSOLIDATED INCOME STATEM

Figures in (EGP ‘000) 2007

Sales Wire & Cable 8,468,463 El t i l P d t 222 063Electrical Products 222,063 Turnkey Projects 657,750 Meters ‐‐‐Total Sales 9,348,276 % change 62.7% Total COGS (8,114,712) ( , , )

Gross Profit 1,233,564 Gross Profit Margin 13.2%

SG&A (249,498) Operating Income 21,424 Operating Expenses (34,353) EBITDA 971,136 % Change 51.7% EBITDA Margin 10.4% Depreciation and Amortization (87 262)Depreciation and Amortization (87,262) FX 32,479 Provisions (3,394) EBIT 912,959 EBIT Margin 9.7% Interest Expense (183,160) p ( , )Interest Income 51,357 EBT 781,157 EBT Margin 8.36% Taxes Paid (24,497) Net Income 756,659 % Change 41.8% Return on Sales 8.1% Reported Net Income 756,659 Minority Interest (32,331) Net Income After Minority Interest 724,327

18 of 24

MENT

2008 2009 2010

9,211,398 7,437,594 9,802,8791 194 124 993 160 796 5231,194,124 993,160 796,5231,040,366 859,986 1,690,100

‐‐‐ 612,51811,445,888 9,290,741 12,902,02022.4% (18.8%) 38.9%

(9,785,144) (7,555,248) (10,914,190)( , , ) ( , , ) (10,914,190)

1,660,744 1,735,493 1,987,83014.5% 18.7% 15.4%

(565,078) (729,780) (851,159)162,731 102,630 139,444(73,324) (95,369) (188,883)1,185,072 1,012,973 1,366,317

22% ‐14.5% 34.9% 10.4% 10.9% 10.6%

(133 988) (192 179) (279 085)(133,988) (192,179) (279,085) 45,400 (37,260) (12,717)

(140,210) 22,919 (3,257)1,075,225 806,453 1,071,2579.39% 8.7% 8.3%

(232,992) (195,310) (220,798)( , ) ( , ) ( , )73,586 53,361 57,320915,820 664,504 907,7798% 7.1% 7%

(18,903) (33,773) (91,142)896,916 630,731 816,63718.5% ‐29.7% 29.5%7.8% 6.8% 6.3%

896,916 630,731 816,637(68,482) 2,862 (21,108)828,434 633,594 795,529


FINANCIAL PERFORMANCE: CONSOLIDATED BALANCE SHEET

Figures in (EGP ‘000) 2007 20Fixed Assets 1,170,861 2,758Investments 313,789 414Other Long term Assets & Goodwill 63,908 68,Other Long term Assets & Goodwill 63,908 68,

Total Long Term Assets 1,548,560 3,241

Inventories 2,074,922 3,170Receivables 1,374,106 1,846Receivables 1,374,106 1,846Other Debt balance 237,425 791,Due from related parties 34,831 64,Cash & Cash Equivalents 982,440 1,318

Total Current Assets 4,703,927 7,191Total Current Assets 4,703,927 7,191

Bank Overdraft & Short term Loans 2,261,025 4,090Accounts Payable 255,940 466Other Credit balance 239,159 501,Due to affiliates 12 824 25Due to affiliates 12,824 25,Provisions 33,044 221

Total Current Liabilities 2,802,195 5,305Working Capital 1,901,731 1,886Total Investments 3 450 291 5 127Total Investments 3,450,291 5,127

Minority Interest 228,712 317Parent's Shareholder Equity 3,074,485 3,858

Total Equity 3 303 197 4 176Total Equity 3,303,197 4,176

Long term loans 39,603 754Other long term liabilities 107,490 196

Total Long term liabilities 147 094 951Total Long term liabilities 147,094 951

19 of 24

T

08 2009 2010 8,299 3,728,647 3,814,070 ,266 372,687 25,753843 524,281 437,335843 524,281 437,335

1,408 4,625,616 4,277,159

0,071 2,779,135 3,699,614 6,734 2,037,296 3,549,7716,734 2,037,296 3,549,771 ,988 618,223 565,198388 293,465 283,3128,371 1,026,687 1,569,112

1,554 6,754,807 9,667,0071,554 6,754,807 9,667,007

0,553 3,624,386 4,765,411,052 994,881 1,165,755,862 765,229 1,150,350394 72 584 156 313394 72,584 156,313 ,233 94,696 71,806

5,096 5,551,778 7309,634 6,458 1,203,028 2,357,373 7 867 5 828 644 6 634 5327,867 5,828,644 6,634,532

,937 377,023 422,478 8,366 4,206,616 4,918,834

6 303 4 583 640 5 341 3126,303 4,583,640 5,341,312

,652 988,582 1,073,036 ,910 256,421 220,184

563 1 245 004 6 634 532,563 1,245,004 6,634,532


Economic Environment

WORLD

The world electricity economy is far from its peak: Electricity has gone from a novelty to a convenience to an advantage to an absolute necessity.C t 1950 2000 2050 ( t )Category 1950 2000 2050 (est.) World Population 2.56B 6.22B 8.29BElectricity Usage 2.06 TW 3.8 TW 6.99 TWElectricity as % of total energy 10.4% 25.3% 33.7%Televisions 0.6B 1.4B 1.9BPersonal Computers 0 500M to 1B 6B to 8BpCell phones (U.S) 0 0.8B 5BElectric hybrid vehicles 0 55,852 3,151,439

B =billion M = million TW = TeraWatt Source: IEA,

According to the International Energy Agency (IEA), a cumulative $13 trillion is needed worldwide from 2008 to 2030, more than half of whis needed for grid and related equipment (as opposed to new or refurbished power plants).

Countries around the world are anticipating significant spending on electrgeneration capacityGlobal Power Generation Investment (USD bn)

960 950

410 340200200 180 170

EU North America

India Latin America Africa Middle East Pacific wJapan

21 of 24

Source: IEA, 2

World electricity generation is projected to grow 87% over the next two and half decades, from 18.8 trillion kWh in 2007 to 25 trillion kWh by 2020 and 35.4 trillion kWh by 20352035.

In more concrete terms, the world needs the equivalent of 25,000 additional 500 MW coal‐fired power

2007

additional 500 MW coal‐fired power plants by 2030.

ich

ricity 35,000

30,000

25,000

20,000

15,000

10 000

w/o n 2004 2010 2015 2020 2025 2030

10,000

5,000

0


Source: IEA, 2007007

AFRICA

In Africa, electric supply is stifling the continent’s growth:

30 countries face chronic blackouts The continent’s entire generation capacity is equivalent to Spain’s

Outside South Africa, consumption is only 1% of OECD levels Twenty‐one of 48 Sub‐Saharan countries have a generation capacity of less than 200 megawatts, well below minimum efficient scale

Universal access is more than 50 years away

5 9 6.2 6.4Africa's Real GDP Growth Rates 2005‐2011e

Despite the challenges, growth remains:

5.9 5.6

2.5

4.55.2

2005 2006 2007 2008 2009 2010e 2011e

22 of 24

Source: IMF

A high potential market:

A recent multi‐stakeholder study backed by the World Bank, the y y ,European Commission and the African Development Bank found that Africa’s chronic power problems require major spending: some $41 billion per year, including new investment and rehabilitation, as well as operations and maintenance

Financing such projects remains difficult, but increasingly governments are overcoming this challenge:

Government debt as percent of GDP has fallen to 59% from 81.9% in the 1990’sTh W ld B k ti t th t Chi fi i The World Bank estimates that Chinese financing commitments in infrastructure increased from less than $1 billion per year in 2001‐2003, to about $6 billion per year in 2006‐2007. 33% of this targeted power

Domestic economic potential is significant:

In 2009, Africa’s population crossed the 1 billion mark and is currently the fastest growing population in the world, set tocurrently the fastest growing population in the world, set to double from today’s level by 2050.

By 2040, Africa’s workforce will be the largest in the world, passing those of India and China

Africa is already nearly as urbanized as China and has 52 cities with more than 1 million people – more than double the number in 1990 and on par with Western Europe

By 2030, 50% of Africans are forecasted to live in cities


MIDDLE EAST

The Middle East’s power industry has emerged as one of the fastest growing in the world : Government subsidies, rapid economic development and a growing consumer market are fueling electricity consumption in the region.

Supply and Demand Mismatch: Installed electricity generation capacity is currently an estimated 20% below aggregate electricity demand across the MENA region All Gulf states, with the possible exception of Qatar, face electricity shortages that intensify during summer. The growing population is adding to the power woes.

Demand is expected to rise by 7‐8% annually on average. In the smallest and fastest‐growing economies electricity

3.53

2 5

44.5

In the smallest and fastest growing economies electricity demand is expected to grow even faster – upwards of 10% in some economies, such as the UAE

Arabic‐speaking countries alone will account for 4.1% of global l t i it d d i 2015 f 3 1% i 2006 B 2030 th i

2.52

1.51

0.50electricity demand in 2015, up from 3.1% in 2006. By 2030 their

share is expected to reach 8.5%.

A Wave of Investment GCC countries are expected to invest hundreds of billions of

0

pdollars over the next decade to provide uninterrupted electricity for their growing populations and support industrial expansions.

Kuwait plans to spend US$ 15 billion to double power capacity to 20 000 megawatts by 2020to 20,000 megawatts by 2020

Saudi Arabia will seek to add 30,000 megawatts to the current 46,000 megawatts of power generation capacity by 2020 at a cost of US$ 45 billion

23 of 24

Annual Percentage Growth in Electricity Generation by Region, 2004‐2030

North America

urop

e / E

urasia

ral / S. A

merica

Africa

Other Asia

India

China

Europe

Asia

Middle East

E.E

Cent Source: IEA, 2007


ELSEWEDY DESIGN - v16a Short pptx aa Relations/Presentation/Investor... · Certain information contained in this document consists of forward ... overhead transmission lines and ...

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