KUWAIT: Egypt Kuwait Holding Company (EKH) on Wednesday announced its financial results for the period ending June 30, 2024, prepared in accordance with Egyptian accounting standards. The company recorded total revenues of $321 million during the first half of 2024, with a gross profit margin of 42 percent, and net profit of $100 million, resulting in a net profit margin of 31 percent. The net profit attributable to the company’s shareholders rose to $90 million.

Commenting on the Group’s performance during the first half of 2024, EKH Chairman Loay Jassim Al-Kharafi stated: “The results of the first half of 2024 reflect the company’s resilience and ability to seize opportunities, achieving exceptional profitability despite regional challenges.”

Al-Kharafi emphasized the group’s commitment to expansion in 2024, noting the recent agreement with the Egyptian Ministry of Petroleum and Mineral Resources which expands the concession areas granted to North Sinai Petroleum Company – an EKH subsidiary that holds the North Sinai offshore concession, with the aim is to enhance exploration efforts and increase gas production in the coming period.

He highlighted that the agreement follows the company’s success in discovering and commencing production from the expanded concession’s first exploratory well, KSE-2, in June 2024. The second well, Aton-1, is expected to commence production in September 2024, further contributing positively to the performance of our subsidiary and EKH overall. This demonstrates our ability to realize the benefits of strategic investments made in recent years, which have played a key role in diversifying and strengthening our investment portfolio.

Al-Kharafi further added that in 2024, the Group has focused on expanding into regional markets and exploring investment in new and diverse sectors. This strategy is aimed at achieving sustainable growth and maximizing the company’s foreign currency revenues. He also commended the efforts of the executive management and employees across the company and its subsidiaries for their efforts in executing the board’s growth strategy and maximizing returns for shareholders.

Jon Rokk

Strong results

Jon Rokk, CEO of Egypt Kuwait Holding, expressed pride in the strong results achieved by the group despite the operational challenges faced during this period, including the devaluation of the Egyptian pound against the US dollar and the slow recovery of global urea prices.

Rokk added that the group’s investment portfolio succeeded in achieving strong revenue performance and maintained outstanding operational performance thanks to its commitment to operational excellence, as well as its extensive track record and expertise in the sectors in which it operates.

He stressed the group’s commitment to implementing proactive strategies to address potential exchange rate fluctuations. The management is studying opportunities for geographic expansion and investment in new and diverse sectors to achieve sustainable growth and maximize the company’s foreign currency revenues while avoiding market challenges. He affirmed his confidence in the team’s ability to maximize long-term positive returns for shareholders and all stakeholders, as we strive to seize attractive growth opportunities.

Fertilizers and petrochemicals sector

The fertilizers and petrochemicals sector achieved revenues of $181 million during the first half of 2024, with a stable net profit margin of 41 percent. The net profit attributable to the company’s shareholders amounted to $67 million during the same period.

Alexandria Fertilizers Company recorded revenues of $107 million during the first half of 2024, continuing to achieve strong profitability, with the gross profit margin remaining stable at 38 percent, and the operating profit margin before interest, taxes, depreciation, and amortization increasing by 2 percentage points to 45 percent during the first half of 2024, thanks to comprehensive reforms implemented by the company during the period. Additionally, the net profit margin remained stable at 33 percent, with the net profit attributable to the company’s shareholders reaching $26 million. The company is expected to achieve strong results in the coming period, supported by forecasts of rising urea prices and stable gas supplies.

Sprea Misr’s revenues, denominated in Egyptian pounds, grew by 8 percent year-on-year due to the gradual improvement in prices, reaching $74 million. The net profit attributable to the company’s shareholders rose by 15 percent to $40 million during the first half of 2024 compared to the same period in 2023.

Energy and energy-related activities sector

The energy and energy-related activities sector recorded revenues of $83 million during the first half of 2024, with a 4 percentage point increase in net profit margin to 49 percent. The net profit attributable to the company’s shareholders increased by 1 percent year-on-year to $37 million during the same period.

NatEnergy recorded revenues of $55 million during the first half of 2024, with a 6 percentage point increase in net profit margin to 44 percent, and the net profit attributable to the company’s shareholders rose by 3 percent year-on-year to $21 million. Additionally, revenues from the North Sinai offshore gas concession area reached approximately $29 million during the first half of 2024, with a 2 percentage point increase in net profit margin to 56 percent during the period. The company continues to achieve positive results, driven by expansion efforts, including increasing the concession area to 440 square kilometers and drilling two new wells.

Insurance and other diversified sectors

Revenues from other diversified sectors amounted to $57 million during the first half of 2024, driven by the strong performance of Delta Insurance Company during the first quarter of the year. The insurance sector also achieved notable results, benefiting from rising interest rates and the increase in insurance premiums due to the revaluation of insured assets, which will positively impact the sector’s performance in the coming period.