ELSEWEDY H1-2014 Investor Presentation. pptx Relations/Presentation... · 2014-09-15 · new markets and sectors. Elsewedy Electric Investor Presentation H1‐2014. FULL‐SERVICE

DISCLAIMER

Certain information contained in this document consists of forward‐looking statements reflecting the current view of the Company withrespect 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 thatmay be expressed or implied by such forward‐looking statements, including worldwide economic trends, the economic and politicalclimate of Egypt and the Middle East and changes in business strategy and various other factors. Should one or more of these risks oruncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those described insuch forward‐looking statements. Recipients of this document are cautioned not to place any reliance on these forward‐lookingstatements. The Company undertakes no obligation to republish revised forward‐looking statements to reflect changed events orcircumstances.

2 of 44 Elsewedy Electric Investor Presentation H1‐2014

AGENDA

An Integrated Energy Solutions CompanyCorporate Timeline Strategy

Full Service Integration Geographic Presence Advanced Technology

Business Line Review Recent Financial PerformanceAppendix I: Economic Environment


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AN INTEGRATED ENERGY SOLUTIONS COMPANY

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 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 markets set the ground work for first mover advantage into new markets and sectors.

Elsewedy Electric Investor Presentation H1‐2014

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 through competitively advantaged wind technology.

Energy / Infrastructure Industrial Commercial Residential

Electrical Products

Transformers

Elsewedy Electric provides integrated solutions through six divisions to four main markets.

Wind EnergyGeneration

Energy Measurement

and Management

Engineeringand

Contracting

Wiresand Cables



Elsewedy Electric delivers full energy solutions through six business lines

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Porcelain insulators

Cables accessories

Explosion proof equipment

Fiber glass poles

Electrical Products

Power transformers

First and only producer of power (step up) transformers in the region

Oil immersed distribution transformers

Cast resin transformers

Modular Solutions

Service

Transformers

Meters

Software Communication

Energy Measurementand Management

Transmission and distribution

Engineering and generation

Engineeringand Contracting

Wind turbines

Wind towers

Wind farm development

Operation and maintenance

Balance of plant

Wind EnergyGeneration

Power cables

Special cables

Winding wires

Raw materials

Wiresand Cables


CORPORATE TIMELINE

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Elsewedy Electric believes that the key to thriving in a competitive marketplace is remaining at the fore of the increasingly complex landscape.

The company seeks to transform as an adaptive organization strategically evolving and responding to an ever‐changing global and industry environment.

ARAB CABLESEgypt’s 1st special cables production plant

EGYTECH Power cables manufacturer

SEDPLASTPVC compounds and Master Batch plant – raw materials

UNITED INDUSTRIESSpecial cables producer (instrumentation cables, low smoke halogen free, control cables, co‐axial cables, automotive wires)

ELASTIMOLDFully integrated cables accessories plant

UNITED METALSCopper rods manufacturer

ELSEWEDY SEDCOCable joints and terminations pioneer in Egypt

GIAD ELSEWEDY CABLESSudan’s first cables plant

1984 1996 1997 1998 2002


CORPORATE TIMELINE

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SUDANESE EGYPTIAN ELECTRICAL INDUSTRIESTransformers manufacturer in Sudan – extends Sudan presence beyond cables

ITALSMEASpecialized explosion proof equipments producer

ELSEWEDY CABLES SYRIACables production facility in Syria to serve the Levant markets

ELSEWEDY ELECTRIC GHANARoad Lighting Poles facility in Ghana

ELSEWEDY ELECTRIC SYRIA Full service and fully integrated cables and transformers facility to service demand across the Middle East

UNITED WIRES Production facility specialized in galvanized steel wires

2003 2004 2005 2006 2007


CORPORATE TIMELINE

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ELSEWEDY CABLES ALGERIAFully localized cables production facility filling domestic demand

ELSEWEDY ELECTRIC ZAMBIA The group’s transformer manufacturing company in Africa, serving regional demand (Elsewedy is Africa’s only transformer producer)

ECMEI 70% stake in The Egyptian Company for Manufacturing Electric Insulators – secures the manufacturing technology for electrical porcelain insulators and remains the sole producer in Africa and the Middle East

ISKRAEMECO 100% share of the worldwide manufacturer of energy measurement and management systems; a global technology leader, the third largest player in the European market and the seventh largest globally

M. TORRES OLVEGA INDUSTRIAL 30% holding of the wind energy division of the Spanish technology group, allowing Elsewedy to establish SWEG (Elsewedy for Wind Energy Generation – a company 100% owned by Elsewedy Electric)

2008EL SEWEDY CABLES KSAFully localized cables production facility filling domestic demand

EL SEWEDY CABLES ETHIOPIAFully localized cables production facility filling domestic demand

EL SEWEDY CABLES YEMEN Fully localized cables production facility filling domestic demand

EL SEWEDY TRANSFORMERS EGYPTFirst and only producer of power (step up) transformers in the region

RENAMED ELSEWEDY ELECTRICInstitutionalization and integration continues as Elsewedy builds its full service platform

M. TORRES OLVEGA INTERNATIONAL STAKE INCREASERenegotiates agreement with M. Torres to acquire an additional 60% of the Spanish wind turbine manufacturer, for a total 90% stake, reducing per share acquisition price significantly

SIAG ELSEWEDY TOWERS (SET).SIAG Elsewedy Towers (SET)— a joint venture with SIAG, a leading German company specialized in wind mill tower construction (part of SWEG). SET production facility opens in Ain Sokhna, Egypt

DOHA CABLES Fully localized cables production facility filling domestic and near‐regional demand

ELSEWEDY ELECTRIC NIGERIA Nigeria’s first and only transformers plant with production capacity of 750 MVA

3W NETWORKS A majority stake in 3W Networks, a technology based communications contractor and systems integrator

2009 2010


STRATEGY

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GeographicPresenceGeographicPresence

AdvancedTechnologyAdvancedTechnology

Full‐ServiceIntegrationFull‐ServiceIntegration

Aggressive positioning across product, services and geography

Our strategy is driven by a unique corporate structure that allows Elsewedy Electric to act as both a global company with multi‐national operations and export markets, and as a truly local market player with deep roots in domestic economies.




Elsewedy Electric designs, develops and operates generating, transmitting and distributing infrastructure. Additionally, the company’s production divisions supply external generation, T&D and utilities players and projects. Moving forward, Elsewedy Electric expects to assume equity stakes in power generation and distribution assets, including wind and traditional generation sources.

Sector Exposure: Utilities – power generation and distribution Utilities – water treatment Transportation infrastructure – airports and tunnels

Integrated Offerings: EPC – engineering, procurement, construction – and

development of traditional source power plants Transmission and distribution (T&D) Supply of complete cabling solutions for power production,

transmissions and distributions Utilities management – lighting, access control, monitoring

and safety Electricity pre‐payment systems Windmill manufacturing, wind farm development and wind

energy generation and distribution

FULL‐SERVICE INTEGRATION: ENERGY AND INFRASTRUCTURE

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Electrical Produ

cts

Transformers

Wind En

ergy

Gen

eration

Wire

sand Cables

Engine

ering

and Co

ntracting

Energy M

easuremen

tand Managem

ent


FULL‐SERVICE INTEGRATION: INDUSTRIAL

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Transformers

Energy M

easuremen

tand Managem

ent

Wind En

ergy

Gen

eration

Wire

sand Cables

Engine

ering

and Co

ntracting

Elsewedy Electric supplies raw materials, designs and builds infrastructure and distributes electricity to industrial clients across a range of sectors. The company also develops and manages internal systems and measures and optimizes consumption at production facilities.

Sector Exposure: Industrial parks Manufacturing across segments Automobile Cement, aluminum and steel Food and beverage packaging Pharmaceuticals Chemicals

Integrated Offerings: Complete cabling solutions (including raw materials and

installation) for power and special cables (control, instrumentation, fiber optics, winding and data)

Optimization of process energy performance Control and monitoring systems for machines Process automation Electrical distribution – protection and installation systems Electricity metering and supply quality management Fire alarm solutions

Electrical Produ

cts


FULL‐SERVICE INTEGRATION: COMMERCIAL

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Elsewedy Electric produces, distributes, installs and manages full‐service electricity solutions for commercial space development and renovation and ongoing service provisions.

Sector Exposure: Offices Shopping centers Industrial and warehouse complexes Hotels Hospitals

Integrated Offerings: Complete cabling solutions (including raw materials and

installation) for power and special cables (control, instrumentation, fiber optics, winding and data)

Power supply and distribution Utilities management – lighting, access and control of

electricity Energy measurement and management Multi‐site remote management Data exchange – voice‐data‐image , power line carrier

technology, radio Fire alarm solutions

Transformers

Energy M

easuremen

tand Managem

ent

Wind En

ergy

Gen

eration

Wire

sand Cables

Engine

ering

and Co

ntracting

Electrical Produ

cts


FULL‐SERVICE INTEGRATION: RESIDENTIAL

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Electrical Produ

cts

Transformers

Energy M

easuremen

tand Managem

ent

Wind En

ergy

Gen

eration

Wire

sand Cables

Engine

ering

and Co

ntracting

Elsewedy Electric produces and distributes a full range of products that bring electricity, energy measurement and communications to regional households.

Sector Exposure: New and renovated single family residences New and renovated apartment complexes

Integrated Offerings: Complete cabling solutions for power and special cables

(control, instrumentation, fiber optics, winding and data) Electrical distribution, protection and installation systems Home automations and data exchange Monitoring and safety Electricity metering and supply quality management Communication and multimedia networks – voice‐data‐image

and power line carrier networks providing access in all rooms to telephone, TV, internet and other connection via electrical wiring systems


Elsewedy Electric’s integrated energy solutions providea full range of offerings to produce, distribute, manage and safely use electrical power




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A full‐service, vertically integrated product line:Diversification across production, engineering and generation with focused electricity specialization

Raw and intermediate materials and export hub in Egypt leverages low cost production, a favorable trade environment and a central geography.

Global production distributes operations strategically —Elsewedy enters a market where it sees opportunity and expands to other activities in the market organically …

…Local entities facilitate and organize the group’s various activities — one division’s presence allows a group‐wide foothold in new markets.

Full‐service energy solutions model maintains the ability to cross‐sell products and grow long term customer relationships, crucial in developing a leading market position.

Integration across the value chain supports:– Fast track capabilities– Quality guarantees– Cost leadership– Brand advantages– Ability to offer turnkey solutions


GEOGRAPHIC PRESENCE


GEOGRAPHIC PRESENCE

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SLOVENIA• Electrometers Capacity: 3 mn metersEGYPT• Electrometers Capacity: 1 mn metersMALAYSIA• Electrometers Capacity: 250,000 metersGHANA• Road Lighting Poles

Electrical Products Wind Energy Generation

EGYPT• Cables Capacity: 156,000 tons• Copper Rod Capacity: 120,000 tons• PVC Capacity: 81,000 tonsSAUDI ARABIA• Cables Capacity: 39,000 tonsQATAR• Cables Capacity: 24,000 tons

EGYPT• Transformers Capacity: 8,500 MVASUDAN• Transformers Capacity: 450 MVAZAMBIA• Transformers Capacity: 450 MVAAlgeria• Transformers Capacity: 400 MVA

SPAIN• Wind turbinesEGYPT• Wind towers

ALGERIA• Cables Capacity: 30,000 tonsSUDAN• Cables Capacity: 12,000 tons ETHIOPIA• Cables Capacity: 9,600 tons

Transformers Wires and Cables (Total Capacity)

Today, Elsewedy Electric is a global integrated cables and electrical products manufacturer and a turnkey services provider with more than 10,000 employees working at 30 production facilities in 15 countries


GEOGRAPHIC PRESENCE

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

Engineering & Contracting

Algeria ChadCameroonEgypt Equatorial GuineaEthiopia IraqGhana Mozambique

Main Export MarketAustria Bahrain BelgiumBrazil BulgariaCongo DRCCyprusEquatorial Guinea

KenyaKuwaitLibya Madagascar Malawi MalaysiaMoroccoMozambiqueOman

The NetherlandsQatarRussiaRwandaSaudi ArabiaSouth AfricaSpainTunisiaUAE

UgandaUnited Kingdom UruguayZimbabwe


Ethiopia FinlandFranceGermanyIndiaIraqItalyJordanKazakhstan

NigerNigeriaRwandaSaudi ArabiaYemen Zambia

GEOGRAPHIC PRESENCE

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Economies of scale without compromising local producer advantages– Elsewedy considers production and distribution decisions holistically — fully localized global entities are integrated extensions of Elsewedy’s Cairo‐headquartered operations

Domestic recognition – with nearly 100% local staffing – allows: – Tax benefits – Lower cost financing – Ultimately, better margins and secure market share

Local insight establishes:– Intelligence on local conditions and players – Key relationships – Position to anticipate market demand

Considerable investment in scalability of ICT infrastructure to link geographically dispersed factories and offices (investment continues):– Shares data and knowledge – Reduces costs and lead times – Improves management operational processes

Our structure is our strategy: A closely aligned federation of fully localized production and distribution centers with a global coordination center


ADVANCED TECHNOLOGY


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Our structure is our strategy A premium on rationalizing production and distribution decisions — Elsewedy seeks select, tactical access to attractive energy and infrastructure demand in both developed and developing markets

Operations structured to push regional and international economies of scale Distributed national and business cycle risk

Global yet local An organization that understands and respects how different countries operate and utilizes organizational learning and knowledge transfer to push the limits of culture and find opportunities to innovate

First‐mover advantages in underdeveloped infrastructure markets in the Middle East and Africa, many of which are rolling out sizable infrastructure spending plans with little or no domestic supply

Investing in technology An understanding of which core technologies to master and aggressive investment in these opportunities Recognizes the limits to specialization Leverages deep specialization and accrued competitive advantages with broader diversification

Dynamic management Elsewedy is progressing toward a management structure that facilitates quick decision‐making and carefully monitors developments around the world: Each executive committee member is increasingly responsible for a business, region, function or industry segment, placing the highest level of management in touch with core activities

Human capacity remains a challenge for all operators in Elsewedy Electric’s main markets: The company continues to focus on hiring and training the region’s most talented managers and employees

Elsewedy Electric’s Approach to Emerging and Global Markets

An organization that combines global‐scale and world‐class technology with deep roots in local markets

ADVANCED TECHNOLOGY: ELSEWEDY ELECTRIC’S APPROACH TO GLOBAL MARKETS


ADVANCED TECHNOLOGY

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Wind: With the acquisition of a majority stake in M. Torres Olvega Industrial, Elsewedy Electric is offering complete wind solutions: manufacturing and developing wind farms and selling electricity to third parties with a strategy of owning early stage gearless turbine technology that makes wind farms cheaper to maintain.

Wires and Cables: Elsewedy Electric’s state‐of‐the‐art cable manufacturing factories are equipped with premier technology.

Advanced technology acquisition and development places Elsewedy Electric at the forefront of world electricity trends, positioning the group to supply the most cost effective, clean technology to regional developing nations. Group‐wide sharing of the most advanced production technology extends significant efficiency gains across the group's activities, while effective brand development boosts the group’s profile as a leading energy player.

Transformers: Elsewedy Transformers is the first and only producer of power (step up) transformers in the region up to 220KV.

Meters: Through Iskraemeco – a Slovenia based metering products, systems and services company established in 1945 and acquired in 2007 – Elsewedy Electric has gained the world’s most advanced residential and corporate utilities measurement technology


Business Line Review

BUSINESS LINE REVIEW: WIRES AND CABLES

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

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

Ethiopia First producerUnder‐developed infrastructure

Algeria 15% import tariffs Market deficit – consumption increase of app. 40% from 2005 to 2010

Under‐developed infrastructure

Sudan First and only producer Net import nationGovernment partnershipUnder‐developed infrastructure

QatarFirst cable producer Solid economic growth Under‐developed infrastructure

Elsewedy Electric has significantly extended its core wires and cables capacity in recent years, more than doubling capacity since 2007 to approximately 272,400 tons as of December 31st 2013, as Elsewedy Electric positions itself to supply significant regional energy demand.

156

3924 30 12 9.6

Egypt SaudiArabia

Qatar Algeria Sudan Ethiopia

Existing Capacity (‘000 tons)

Cables Production Capacity and Sales Volume ( ‘000 tons)

125147

203

250

282 282 272

88 100

135 151 157 163 159

2007 2008 2009 2010 2011 2012 2013

Cables Production Capacity (tons) Sales (tons)


BUSINESS LINE REVIEW: ENGINEERING AND CONTRACTING

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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 and Construction

Elsewedy T&D supplies, installs and commissions overhead transmission lines and substations on a turnkey basis for national utilities companies across the Middle East and Africa.

Elsewedy T&D

Through Egytech – a wholly owned production facility leveraging the most advanced processes and technologies –Elsewedy Cables supplies state‐of‐the‐art power cables to generation and T&D projects worldwide.

EgytechPower System Projects

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

Elsewedy Power develops, designs, builds and operates power assets. The unit acts as Elsewedy Electric’s Engineering and Construction operations integrator – directing contracts to Elsewedy Electric T&D and PSP as well as internal suppliers. As a distinct entity, Elsewedy Power also works with experienced developers, EPC contractors and suppliers based around the world.

Elsewedy Power



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Power Systems Projects (PSP) integrates Engineering, Procurement and Construction services with complete project management, tailoring services to meet a broad range of client projects and business activities across the region – from coal and gas‐fired plants to complete wind farm development and construction

PSP invests in equity stakes of construction, operation and maintenance of electrical systems including

generation and T&D projects

Globally source material and equipment from proven manufacturers, including Elsewedy Electric subsidiaries

Manage logistics of material and equipment delivery, ensuring projects are completed on schedule

Provide a range of services from overall construction management to actual construction and commissioning

Ensure facility is completed on time, on budget and to specification

Engineering Procurement Construction

Determine all facility, equipment and material requirements

Produce all technical deliverables required to execute the project

Review vendor proposals Ensure safety in designs

PSP

PSP is structured vertically along functional business lines and integrated by project management professionals



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Elsewedy Electric T&D Design, engineering, procurement, installation, testing and commissioning of low and medium voltage overhead transmission lines

Design, engineering, procurement, installation, testing and commissioning of low and medium voltage substations

Design, engineering, manufacture and procurement, installation, testing, commissioning and startup for rural distribution systems

Design and installation of industrial electrical power and distribution systems Complete rural electrification schemes

Africa is well endowed with the potential for cost‐effective energy resources on a large scale: Regional power trade is the solution to the continent’s high‐cost and low‐efficiency environment.

But making regional power trade work is a considerable challenge, in part because of the many missing links in the continental power‐transmission network. Elsewedy Electric’s T&D services arm is building these networks across the continent.


BUSINESS LINE REVIEW: ENGINEERING & CONTRACTING

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Capabilities EPC – Engineering,

Procurement & Construction EES – Engineering, Equipment Supply ES – Equipment Supply O&M – Operation and Maintenance

Generation Types Wind Diesel (LFO) Heavy Fuel Oil (HFO) Gas Dual Fuel (LFO/HFO) Bio Fuel

Clients Public Utilities Independent power producers (IPPs) Governmental and public facilities Industrial facilities

(mines, plants, mills and others) Private developers

(malls, villages, hotels, hospitals , high rises)

Financials SC – Supply credit EPC Credit BLT – Build, lease, transfer BOT – Build, operate, transfer BOOT – Build, own, operate, transfer

AlgeriaChadEgypt Ethiopia Equatorial GuineaGhana MozambiqueNigerRwanda Zambia

Elsewedy T&D

Egypt Algeria Ethiopia Nigeria

PSP

Elsewedy Electric’s engineering and construction teams have completed projects throughout Africa.

IraqYemenCameroon

Elsewedy Power


BUSINESS LINE REVIEW: ENGINEERING & CONTRACTING

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Elsewedy Electric’s engineering and contracting solution offers regional clients a single solution to full generation and distribution needs.

860

1,690

2,525

1,8801,787

8521,008

2009 2010 2011 2012 2013 H1‐2013 H1‐2014

38%

24% 23% 21%

14%

20%

14%

2009 2010 2011 2012 2013 H1‐2013 H1‐2014

Turnkey Gross Profit Margin


Engineering & Contracting Revenues (EGP mn)

BUSINESS LINE REVIEW: TRANSFORMERS

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Elsewedy Transformers is the first and only producer of power (step up) transformers in the region up to 220KV. The group produces a full range of low, medium and high voltage transformers ‐‐ including power (step up) and distribution (step down) transformers .

Egypt First and only producer of power (step up) transformers up to 220KV

First and only producer of dry type transformer up to 10 MVA

Low cost manufacturing base Export hub

SudanFirst and only transformers producerPartnership with the government Under‐developed infrastructure

PowerTransformers

DistributionTransformers

—First and only producer in the region

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

transportation systems

—High‐rise buildings —Hospitals —Wind farms —Airports —Commercial complexes

ZambiaFirst and only transformers producer Access to highly untapped markets Partnership with the government Under‐developed infrastructure

8,500

450450 400

Egypt Sudan Zambia Algeria

Existing Capacity (MVA)


BUSINESS LINE REVIEW: ELECTRICAL PRODUCTS

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

Elsewedy Electric’s acquisition of Iskraemeco establishes a global metering and measurement giant with the technological strength to build tomorrow’s smart products and the production and distribution base to capture worldwide market share

In Egypt and Ghana – through United Industries and Elsewedy Electric Ghana, respectively – the company produces fiberglass poles for various electricity purposes, including street lighting and overhead transmission lines.

In 2008 the company established ITALSMEA, a group specializing in explosion proof products for the petroleum sector. ITALSMEA supplies bulk electricity goods to the local Egyptian and international petroleum sector.

Electrical Products

ECMEI Fiberglass Poles Explosion Proof Products

ECMEI was established in 2004 and today produces 7,000 tons of different electric ceramic insulators, with a particular expertise in high tension with various applications.


BUSINESS LINE REVIEW: METERS

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In 2007 Elsewedy Electric acquired Slovenia’s Iskraemeco, one of the world’s most technologically advanced producers of metering equipment and services. The acquisition establishes a global metering and measurement giant with the technological strength to build tomorrow’s smart products and the production and distribution base to capture worldwide market share.

Iskraemeco Iskra Amesi

Energy Measurement and Management

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

Iskraemeco is one of the world’s most technologically advanced producers of metering equipment.

Iskraemeco group production plants and offices Iskraemeco references (customer locations)

Iskraemeco currently supplies over 2 million meters, mostly to countries in Europe and the Gulf


BUSINESS LINE REVIEW: WIND

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Elsewedy for Wind Energy Generation (SWEG) integrates the world class technology and production expertise of Germany’s SIAG Group, Spain’s M. Torres Olvega Industrial (MTOI) and Elsewedy Electric. The business line constitutes a significant step forward for wind power in Africa & the Middle East.

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.

SWEG – Elsewedy for Wind Energy GenerationM. Torres OlvegaIndustrial (MTOI)

Gearless Wind Turbines

Wind Towers – SET Wind Farm Development – Elsewedy Power

Operations and Maintenance – Elsewedy

Power

Balance of plant – Elsewedy Cables, Elsewedy Transformers, Elsewedy Electrical Products

(ECMEI), Iskraemeco

SIAG Elsewedy Towers (SET) is a joint venture between SIAG ‐ Schaaf Industrie Aktiengesellschaft, a leading German steel manufacturer, and Elsewedy Electric, to build wind towers for the MEA region and the South European market.

SWEG coordinates with Elsewedy Power as developer and co‐developer of wind farm developments.

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.

MTOI currently produces TWT turbines (1.65 MW) in Spain.

With the acquired know‐how of industry leading MTOI, SWEG continues to focus on expanding its operations and maintenance offerings.

SWEG, along with Elsewedy Engineering and Contracting companies, acts as system integrator, executing balance of plant projects with support from across Elsewedy operations


Recent Financial Performance

MANAGEMENT REVIEW

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Revenue (LE million)

Gross Profit (LE million)

Consolidated Results for H1 2014 ended June 30th, 2014

Consolidated revenues increased by 11% to reach EGP 8.5 billion for H1 2014, versus EGP 7.7 billion in H1 2013.

Gross profit increased by 5% to reach EGP 1,298 million during H1 2014, versus EGP 1,234 million in H1 2013.

Net profit after Minority Interest increased by 49% reached EGP 215 million in H1 2014 versus EGP 144 million for H1 2013.

796

509

117 97 113

215

2010 2011 2012 2013 H1‐2013 H1‐2014

Net Profit (LE million)

15,09914,51212,902

15,169

7,697 8,511

2010 2011 2012 2013 H1‐2013 H1‐2014

Wires & Cables Electrical Products Turnkey Projects

2,0651,988 1,912 1,832

1,234 1,298

2010 2011 2012 2013 H1‐2013 H1‐2014


MANAGEMENT REVIEW

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Revenues by Business Line H1‐2014

Gross profit by Business Line H1‐2014

78%

12%

4%4% 2%

Wires & Cables Turnkey Projects Transformers Other Electrical Products Meters

Revenues and Gross Profit Contribution by Business Line

77%

11%

7%3% 2%

0

72%

11%

9%

4% 4%

64%14%

13%

4% 5%

Revenues by Business Line H1‐2013

Gross profit by Business Line H1‐2013


MANAGEMENT REVIEW

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Revenues from the meters segment decreased by 34% in H1 2014 versus H1 2013 to reach EGP 346 million versus EGP 524 million in H1 2013. Gross profit decreased by 27% to reach EGP 119 million in Q1 2014 versus 164 million in H1 2013. .

Revenues from the transformers segment increased 48% in H1 2014 versus H1 2013 to reach EGP 344 million, whilst gross profit increased by 2% to reach EGP 55 million in H1 2014.

Wire & Cables Segment Meters Segment Transformers SegmentWires & Cables segment revenues increased by12% to reach EGP 6,664 million in H1 2014 versusEGP 5,943 million in H1 2013. In terms ofvolumes, the segment sold 87,449 tons of cables inH1 2014 versus 70,732 tons in H1 2013, an increaseof 24%.

LE (000)’s Q2-2014 Q2-2013 % Change H1-2014 H1-2013 % Change

Revenues 4,167,767 4,099,245 2% 8,510,669 7,697,396 11%Wire & Cables 3,222,117 3,139,466 3% 6,663,982 5,942,881 12%Turnkey Projects 485,821 507,620 -4% 1,008,305 852,447 18%Meters 191,917 232,725 -18% 345,641 523,674 -34%Transformers 194,878 138,162 41% 344,060 232,910 48%Other Electrical Products (Including Wind) 73,035 81,272 -10% 148,680 145,485 2%

Gross Profit 684,745 683,664 0% 1,298,125 1,233,653 5%Wire & Cables 479,456 436,816 10% 931,585 790,392 18%Turnkey Projects 64,079 103,252 -38% 140,712 170,233 -17%Meters 71,326 79,721 -11% 118,658 163,412 -27%Transformers 47,106 32,971 43% 54,965 53,878 2%Other Electrical Products (Including Wind) 22,777 30,904 -26% 52,205 55,737 -6%

Gross Profit Margin 15% 16% 15% 16% 15% 16%Wire & Cables 15% 14% - 14% 13% -Turnkey Projects 13% 20% - 14% 20% -Meters 37% 34% - 34% 31% -Transformers 24% 24% - 16% 23% -Other Electrical Products (including Wind) 31% 38% - 35% 38% -


MANAGEMENT REVIEW

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Net debt as of June 30th, 2014 increased to reachEGP 3,327 million versus EGP 3,185 million as ofMarch 31st, 2014.

Turnkey Projects Other Electrical Products Segment DebtTurnkey revenues witnessed an 18% increase,reaching EGP 1,008 million in H1 2014 versus EGP852 million during H1 2013. Gross profit decreasedby 17% to reach EGP 141 million in H1 2014 versusEGP 170 million in H1 2013.

Revenues from the Electrical products segmentincreased by 2% in H1 2014 versus H1 2013, toreach EGP 149 million, whilst gross profitdecreased by 6 % to reach EGP 52 million.


FINANCIAL PERFORMANCE: CONSOLIDATED INCOME STATEMENT

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(Figures in LE ) 2010 2011 2012 2013 H1-2013 H1-2014

Sales

Wires & Cables 9,828,543,544 11,306,127,679 11,118,283,671 11,733,985,741 5,942,880,692 6,663,981,752

Electrical Products 1,383,376,706 1,338,459,408 1,513,953,044 1,578,382,507 902,068,441 838,382,081

Turnkey Projects 1,690,100,136 2,524,616,623 1,880,070,432 1,786,624,669 852,446,826 1,008,305,073

Total Sales 12,902,020,387 15,169,203,711 14,512,307,147 15,098,992,917 7,697,395,959 8,510,668,906

COGS (10,914,190,218) (13,257,512,379) (12,680,791,224) (13,034,117,023) (6,463,743,121) (7,212,543,757)

Gross Profit 1,987,830,168 1,911,691,332 1,831,515,923 2,064,875,894 1,233,652,838 1,298,125,149

Gross Profit Margin 15.4% 12.6% 12.6% 13.7% 16.0% 15.3%

SG & A (851,159,144) (900,599,128) (973,720,780) (1,062,912,959) (503,775,237) (581,958,531)

Other Operating Income / (Expenses) (49,439,537) 43,069,439 (121,239,490) (206,920,729) (221,341,009) (271,170,851)

EBITDA 1,366,317,365 1,384,827,512 1,084,735,660 1,182,215,144 700,762,918 627,923,223

EBITDA Margin 10.6% 9.1% 7.5% 7.8% 9.1% 7.4%

Depreciation & Amortization (279,085,878) (330,665,869) (339,532,720) (387,172,938) (192,226,326) (182,927,455)

Fx Gain / ( Loss) (12,717,369) (110,732,805) (96,847,851) (11,390,697) (22,231,329) 34,170,955

Provisions (3,257,001) 730,814 (41,617,456) (132,744,721) (20,118,347) (18,018,922)

EBIT 1,071,257,118 944,159,652 606,737,632 650,906,787 466,186,916 461,147,801

Interest Expense (220,797,854) (371,671,108) (426,460,972) (434,721,035) (219,870,411) (157,030,992)

Interest Income 57,319,589 61,193,380 48,048,786 24,417,366 9,857,618 23,788,548

EBT 907,778,853 633,681,924 228,325,446 240,603,118 256,174,123 327,905,358

Tax (91,142,132) (97,134,033) (82,389,733) (106,074,477) (89,644,840) (97,762,476)

Net Income 816,636,721 536,547,891 145,935,713 134,528,641 166,529,283 230,142,881

Minority Interest (21,107,572) (27,429,195) (29,394,891) (38,026,848) (22,416,489) (15,108,131)

Net Income After Minority Interest 795,529,149 509,118,697 116,540,822 96,501,795 144,112,794 215,034,750


FINANCIAL PERFORMANCE: CONSOLIDATED BALANCE SHEET

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(Figures in LE) 30-09-13 31-12-13 31-03-14 30-06-14Fixed Assets 3,325,582,966 3,350,493,168 3,302,369,051 3,180,465,322Investments 42,012,611 22,973,473 23,444,082 23,582,548Other Long Term Assets and Goodwill 215,694,694 201,841,704 187,974,896 184,779,122Total Long Term Assets 3,583,290,272 3,575,308,346 3,513,788,029 3,388,826,993

Inventories 3,831,372,842 3,699,178,762 3,203,412,162 3,964,448,499Receivables 4,734,005,601 4,180,729,048 4,456,290,141 4,371,580,693Other Debt Balance 1,179,658,678 1,182,227,888 1,294,962,293 1,216,807,670Due from Related Parties 184,365,872 192,873,358 203,985,677 355,749,433Cash and Cash Equivalents 1,089,202,564 1,528,874,240 1,578,909,178 1,945,068,439Total Current Assets 11,018,605,557 10,783,883,296 10,737,559,450 11,853,654,733

Bank Overdraft and Short Term Loans 5,663,254,153 4,918,073,216 4,405,409,388 4,918,251,839Accounts Payable 1,017,209,604 1,315,833,852 1,452,074,148 1,487,334,790Other Credit Balance 1,595,326,699 1,789,747,011 1,997,647,735 2,352,759,319Due to Affiliates 122,702,682 172,680,187 176,283,261 197,789,161Provisions 199,993,577 219,829,699 248,730,882 228,371,941Total Current Liabilities 8,598,486,715 8,416,163,964 8,280,145,415 9,184,507,050Working Capital 2,420,118,842 2,367,719,332 2,457,414,035 2,669,147,682Total Investments 6,003,409,114 5,943,027,677 5,971,202,064 6,057,974,675

Issued and Paid Capital 2,234,180,000 2,234,180,000 2,234,180,000 2,234,180,000Retained Earnings 1,910,225,095 1,900,996,805 1,988,833,580 1,973,344,144Net Profit of the year 190,293,798 96,501,795 105,081,480 215,034,750Others 1,014,657,204 1,055,361,465 1,115,363,652 1,131,110,114Total Equity 5,349,356,097 5,287,040,065 5,443,458,712 5,553,669,002

Long Term Loans 469,361,178 504,689,446 358,972,469 353,353,906Other Long Term Liabilities 184,691,844 151,298,168 168,770,884 150,951,754Total Long Term Liabilities 654,053,021 655,987,614 527,743,353 504,305,660Total Long Term Liabilities and Equity 6,003,409,114 5,943,027,676 5,971,202,061 6,057,974,675


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ELSEWEDY H1-2014 Investor Presentation. pptx Relations/Presentation... · 2014-09-15 · new markets and sectors. Elsewedy Electric Investor Presentation H1‐2014. FULL‐SERVICE

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